Russia’s Sistema to Make Smart Phones With Glonass Chip in 2011

Russian billionaire Vladimir Yevtushenkov’s holding company AFK Sistema unveiled the country’s first smart phone equipped with the Glonass navigation chip as the government seeks to challenge U.S. control of satellite navigation.

Devices with chips developed by Sistema and state-run Russian Nanotechnologies Corp. will go on sale for 10,990 rubles ($360) next March, Yevtushenkov said in a televised briefing with Russian Prime Minister Vladimir Putin late yesterday.

“We should start selling it by March 8 as a present for women so they can always identify on the map where their husbands are,” Putin said.

Glonass is a Soviet-era project that stalled after funding collapsed along with communism in 1991. The government this year earmarked 27.9 billion rubles for the project, which faced a setback earlier this month when a Proton-M rocket that aimed to deliver three Glonass navigation satellites into orbit fell into the Pacific Ocean.

Russia plans to require cellphone producers such as Nokia OYJ to provide handsets compliant with Glonass for use domestically, Yevtushenkov said in July. Widespread use of Glonass-enabled equipment will start in 2011, he said.

To contact the reporter on this story: Anastasia Ustinova in St. Petersburg at austinova@bloomberg.net

To contact the editor responsible for this story: James M. Gomez at jagomez@bloomberg.net