Alon Israel Oil Co. Ltd., controlled by president and CEO David Wiessman, is about to reach a cooperation agreement with Virgin Mobile plc (LSE: VMOB) to enter Israel's cellular market. Virgin is the world's largest Mobile Virtual Network Operator (MVNO) and within the framework of its planned joint venture with Alon it will bring its brand name and know-how.
The entry of Alon and Virgin creates an opportunity for profound change in Israel's mobile phone market. The two players have complementary strategic capabilities, which cannot be compared to any of the other ventures that have been granted MVNO licenses.
Virgin is one of the world's strongest brands thanks to its owner Richard Branson, a colorful and extraordinary personality who is renowned worldwide.
Virgin will benefit from the Alon Group's marketing power in Israel and the new venture will be better placed to succeed than any other MVNO that tries to enter the market.
The topic of MVNOs is complex and complicated to implement in Israel but Virgin's experience will help. Matters regarding MVNOs still need to be finalized in Israel because the cellular operators see them as a threat and negotiations so far have failed.
Published by Globes, Israel business news - www.globes-online.com - on October 12, 2010
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