Ministers seek to breathe life into vital, troubled fiber-optic internet project

Cabinet ministers on Sunday approved a measure to revitalize a faltering project aimed at laying out infrastructure for high-speed fiber-optic internet across the country, opening the way for a major investment in the struggling enterprise.

Ministers gave their backing to a proposal from Communications Minister Ayoub Kara that eases the terms of a license granted to an Israel Electric Corporation subsidiary, allowing it to provide fiber optics for just 40 percent of households, located in major cities, rather than across the entire country.

The more modest project was a key demand from communications company Cellcom, which had offered to purchase 60% of the subsidiary, called the Israel Broadcasting Company, to keep the financially struggling enterprise afloat.

IBC was set up in 2013 to fulfill a government plan aimed at boosting the country’s internet speeds with fiber optics, a method that uses light signals beamed along hollow cables rather than electricity along copper wires, as the current system uses. Fiber optics can offer download speeds of several gigabits per second, compared to current speeds, which are measured in tens of megabits per second.

The plan envisioned IBC installing fiber optics along the electric company’s existing electric cables, saving the enormous cost of creating a separate infrastructure.

However, so far, IBC has only succeeded in connecting around 150,000 households to the upgraded system.

“After a thorough review, the necessary adjustments were made to operate the project and were approved by the government, thus enabling the country’s citizens to use fiber optics,” Kara said in a statement published by the daily Israel Hayom.

Kara noted that, based on OECD figures, the rate at which fiber-optic systems are being laid out in Israel is “negligible.”

“The process approved by the government will enable high-speed surfing for the country’s citizens…. and will position the country at the forefront of countries benefiting from a fiber-optic layout,” the minister said.

Communications Minister Ayoub Kara attends a press conference in the northern city of Safed, July 10, 2018. (David Cohen/Flash90)

According to the financial daily Calcalist, Cellcom is also expected to demand a reduction in the price for line-laying services and installation, which are carried out by the IEC.

Although the cable television provider HOT and the national phone company Bezeq have already been granted licenses to install fiber-optic systems, in an effort to encourage competition and push deployment of the technology, in practice only a handful of towns and cities enjoy the system, among them Tel Aviv, Ramat Gan, Haifa, Ra’anana, and Netanya.

According to Calcalist, the Communications Ministry hopes that the decision will prompt the main actors in the fiber-optic sector to ramp up their operations due to the competition it will create.

Bezeq is estimated to have laid out fiber optic cables to 70% of the households in the country but has not installed technologies enabling them to come online, the report said.

Last month a UK-based broadband comparison service published its annual internet speed ranking showing Israel had slipped 10 places to 70th out of 200 countries monitored in terms of average bandwidth.

The report found the average download speed in Israel is around 7.64 megabits per second, compared to 7.2 Mbps in 2017. First in the index was Singapore with 60.39 Mbps, while the US ranked 20th with 25.86 Mbps.

Fiber-optic networks are currently the fastest commercial method of moving data. Fiber cables, usually made of glass or plastic, have a wider bandwidth than the copper wires they are meant to replace, and also have the ability to conduct signals at much higher speeds and deliver data signals without fading. That makes them ideal for video and other entertainment content.

David Shamah contributed to this report.