MoC upholds structural separation, clears Cellcom’s Golan buy

MoC upholds separation for Bezeq and HOT, clears Cellcom’s Golan buy

The Israeli Ministry of Communications – which acts as the country’s regulator - has stated that it will uphold the requirement of structural separation that applies to service providers Bezeq and HOT Telecommunication.

TeleGeography reports that while Bezeq has petitioned the country’s High Court to challenge the requirement, a report last month by the Director-General of the MoC found that the provider remained a dominant market power that would likely sideline its competitors if not obliged to maintain structural separation. Bezeq’s petition is now likely to be dismissed following the MoC’s decision.

Bezeq has stated that it is “studying the implications of both the State’s position and the report, while standing firm on its arguments in the petition.” The firm claims that its adherence to the structural separation requirement adds to its “competitive inferiority that is only worsening with time vis-a-vis other telecommunications groups.”

However, there was some good news for Bezeq, with the MoC easing its demand for the provider to deploy a nationwide fibre network. The Economic Times reports that the regulator instructed Bezeq to deploy fibre in areas that the provider considered economically unviable, but has now backpedalled on this.

Bezeq will receive incentives to deploy nationwide across a five-year period. With its rivals Partner Communications and Cellcom beginning to deploy fibre, the government has announced that it intends to create a fund from their revenues that would be made available for bidding by smaller firms, with the goal of pushing rural fibre deployment alongside more financially viable areas.

Cellcom also received some good news, with the MoC announcing that it granted clearance in principle for the operator’s proposed ILS590 million (US$171 million) acquisition of Golan Telecom, although the operator has yet to meet certain conditions for the approval.

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