Subscriber churn was lighter in Israel in January than in 2016. The most important development is that Golan Telecom Ltd. is no longer a factor or competition catalyst in the market, despite the company's aggressive bargain campaigns.
Golan Telecom recently launched sales promotion stands in a large number of shopping malls around Israel. On the eve of the company's acquisition by Electra Consumer Products (TASE: ELEK), the results are not encouraging. The company is losing subscribers at an ever-increasing rate. Hot Telecommunication Systems Ltd. (TASE: HOT.B1), on the other hand, gained 3,688 subscribers, while trying to create value for its customers, rather than selling at any price, with an unlimited package for NIS 49 a month.
Golan Telecom's net subscriber losses (new subscribers minus lost subscribers) exceeded 8,000, while abandonment of the veteran cellular operators is slowing. The figures show that Golan Telecom will have to reinvent itself under its new ownership.
The churn figures are on a downtrend, showing that more and more customers have taken advantage of the lower prices, while prices levels are not falling. One example is Pelephone Communications Ltd., which is selling cellular packages with two lines for NIS 50 through its Bug and Kravitz distribution channels. Golan Telecom is still pushing prices down, at least until its acquisition is completed, and Partner Communications Ltd. (Nasdaq: PTNR; TASE: PTNR) and Cellcom Israel Ltd. (NYSE:CEL; TASE:CEL) are working hard, although it looks like Cellcom took its foot off the gas in January.
Cellcom was the only veteran operator to lose subscribers in January, shedding more than 4,000 of them, while Partner picked up a net 2,700 subscribers and Pelephone led the entire market with 3,900.
Among the virtual operators, 019 lost the most subscribers, but still led the segment with a net gain of 2,300. Rami Levy Cellular, on the other hand, lost as many subscribers as it recruited, leaving it with a net gain of less than 100.
Published by Globes [online], Israel Business News - www.globes-online.com - on February 1, 2017
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