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Outgoing communications minister announces 1st cut to landline rates in 17 years

Some 2 million Israelis will see price reduction in phone service of up to 40%; Yoaz Hendel says changes will ‘right a long-suffered consumer wrong’

Minister of Communications Yoaz Hendel visits at the Museum of Antiquities in Gush Etzion, December 8, 2020. (Gershon Elinson/FLASH90)
Minister of Communications Yoaz Hendel visits at the Museum of Antiquities in Gush Etzion, December 8, 2020. (Gershon Elinson/FLASH90)

In his final act in the post after being fired due to political maneuvering before possible elections, outgoing Communications Minister Yoaz Hendel announced Tuesday that the ministry would introduce the first cuts to landline rates in 17 years.

According to the reforms, Bezeq customers will see their fees drop to NIS 30-40 (approximately $9-12) a month from the current NIS 50-60 (approximately $15-18), as both fixed packages and pay-per-minute rates see significant slashes.

It total, the Communications Ministry says the cuts will amount to a 40 percent reduction in fees for the some two million Israelis who still subscribe to the landline service, reducing household telephone bills by hundreds of shekels a year.

“We are coming out today with a move designed to right a long-suffered consumer wrong that affects every household in Israel, in which we are revising Bezeq’s controlled fixed-line telephone prices downwards,” Hendel said in a statement hours before his resignation came into effect.

“After not being updated for many years, it is time to turn [over] every stone to correct distortions in the market,” he said, noting that the last change to prices, which are regulated by the government due to Bezeq’s monopoly on the market, took place in 2003.

General view of the Bezeq Satellite Station in the Haella Valley, February 23, 2008. (Nati Shohat/Flash90)

The reforms will come into place after a ministry hearing on the issue together with Bezeq representatives.

Communications Ministry Director-General Liran Avisar Ben-Horin said in a statement, “The tariff update is needed after 17 years and the changes that have taken place in the communications market and technological developments in recent years.”

He said the move “is expected to produce a proper balance between [Bezeq’s] costs for the provision of the service and the subscriber payments.”

Bezeq, however, called the move a “tool in an unnecessary political game, using Bolshevik regulation that we thought had already passed from the world.”

Bezeq has repeatedly fought back against regulations on Israel’s telecommunications market.

In 2018, a year-long probe found that the company had failed to allow rivals to lay their fiber optic cables through its land-based protected tube lines in accordance with a government reform aimed at increasing competition.

Bezeq workers installing fiber optic cables (Photo credit: Courtesy)
Bezeq workers installing fiber optic cables. (Courtesy)

The Communications Ministry decided some years ago that Bezeq should open its countrywide network of pipes, pillars and other infrastructure to competitors to save them the bureaucracy, high costs and huge disruption to the public of having to excavate to create their own networks underground.

But the reform aimed at upgrading the infrastructure was derailed and is the basis of a graft case in which Prime Minister Benjamin Netanyahu is currently facing bribery charges. The prime minister denies any wrongdoing.

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