January 13, 2015
Israel's 4G mobile market is suddenly looking extremely crowded after six operators secured licenses during an auction of 1800MHz spectrum intended for use with 4G services.
Israel is relatively late to the 4G auction game -- most developed economies having already handed out frequencies to support the high-speed mobile technology -- although incumbent operators Cellcom Israel Ltd. and Partner Communications Co. Ltd. (Nasdaq: PTNR; London: PCCD) have been able to launch 4G services in major urban areas by refarming 1800MHz airwaves they already held.
Pelephone Communications Ltd. , meanwhile, is reported by Reuters to have been operating a 4G network using spectrum borrowed from Israel's Communications Ministry.
All three companies received licenses in the 4G auction, along with existing mobile operators HOT Mobile, a subsidiary of French cable group Altice, and Golan Telecom.
The sixth license winner is new mobile entrant Marathon 018, which already offers Internet and long-distance services.
The auction raised a total of 250.5 million Israeli shekels (US$63 million), according to Reuters, with Pelephone emerging as the biggest spender, forking out ILS96 million for a 15MHz license.
Cellcom and Partner also each hold 15MHz for 4G now the auction is finished. Cellcom spent ILS19.5 million for 3MHz, to add to the 12MHz it had already refarmed in this band, while Partner paid ILS33.5 million for another 5MHz, having previously refarmed 10MHz.
The remaining license winners find themselves at an immediate spectrum disadvantage, having each paid between ILS32 billion and ILS34.5 billion for a much smaller 5MHz allocation.
With a population of around 8 million, Israel now has one 4G licensee for every 1.33 million inhabitants, making it one of the most congested mobile broadband markets on the planet.
Want to know more about LTE? Check out our dedicated 4G LTE content channel here on Light Reading.
Even now, operators are struggling to protect their sales amid fierce price-based competition. Shiomi Fruhling, Cellcom's CFO, held "price erosion" partly responsible for a 6.7% fall in the operator's revenues during the July-September quarter, while Partner has warned investors that mobile average revenue per user will probably fall "by a few shekels" in the final quarter, from ILS76 per month in the third, because of pricing pressure.
Operators have been taking advantage of new regulations allowing them to share infrastructure to reduce rollout costs and defend profit margins, with Israeli authorities declaring "it will not be possible to have five 4G radio infrastructures on the market" in auction documentation published last year.
Cellcom has teamed up with Golan Telecom on 4G network sharing and is also splitting the cost of maintaining passive network equipment with Pelephone.
Winning bidders will be expected to start providing 4G services over their new frequencies within a year of receiving licenses and to have covered at least 30% of the population within 18 months, 65% within three years and the entire country within four years.
— Iain Morris, News Editor, Light Reading
Read more about:Europe
About the Author(s)
You May Also Like
5G Network Automation and AI at Global Megaevents: A Telco AI-at-scale case study with Ooredoo and EricssonOct 10, 2023
5G Transport & Networking Strategies Digital Symposium.Oct 26, 2023
Improve Service Efficiency in the Call Center and Field with Slack AutomationOct 13, 2023
Open RAN Evolution Digital Symposium Day 1Jul 26, 2023