Competition strong in Israel, but investment is flagging – R&M

Competition strong in Israel, but investment is flagging – R&M

Israel's mobile broadband penetration recently reached a milestone when it crossed over the 100% mark for population penetration, reports Research & Markets.

This reflects the highly competitive mobile sector which exists in Israel, with several operators all competing for customers who enjoy cheap 3G mobile services. While 4G coverage in Israel is significant, the adoption of such services remains low and this has been partly attributed to the prohibitive cost of services and devices. There are concerns being raised that telecoms infrastructure investment is falling behind in Israel.

The operators are feeling the impact of the high level of competition, particularly in the mobile sector. Mobile ARPUs have declined for all the major operators and in 2018 the competitive environment increased even further with the launch of a sixth mobile operator, 018 Xfone, which has launched 4G mobile services under the We4G brand. The regulator recently approved a network sharing and hosting deal between Cellcom and Electra (which acquired Golan Telecom).

Israel has a very high household internet penetration rate, almost all of which are broadband connections. There are various competing broadband platforms the DSL and fibre network of fixed-line incumbent Bezeq, the HFC network of HOT and the fibre network from Partner.

In 2018 Bezeq was directed by the Ministry of Communications to begin offering wholesale telephony services. Bezeq and HOT are both subject to broadband universal service obligations which has resulted in fixed broadband being available to 99% of all households.

Interest in the tech sector is still a key growth area for Israel, with the US and China in particular setting up and investing in various research labs and solutions. Recently Israel turned its attention towards the opportunities presented by the growing cyber-security sector.

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