Public punishes Golan Telecom for selling out

Michael Golan  picture: Tamar Matzapi
Michael Golan picture: Tamar Matzapi

Golan Telecom lost subscribers in November, for the first monthly fall since the company was founded.

Public outrage over Golan Telecom is evident in the churn figures for November. For the first time since the company was founded, it is paying the price for the antics of its owner, Michael Golan, in the form of a net loss of subscribers. For the first time since it began operating in the local market in 2012, Golan Telecom lost 5,000 net subscribers (new subscribers minus those who left the company). It appears that the latest bargain campaign launched by the company in late November was design to counter this development, among other things. A loss of 5,000 out of 850,000 subscribers is not a major development, but if this trend continues, the company will get less money for its sale to Cellcom Israel Ltd. (NYSE:CEL; TASE:CEL). At the moment, it appears that those abandoning the company are mainly customers concerned about uncertainty caused by the sale, but no collapse or mass desertion is involved, and therefore no major developments in recruitment or loss of subscribers is expected over the coming year.

The leader in new subscribers in November for the third straight month is HOT Mobile Ltd. (more than 13,000 net new subscribers). It appears that the company's bargain campaign for couples (NIS 60 for two lines for a year) is working very well. It will be interesting to see how Golan Telecom's latest bargain campaign (NIS 29 for a line per month for two years) affects the churn figures for December. Meanwhile, however, HOT Mobile does not plan to take its foot off the gas, and is continuing to drive prices southwards.

Another interesting figure concerns Partner Communications Ltd. (Nasdaq: PTNR; TASE: PTNR), which reduced its subscriber losses for the second month in succession. The company has set up a special center with a limited number of marketers, and has begun to retain more customers, mainly through 012 Mobile, whose numbers are not reflected in the churn figures, because they are defined as Partner customers. The company finished November with a loss of only 2,000 subscribers, compared with 7,500 who left Cellcom and 4,500 who left Pelephone Communications Ltd. (excluding YouPhone, which Pelephone acquired, thereby adding 60,000 subscribers this month).

Among the virtual operators, Rami Levy continues to lead the market, although Telzar is not far behind. Although Telzar is recruiting fewer subscribers than Rami Levy, considering the fact that it is a relatively new player in the market, its abandonment rates are far lower. In net subscribers, it is nearing Rami Levy with 2,600 subscribers.

Published by Globes [online], Israel business news - www.globes-online.com - on December 1, 2015

© Copyright of Globes Publisher Itonut (1983) Ltd. 2015

Michael Golan  picture: Tamar Matzapi
Michael Golan picture: Tamar Matzapi
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