The Knesset today approved in its second and third readings a government bill allowing new content providers to enter the video-on-demand (VOD) market. The new law will allow satellite broadcaster YES to use the cables of its parent, Bezeq The Israeli Telecommunication Co. Ltd. (TASE: BEZQ), to provide subscribers with VOD service.
Until now, only Hot Cable Systems Media Ltd. (TASE: HOT) provided VOD service, because it was the only company with the technology. YES’s entry into the VOD field will open it to competition.
During the Knesset Economics Committee debate on the bill this week, HOT CEO David Kaminitz opposed allowing YES to offer VOD service. He said that the bill would create an imbalance between HOT and YES. “YES knew about the advantages and drawbacks of satellite broadcasting when it participated in the tender. If it wants to become a cable company, then HOT should be allowed to become a satellite broadcaster too, which would enable meto reach customers for whom I currently lack infrastructure to reach.”
Kaminitz added that the law would not only allow YES to enter the VOD market, but also enter telephony, because Bezeq does not sell internet lines as a clean line, but bundles it with telephony. “This law is a YES law. It’s a pretense to claim that there will be no discrimination in Bezeq’s relations with YES. If YES weren’t owned by Bezeq, would it still have worked this?”
Published by Globes [online], Israel business news - www.globes.co.il - on July 26, 2007
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