Pelephone Communications Ltd. is waiving the option of including another supplier for the establishment of a 4G network, and will work with Ericsson as its sole vendor for three years. Ericsson won the contract several months ago for setting up the first stage of Pelephone's 4G network, but Pelephone immediately announced it was considering bringing in another vendor.
Pelephone conducted a pricing procedure between the bids by Alcatel-Lucent and Nokia Networks, and in the final stage only between a bid by Ericsson and the Nokia bid. Pelephone and Ericsson announced today that Ericsson would be the sole vendor for Pelephone's network. The agreement constitutes an extension of the agreement signed in April this year for deploying the first stage of the network.
Pelephone's decision to consider another vendor came after it realized that it could obtain more attractive bids from Ericsson, following aggressive pricing by competing vendors. Ericsson's prices in the final stages of the 4G tender were high, leading Pelephone to compare those prices to those of its competitors even at the price of giving up on Pelephone as a vendor, should it not agree to the selection of a competing vendor. Ericsson eventually became more flexible, lowering its prices to the level Pelephone wanted and avoiding the need to introduce another vendor.
The equipment that Ericsson will supply will also support advanced LTE technology, which is just getting started around the world, and will enable Pelephone to achieve theoretical surfing speeds of 450 mbps in downloading data, provided that it has enough frequencies.
Pelephone CEO Gil Sharon said today, "Pelephone is in the advanced stages of deploying its 4G network. We decided to continue with Ericsson as our sole vendor for the 4G network, too, as we did with 3G. This strategy proved itself when we set up the fastest and highest quality network in Israel, and that's also our goal now." Ericsson Israel CEO Alon Berman said today, "We thank Pelephone for deepening our connection of many years standing."
Published by Globes [online], Israel business news - www.globes-online.com - on September 16, 2014
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