NetVision Ltd. (TASE: NTSN) has launched a campaign against HOT Telecommunication Systems Ltd. (TASE: HOT), claiming that HOT is in breach of its license as an Internet services provider even before the company has begun the service. NetVision presented findings to the Ministry of Communications which purport to show that not only is HOT is in breach of the structural separation provisions of its license, but that it has no intention of complying with them at all.
NetVision claims to show that HOT's Internet activity, provided through subsidiary HOT.net, is actually managed from HOT's offices in Yakum, and that HOT.net telephone numbers are the same as the numbers of the parent company. NetVision alleges that the manning of the jobs at HOT.net is fictitious, because the jobs are manned by HOT officeholders, who work simultaneously on the Internet activity.
NetVision claims that HOT has no intention of separating the activities. It alleges that proof of this is found in the fact that calls made to coordinate reciprocal network connectivity fees between the companies are carried out by HOT itself, and that the subsidiary is not involved in the matter.
HOT's ISP license mandates full structural separation. A two-year battle was fought over this point led by NetVision and 012 Smile Telecom Ltd. The purpose of structural separation is to prevent cross-subsidization between HOT's Internet infrastructure and its Internet service provider activities, so that other Internet services providers (ISP) can offer Internet access at more or less equal terms.
HOT said in response, "NetVision petitioned the High Court of Justice even before HOT was awarded an Internet access license, and then withdrew the petition. It now complains, oddly, about activity that has not yet even begun."
NetVision is the ISP and international calls carrier subsidiary of IDB Holding Corp. Ltd. (TASE:IDBH), and is the sister company of mobile carrier Cellcom Israel Ltd. (NYSE:CEL; TASE:CEL).
Published by Globes [online], Israel business news - www.globes-online.com - on January 6, 2011
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