Hot Telecommunication Systems Ltd. (TASE: HOT.B1) is raising its prices. After reaching understandings with the Council for Cable TV and Satellite Broadcasting on future price increases, the company announced it was raising prices for some of its customers starting on April 1. Several months ago, the Council vetoed a price rise by Hot Telecommunications.
The first to pay more money will be the television customers, who will have to pay an average of 5% more. In addition, the company's Internet customers (those who are not television subscribers) will pay NIS 10 more. The company also announced that that the cost of its channels would go up by an average of NIS 0.40, except for the sports channels, the price of which would remain unchanged. The company did not specify which channels would be more expensive.
Higher rates are part of the plan devised by the company in mid-2015. The price increases follow the announcement by DBS Satellite Services (1998) Ltd. (YES) of a price increase for video-on-demand (VOD) services. The proximity in time of the two announcements aroused controversy, with the chairman of the Council for Cable TV and Satellite Broadcasting sharply attacking the measure, and promising that she would not ignore it.
The Council announced that it would not allow Hot Telecommunication and Yes to raise their prices, and suspended the increases pending a hearing on the matter. The hearing eventually made minor decisions about transparency and informing customers of future price increases, and repeated past decisions banning price increases offered in bargain campaigns.
The Council abandoned the idea of price controls for the two television companies, in effect paving the way for the current, albeit more transparent, price increases, after causing a commotion in the media with its previous statements. It can be assumed that Yes will also carry out its plan to raise VOD prices. In general, in view of the state of the companies, further prices increases over the coming year cannot be ruled out.
Hot Telecommunications stated, "A message will be sent ahead of time to company customers to whom the price rises apply. There is therefore no reason for customers to contact the service center in this matter. The company will continue to offer competitive prices and provide leading content and advanced technology, while maintaining a high level of satisfaction among its customers."
Published by Globes [online], Israel business news - www.globes-online.com - on March 22, 2016
© Copyright of Globes Publisher Itonut (1983) Ltd. 2016