Malam Team Ltd. (TASE: MLTM) has won a Ministry of Public Security tender for a nationwide automatic electronic camera system on the roads. The tender is worth an initial NIS 100 million and could reach NIS 350 million if the ministry exercises the option to install more systems. Three companies bid in the tender.
Malam will operate the system under a 12-year franchise, after which it will revert to the government. Malam will install an initial 50 cameras at sites determined by Israel Police, and will later install an additional 250 cameras. The country's most dangerous roads will have priority for the cameras' placement.
The system includes high-speed digital cameras, which will replace the obsolete film-based cameras now in use. Pictures of offenders will be sent in real time to the Police command center, with the result that the offenders will receive reports almost immediately, rather than after several months. The Police, not Malam, has the authority to issue the reports.
The first 50 cameras alone are expected to boost the number of speeding tickets several times over. Malam will not receive revenue from the reports because the tender is structured so that compensation is based on the rate of output and the efficiency of the system.
The initial cost of the project is estimated at NIS 40 million, and the entire system will cost considerably more. Despite the high cost, the system will probably become a major revenue generator for the state. Figures presented by Ministry of Public Security to the Knesset Finance Committee state that the government expects to make more than NIS 200 million a year from speeding tickets.
It will be possible to closely supervise the writing of reports by changing the margin of error of speeders. Lowering the margin of error to ten km/h over the speed limit, for example, will significantly increase the number of tickets.
Malam will import the digital cameras for the system. Installation of the system is contingent on obtaining approval of the Standards Institution of Israel for the equipment. The Ministry of Public Security should complete these procedures within six months.
Ministry of Public Security deputy director general Yoel Levy said, "The paramount objective of the system is to prevent speeding, which will prevent injury and loss of life. We have figures that show a 30% drop in speeding and a substantial reduction in casualties in countries that have installed this system."
Malam Team's share fell 1.1% by midday on the TASE to NIS54.45.
Published by Globes [online], Israel business news - www.globes-online.com - on March 3, 2009
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