Cellcom Israel Ltd. (NYSE:CEL; TASE:CEL) has announced that it is "conducting negotiations towards a 4G radio network sharing with Pelephone Communications Ltd., or Pelephone, and Golan Telecom Ltd. (both Israeli cellular operators), and towards sharing of passive elements of cell sites for existing networks with Pelephone."
The negotiations between the carriers are apparently proceeding at a record pace, and they have reached understandings to hold the shared network and share the costs equally. This is a major change in the Israeli mobile market, and it challenges the Ministry of Communications and the Antitrust Authority, which believe that a deal between the veteran carriers jeopardizes competition.
Although the Ministry of Communications has said that it supports network sharing in principle, it is not clear whether it supports a structure of two networks per carrier, or three networks. In view of the progress in the negotiations, it seems that Golan Telecom, which has been sitting on the fence, will enter into talks with one of the groups to join in the establishment of a shared network.
The situation at the moment is that the entire market is waiting for the regulators, either the Ministry of Communications or the Antitrust Authority, and until they reach agreement, it will not be possible to know what the mobile infrastructure market will look like.
Published by Globes [online], Israel business news - www.globes-online.com - on December 4, 2013
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