012 enters fixed line market

"We intend to bring to the local market attractive prices and savings of 30% to consumers."

Internet provider 012 Golden Lines made its entry into the fixed line telephony market Thursday, becoming just the second provider to compete with Bezeq as a busy year for the telecommunications industry winds down. The move into the market cost Golden Lines NIS 30 million, but the company expects to gain between 10 percent and 12% market share in the next three to four years. "Just as we did when we entered the long distance calling market, we intend to bring to the local market attractive prices and savings of 30% to consumers," said Stella Handler, CEO of 012 Golden Lines. At the signing ceremony at the Ministry of Communications offices in Jerusalem, Avi Balashnikov, director general of the Communications Ministry, presented Golden Lines with a full license, signed by Prime Minister Ariel Sharon, that enables the company's telephony unit, 012 Telecom, to market regular phone service to its business customers. Phone numbers provided by the new service will have a 072 prefix. The license however, does not extend to residential service, which the company has applied to provide through its Voice over Broadband (VOB) platform. Golden Lines was the first company to receive an experimental license for fixed line telephony through VOB, which it launched in August to a limited customer base of 7,500. Golden Lines was established in 1997 as a long distance provider and today offers Internet service as its flagship product, where it holds approximately 20% of the market. Handler said, however, that the company is looking for the VOB, which allows the transmission of voice, video and data over Internet networks, to be its main growth engine. Internet providers Bezeq International, 013 Barak, Internet Gold and Netvision, and cellular companies Cellcom and Partner are also waiting for their experimental VOB permits to be upgraded by the ministry. Balashnikov noted that Cellcom and Integrated communication company Globcall are awaiting a decision for a similar license to the one Golden Lines received Thursday. The government ended the monopoly held by Bezeq when it allowed cable company HOT Telecom to launch its telephony service in November 2004. HOT said earlier this week it has 70,000 subscribers after one year of offering the service. Bezeq meanwhile, has been placed on certain product limitations until it loses more than 15% of the market.