Bezeq

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Bezeq The Israeli Telecommunication Corp Ltd.
בזק, החברה הישראלית לתקשורת בע"מ
Public
Traded as TASEBEZQ
Industry Telecommunications
Founded 1984
Headquarters Azrieli Center, Tel Aviv, Israel
Key people
Stella Handler, (CEO)
Products Fixed line, Mobile telephony, Internet, Cable television
Revenue Increase 9.98 billion (2015)[1]
Number of employees
15,132
Parent B Communications
Subsidiaries Pelephone, Walla!, yes
Website www.bezeq.co.il
A Bezeq telephone exchange in Or Yehuda
Bezeq company van

Bezeq (Hebrew: בזק‬) is an Israeli telecommunications company. Bezeq and its subsidiaries offer a range of telecom services, including fixed-line, mobile telephony, high-speed Internet, transmission, and pay TV (via Yes).

History[edit]

Bezeq was founded in 1984 as a government-owned corporation, taking over the provision of telephony services in Israel, which were previously run directly by the Ministry of Communications. The drive for creating the company was the highly bureaucratic and inefficient nature of the government run service, requiring customers to wait several years until they got a phone line installed.

In the late 1980s Anat Hoffman founded a group, Bezeq-Afflicted Clients Association, to protect the interests of Bezeq customers. A major complaint was that Bezeq refused to offer customers itemized bills, so they had no assurance they were paying for services they actually received. National hearings were held where customers had the opportunity to share their grievances against Bezeq. Hoffman notes that of 46 cases handled through small claims court, the consumers prevailed against Bezeq in 43. Within two years of the well publicized campaign for itemized bills, they were finally offered to consumers.[2]

In 1994, Bezeq acquired 50% ownership of Pelephone, Israel's first mobile communication company, in 2004 acquired full ownership of the company from its co-owner Motorola.

In 1998, Bezeq co-founded Yes, a direct-broadcast satellite provider, which began broadcasting in July 2000.

In January 2012, Bezeq International Optical System was completed, a submarine telecommunication cable linking Tel Aviv and Bari in Italy. The system spans 2,300 km of cable, and extended terrestrially from Bari through Interoute's network to major European cities.[3]

In April 2012, Bezeq acquired full ownership of Walla! Communications, Israel's leading Internet portal, which has more than 2.5 Million monthly unique users. Bezeq operates the B144 directory enquiries and yellow pages brand.

In February 2015, Bezeq acquired full ownership of Yes, Israel's leading television provider, for 680 million.[citation needed]

In 2018 the company announced that company CEO Stella Handler would be resigning her position. She is one of several Bezeq employees under investigation by the Israel Securities Authority and the Israel Police regarding Bezeq's purchase of Yes shares and allegations of improper dealings with the Israeli Ministry of Communication.[4] Also in 2018, board members Shaul Elovitch, Or Elovitch and Orna Elovitch resigned as a result of Case 4000, an ongoing corruption investigation involving the Israeli Prime Minister Benjamin Netanyahu.[5][6]

Loss of monopoly status[edit]

In 1994, Cellcom a new Mobile communication company was founded, breaking Pelephone's monopoly in this area. In 1999, a third competitor, Partner Communications Company, was established.

In 1997, two new competitors were introduced in international calling services (Barak and Golden Lines), and Bezeq was obliged to establish a new subsidiarity to compete with them named Bezeq International.

Until the mid-first decade of the 21st century when it was owned by the Israeli government, Bezeq had a monopoly on landline telephony and Internet access infrastructure (ADSL VDSL2).[7] Though still the most dominant provider of telephone services,[8] it has had competition from the sole cable provider in the country (since September 2006), Hot, which offers a cables based telephone and internet access services as of 2005, and with 012 Smile and more recently 013 netvision and Orange.

Privatization[edit]

On 9 May 2005, Israel's Government Companies Authority, headed by Eyal Gabbai privatized Bezeq when 30% of its shares were sold by the state to the Apax-Saban-Arkin investment group for $972 million.[9]

The cellular communications provider Pelephone is a fully owned subsidiary of Bezeq. Bezeq is also the largest shareholder in D.B.S. Satellite Services (1998) Ltd., known by its trademark name, Yes, the DBS television provider in Israel.

In April 2010, the controlling interest in Bezeq, held by the Apax-Saban-Arkin group, was sold to B Communications, a subsidiary of Shaul Elovitch's Eurocom Group, for $1.75 billion.[10]

In late 2017, bank filed a petition against Elovitch to break up Eurocom Group to pay back loans totaling $275 million.[11] This would directly impact the 10% shareholding in Bezeq, including Elovitch’s 26% controlling stake. Meir Shamir has expressed interest in buying a controlling stake, effectively cancelling the debt to the banks.[12][13] Two other investors have also expressed interest in purchasing a stake in Bezeq, including Argentine investor Eduardo Elsztain and Elliott Management, who announced they had recently purchased a 4,8% stake.[14]

Operations[edit]

The company’s fixed-line domestic communications segment offers domestic carrier services, including basic telephony, Internet infrastructure and access services, and transmission and data communications services. This segment also provides infrastructure, transmission, billing, leasing space, and related services for other communications operators, operates and maintains radio transmitters, carries out set-up and operation works of networks or sub-networks for various customers and offers virtual private networks, data center, and search engine services.

As of December 2012 Bezeq has:[15]

  • 2.27 million fixed-line customers
  • 2.80 million mobile customers
  • 1.17 million high-speed broadband customers
  • 578,000 pay TV customers

Subsidiaries[edit]

  • Pelephone Communications Ltd. (100%): Israel's first cellular phone operator
  • Bezeq International Ltd. (100%): Provides customers with solutions in international telecom, data hosting, data communication, and information security solutions.
  • Yes (100%): Yes is Israel's only provider of multi-channel television broadcasts via satellite to subscribers, and was the first company to offer digital broadcasts and interactive television services.
  • Bezeq On-Line Ltd. (100%): Provides outsourcing and call-center services.
  • Walla! Communications (100%): Israel's leading Internet portal.
  • Bezeq International Optical System (100%): a submarine telecommunication cable linking Tel Aviv and Bari, Italy

See also[edit]

References[edit]

  1. ^ TASE. "דף הבית - מאיה – מערכת אינטרנט להודעות - הבורסה לניירות ערך". Retrieved 26 December 2016. 
  2. ^ "Ahren, Raphael: A gadfly on the Wall (4 September 2013)"http://www.timesofisrael.com/a-gadfly-on-the-wall/
  3. ^ "Interoute - Interoute and Bezeq International create a new Internet super highway between Europe and Israel". 24 January 2012. Retrieved 26 December 2016. 
  4. ^ "Stella Handler to resign from Bezeq - Globes English". Globes. Retrieved 2018-03-20. 
  5. ^ Rochvarger, Michael; Ziv, Amitai (2018-02-26). "Shaul Elovitch and Relations Step Down From Embattled Bezeq Board". Haaretz. Retrieved 2018-03-20. 
  6. ^ staff, T. O. I. "Top officials, executives revealed as arrested suspects in Bezeq graft probe". Retrieved 2018-03-20. 
  7. ^ "500,000 subscribers for Bezeq's ADSL service". Bezeq. 20 April 2004. 
  8. ^ Wrobel, Sharon (12 February 2010). "012.Smile closes Bezeq deal". Jerusalem Post. Retrieved 15 November 2011. As the largest telecommunication operator in Israel, Bezeq provides wired and wireless telephone and other communications services to consumer and business subscribers throughout Israel. 
  9. ^ Horesh, Hadar. "Apax-Saban-Arkin group big winners of Bezeq tender - Haaretz Daily Newspaper | Israel News". Haaretz.com. Retrieved 9 December 2011. 
  10. ^ "B Communications Closes Acquisition Of Controlling Interest In Bezeq". RTTNews. 14 April 2010. Retrieved 15 November 2011. [permanent dead link]
  11. ^ Arnold, Michael (20 December 2017). "Israeli Banks Take Telecoms Tycoon Elovitch to Bankruptcy Court". Bloomberg. 
  12. ^ Tsipori, Eli (21 December 2017). "An opportunity to break up Bezeq". Globes. 
  13. ^ Gueta, Jasmin (21 December 2017). "Israeli Tycoon Moves Closer to Losing His Business Empire as Banks Seek Wind-up Order Against Eurocom". Haaretz. 
  14. ^ Appelberg, Shelly (17 January 2018). "Three-way Battle Suddenly Erupts for Control of Israel's Bezeq". Haaretz. Retrieved 17 January 2018. 
  15. ^ "Bezeq Q4 & FY 2012 Earnings Presentation". Retrieved 26 December 2016. 

External links[edit]