HOT to trot; communications ministry grants cableco an ISP concession

7 Dec 2010

The Israeli Ministry of Communications (MoC) has reportedly granted cableco HOT Telecommunication Systems an internet service provider (ISP) license, despite prior opposition to such a move by fixed line incumbent Bezeq. According to Ynetnews, the regulator has, however, imposed a condition that HOT must create a separate company to offer ISP services, similar to Bezeq’s setup. As previously reported by CommsUpdate, at the beginning of 2010 Bezeq said it would oppose plans by the MoC to issue HOT with its own internet service provider (ISP) licence, with the incumbent arguing that the proposals should not be carried through without an overall policy change in the broadband market, claiming that providing an ISP licence to HOT with minimal restrictions would be a significant change from the regulator’s existing policy.

HOT, which is the market leader in the multi-channel pay-TV market, already supplies cable lines for internet services to consumers, which are then required to sign up for their broadband packages with alternative service providers. According to TeleGeography’s GlobalComms Database, at the end of September 2010 it had 720,000 broadband infrastructure customers.

Separately, HOT has also announced that it has signed an agreement to refinance its debt, and will receive up to ILS3.4 billion (USD940 million) for seven years from a number of sources, mainly Israeli banks. The cableco will use the funds mainly to pay down outstanding credit, as well as to finance ongoing operations.