“I am convinced that the Israeli public will welcome the combination of built-in digital camera and the ability to receive high-quality video clips. Israelis have already shown a thirst for innovation, and want the most advanced technology. We at Cellcom are proud to the first to offer these services to the Israeli consumer, and we promise to continue to be the communications technology leader in the future, too.”
Beyond the PR, Cellcom president and CEO Jacob Perry’s above comments at a press conference Sunday underscore Cellcom’s great turnaround in the past year. From the technologically most backward company of Israel’s three cellular operators (industry insiders and the Israeli public alike perceived its TDMA technology this way), Cellcom has become the leader in the race for technological innovation in the domestic cellular market.
It will not necessary stay there. Pele-Phone plans to launch a cellular portal soon, based on the ostensibly more advanced platform built by Korea’s SK Telecom NYSE; XETRA:SKM; Korea:17670), and Partner Communications (Nasdaq: PTNRLSE:PCCD) may yet come to its senses while it seeks a suitable answer to Cellcom on the GSM and GPRS fields. But Cellcom proved one thing this week: despite being the market leader financially and in terms of number of subscribers, it hasn’t rested on its laurels and hasn’t forgotten the competition.
On Sunday, Cellcom launched its MMS platform using Nokia’s (NYSE:NOK) 7650 telephone, equipped with a color screen, built-in digital camera and capable of sending 15-second video files. Cellcom bought the platform from Samsung (Korea:00830) subsidiary MPEON. Sources inform “Globes” that the deal was worth $800,000, including games, icons, tones, animations, video clips and other cellular content. The sources added that Cellcom is examining Emblaze Systems’ (LSE: BLZ) more extensive MMS platform. Cellcom has not yet decided whether to buy the platform, which costs an estimated $2 million for 200,000 customers. Cellcom has also presented new Java services that enable cellular telephones to download highly complex games.
Cellom’s innovative character is worrying its competitors. Pele-Phone may had few options, but Partner definitely must figure out how Israel’s sole proponent of GPRS technology company turned into a technology leader. Comments by Partner VP Marketing Yacov Kedmi and Partner VP sales and marketing Effie Rosenhause to the effect that there is no substance to 2.5G GPRS networks sound right. But substance isn’t the issue. 2.5G is already identified with Cellcom, placing Partner is an especially uncomfortable position.
Moreover, Cellcom has proven that it is today possible integrate content into GPRS. Cellcom offers for a range of telephones for its GPRS network, while Partner offers only one. Cellcom also sells modem cards for GPRS-capable mobile computers. Plus, on Sunday it presented the “Tornado”, a GPS automobile navigation system with Hebrew voice activated map reading, Internet connectivity, storage for thousands of MP3 music files, movies and more.
It is almost two years since Partner’s massive media flop, when it announced the launch of a GPRS network that was ready only 18 months later, in Cellcom’s wake. It seems that Partner has not recovered from that fiasco.
Published by Globes [online] - www.globes.co.il - on October 22, 2002