Cellcom Israel Ltd. is considering expanding its infrastructure to include a mobile virtual network operator (MVNO). The company is considering adding an MVNO to its obsolescent TDMA network for subscribers who do not download wireless content, such as foreign workers. MVNO will make it possible to provide services directly via TDMA to these subscribers.
Cellcom has no plans to dismantle its TDMA network, even after transferring subscribers to GSM, scheduled to take place over the next 18 months. Adding MVNO to a wireless network could be dramatic. For subscribers, it is tantamount to a second wireless operator, even while using the infrastructure of one operator. MVNO will probably increase market competition, which has abated lately.
Sources inform ''Globes'' that Cellcom has not speeded up its deployment of a 3G network, and that the target date for the start of operation is October 2007.
A source close to Cellcom said, “It might have been necessary to postpone setting up the network by a year. Cellcom raised a banner of Israeli-ness, not innovation, so there’s no need to rush, but it’s impossible to buck the entire world, so the network will be built this year.”
Cellcom signed a contract with Ericsson (Nasdaq:ERICY; SAX:ERIC) to set up a 3G network, which the company estimates will cost $140 million.
Sources said that even when the network is built, Cellcom has no plans for aggressive subscriber recruitment or heavy subsidizing of end-user devices, such as Partner Communications Co. Ltd. (Nasdaq: PTNR; TASE:PTNR; LSE:PCCD) has done, reportedly at a cost of NIS 200 million.
Sources inform "Globes" that Cellcom is laying off between 150 and 200 employees, as part of a restructuring being carried out by new CEO Amos Shapira. The restructuring is designed to place emphasis on customer service, while making savings in other costs. The fact that the Israeli wireless market is becoming saturated is one factor behind Cellcom's decision. The layoffs were made possible by, among other things, the merging of the company's technology and IT units.
Published by Globes [online], Israel business news - www.globes.co.il - on January 11, 2006