Israel’s second largest cellco Partner Communications has posted lower than expected net profit for the fourth quarter of 2005 on the back of rate reductions and expenses related to its 3G network. Net income in the three months to 31 December 2005 was ILS83.3 million (USD18.1 million), down from ILS131.4 million a year earlier. Revenue fell to ILS1.26 billion from ILS1.32 billion in 4Q04. Quarterly ARPU fell to ILS156, from ILS170. The company said its results in 2005 were hit by three factors: a 29% cut in interconnection fees that took effect in March, the introduction of 3G technology and its financial restructuring. Partner ended 2005 with a total of 2.529 million active subscribers, up from 2.34 million at the end of 2004, of which 103,000 were 3G subscribers.