Cable gaining on Bezeq in Net war [pg. 17]

Bezeq recruited 150,000 new high-speed Internet users in 2005, but cable companies argue that they are, nonetheless, taking market share from the telecommunications provider. Bezeq said Monday that by year-end 800,000 customers were using its high-speed (ADSL) Internet services - double the number of customers two years ago. Although Bezeq enjoys a 66 percent market share and still rules Israel's high-speed Internet access market, cable operators have been gaining ground in recent months. "In 2005, the fast Internet market has won a total of 245,000 new subscribers of which 39% chose the cable networks and 61% chose Bezeq. If we compare these percentages to the total number of subscriptions, we can see that Bezeq, on a year-over-year basis, has been losing market share from 66% to 61%," said a spokesperson for HOT, the joint venture of Tevel, Matav cable and Golden Channel. HOT with a total market share of 34%, said it had 417,000 subscribers on its cable network and had added 95,000 new subscribers in 2005 - gaining 5% market share. "What plays to our advantage is the triple package we offer combining Internet, television and telephone services," HOT said. Israel is among the world's leaders in high-speed Internet penetration connecting 65% of households and over 1.2 million surfers. In 2005, only South Korea was ahead of Israel in penetration percentage at about 75%. "We can certainly say that 2005 was a revolutionary year in the demand for broadband," said Bezeq marketing manager Ran Goron. More than 50% of customers switched to high-speed surfing of 1.5 mega and upwards, Bezeq said, noting that it already had recruited thousands of customers to its 5 mega package launched about three months ago.