The Hayek committee recommends immediately reducing telephony connectivity fees by 76%, similar to the reduction in mobile inter-network connectivity fees. The recommendation, if adopted, will slash revenue of Bezeq Israeli Telecommunication Co. Ltd. (TASE: BEZQ) and other telephony operators for incoming calls from mobile phones and other telephony networks.
The telephony connectivity fee is currently NIS 0.042 per minute at peak hours and NIS 0.022 per minute at off-peak hours. The Hayek committee recommends a fee of zero to NIS 0.01 per minute.
The Hayek committee met for the last time yesterday, and will probably publish its recommendations next week.
The committee debated whether to cut the telephony connectivity fee immediately or to wait for the recommendations of the consultancy firm hired to price the costs of the Bezeq network. Ministry of Communications deputy director general Assaf Cohen wanted to wait, but the majority of committee members want an immediate cut in the telephony connectivity fee on the scale of the cut in mobile connectivity fees. After the consultancy firm hands in its recommendations, adjustments can be made with the telephony operators.
The Hayek committee also discussed whether Bezeq should be allowed to continue charging user fees. Most committee members want the practice ended, and that will probably be the final recommendation.
Sources inform ''Globes'' that Ministry of Communications deputy director general engineering Haim Garon wrote to Minister of Communications Moshe Kahlon saying that price controls Bezeq and its structural separation should not be lifted until it is clear that their replacement - the new wholesale market - actually works and delivers the hoped-for results. Assaf Cohen agrees with Giron on this point, which will likely become a minority recommendation by the Hayek committee.
Published by Globes [online], Israel business news - www.globes-online.com - on September 21, 2011
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