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Israel – Tender launched for 5G next-gen mobile networks, to provide higher speeds

Bidding for frequencies will be open both to local and foreign players, said Tal Elimelech, in charge of the initiative at the ministry, in a briefing with reporters. He declined to disclose if any foreign companies had expressed an interest in bidding.

“No official comment” was forthcoming at the briefing regarding the participation of Chinese companies in the tender or possible limitations on the use of Chinese technologies and components by bidding companies.

Regulators in the US are leading an effort to remove components developed by China’s Huawei and other firms from the telecommunications networks of US firms because of national security concerns.

In April, South Korea claimed to have beaten the US in becoming the first country to roll out a 5G mobile network. Verizon’s 5G service was launched in parts of Chicago and Minneapolis that month.

According to a July 3 report of the Global Mobile Suppliers Association, 280 operators in 94 countries are investing in 5G networks in the form of tests, trials, pilots, and planned and actual deployments.

In the tender, Israel will auction frequencies ranging from 700 MHz-2100 MHz, which are also used for 4G services, to 2600-3800 MHz, which is only for 5G services.

Companies that win the bid will be able to delay payment for the frequencies until 2022, so they can more easily invest the significant amounts of money needed to deploy the network. The 5G network, which would be an added layer on existing 4G networks, is estimated to cost around NIS 2 billion ($562 million).

In 2011, the Communications Ministry started a reform in the cellular market, which was dominated by three main players, Pelephone, the cellular operator of Bezeq Israel Telecom; Cellcom Israel Ltd.; and Partner Communications Co. The reform enabled customers to more easily switch from one provider to another, keeping their phone numbers, and, more importantly, allowed new entrants into the game.

This generated fierce competition between the firms and has help cut prices of cellphone calls for Israelis by as much as 90 percent. The cellular providers, however, have seen their revenues and profits plunge in the process.

“Where in the world do you have a country with some 8.5 million people where there are six cellular operators competing with each other and a monthly subscription price close to the cost of a falafel,” said Ilanit Sherf, head of research at Psagot Brokerage.

 

Full article: Times of Israel