Bethel Finance news:
Partner Communications Company Ltd. ("Partner" or the "Company") (Nasdaq:PTNR)(TASE:PTNR), a leading Israeli communications operator, announces today, following the Company's immediate report on form 6-k dated September 27, 2010 and the Company's 2010 Annual Report (20-F), that on April 12, 2011, Mirs Communications Ltd. (an existing cellular operator) and 018 Xfone Communications Ltd. have won the Ministry of Communications’ UMTS frequencies allocation tender for two additional cellular operators.
Each of the beneficiaries is committed to a payment of license fees in the amount of more than NIS 700 million (US$ 205 million).
The beneficiaries shall be awarded various benefits and leniencies, such as:
(a) A minimal license fee of NIS 10 million (US$ 2.9 million). The remaining amount of the license fee will be paid at the end of the five year period following award of the license. Each of the beneficiaries will be eligible for reductions in the license fee to a minimum of NIS 10 million, according to the market share achieved in the private (residential) segment of the market in the five years following award of the license. For each percent of the private market captured by the beneficiary, the beneficiary will be awarded a reduction of one-seventh of the remaining license fee (less NIS 10 million). The beneficiaries will be required to deposit a guarantee with the Ministry of Communications for the full license fee less the minimal fee of NIS 10 million. The guarantee will be reduced at the end of the second and fifth year according to the market share achieved at that time.
(b) The winners will be allowed gradual geographic deployment of the infrastructure over a period of seven years and use of national-roaming services on the networks of existing cellular operators ("Roaming Services").
In accordance with an amendment to the Telecommunications Law, existing cellular operators will be required to allow the winners to use Roaming Services for a period of seven years, commencing on the date of the Ministry of Communications’ approval that cellular services can be provided by the beneficiary, not through Roaming Services, to an area with at least 10% of the population, and as long as at the end of four years from the beginning of this period, the beneficiary will be able to provide cellular services, not through Roaming Services, to an area with at least 40% of the population. The Minister of Finance and the Minister of Communications can extend each of the above periods for one additional period that will not exceed 3 years. Until the determination of a final tariff by the Minister of Communications with the consent of the Minister of Finance, due no later than February 1, 2012, the existing cellular operator will only be allowed to charge the beneficiary prices for Roaming Services that do not exceed the Interconnect Tariff that will be in effect at that time (with regard to cellular data, the price per 1MB shall not exceed 65% of the Interconnect Tariff set for minute of a voice call). For more information with regard to Roaming Services see the 2010 Annual Report (20-F), under "Item 3D. Key information – Risk Factors" and "Item 4B – Business Overview".
There is a possibility that the beneficiaries shall be awarded in the future additional benefits and leniencies such as the regulation of telecommunications infrastructure sharing as well as a rebates mechanism for spectrum fees, based on the market share gained by the beneficiaries in the private sector over a 5 year period after being awarded the license.
The entrance of new competitors is a significant development in the already vibrant competitive cellular environment in which we operate. This development may cause a further strengthening of the already significant upward trend in subscriber acquisition and retention costs for cellular subscribers and a further strengthening of the downward trend in cellular tariffs, and may also cause an increase in the cellular churn rate above that which has already been experienced, and may further affect our business and operating results.
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