Bezeq filed an appeal in the Anti-Trust Tribunal yesterday, through Adv. Niv Zekler, in which is
requests that the Tribunal rescind the decision of the Anti-Trust Authority to turn down the
Company's request for revocation of its declaration as a monopoly in basic telephone
service.
Bezeq contends that it is no longer possible today to separate the mobile telephone field from the
fixed-line telephone field, and that both are included in basic telephone service. Thus, it has
ceased to hold more than half of the field of basic telephone service. According to Ministry of
Communications data, there are currently 2.8 million direct (fixed) telephone lines, and 4.8 million
cellular telephone lines.
Moreover, in terms of revenues, Bezeq's part in the provision of basic telephone services is less
than half of the revenues of the cellular companies for providing cellular services.
Nati Bialistok-Cohen, internal anti-trust officer at Bezeq, said that there is an inconsistency
between the Anti-Trust Tribunal's determination in Appeal 7/95 - the appeal which Bezeq filed
immediately after it was declared a monopoly in 1995, and the determination of the Anti-Trust
Authority when it rejected Bezeq's recent application for revocation of its being declared a
monopoly.
In the appeal, Bezeq quotes from the Anti-Trust Tribunal's decision in 1997: "... This is a dynamic
field that changes from time to time, and should it transpire in the future that the part of the
Petitioner (Bezeq) in this field... falls below the minimum required by law, then there will be no
impediment to the Petitioner contesting the declaration again, on the basis of the new facts as may
be at that time."
"In the years since 1995, when Bezeq was declared a monopoly, revolutionary changes have occurred
in Israel's communications sector. The Anti-Trust Commissioner should have ascertained whether
Bezeq's share in providing basic telephone service (which encompasses both mobile and fixed-line
services), is less than half, and had he found that this is indeed the case, he should have revoked
the monopoly declaration for basic telephone service," states Bezeq in its appeal.
"However," the appeal continues, "The Commissioner, in his decision, completely disregards the
decision of the Anti-Trust Tribunal (in Appeal 7/95), and the definition of the field of basic
telephone services set out there. The Commissioner has set himself up as an appellate level of the
Honourable Tribunal, and at the stroke of a pen he has cancelled the definition of the market
appearing in the decision in Appeal 7/95, and determined a new definition of the market instead -
the fixed-line telephone market..."
"Whereas the Tribunal determined years ago that 'It seems that today, cellular telephone service
does indeed fall within basic telephone service', the Authority seeks to construe this determination
erroneously, and unilaterally determines that 'The cellular telephone service market is separate and
differentiated from the fixed-line telephone market'", said Byalistok-Cohen. He added that over and
above the fact that by making this determination, the Authority is actually undermining decisions of
the Anti-Trust Tribunal, the decision is also tainted in that it is out of touch with reality, since
it was not made on the basis of any financial investigation.
"Anyone these days will tell you, or just look around at the range of services advertised in the
media to see the place and status of the cellular phone. It will be perfectly obvious that the
Authority's observation that 'From the point of view of the consumer, the cellular telephone is not
a sufficiently meaningful replacement for the fixed-line telephone, and is in fact complementary...'
is not a serious one and disregards the facts on the ground.
The fact that more than 60% of communications expenses in Israel are directed toward cellular
communication and less than that to the telephony provided by Bezeq - is evidence of the
considerable growth in the popularity of cellular communication, which is taking over rapidly from
fixed-line communication as a reasonable alternative," said Bialistok-Cohen.
"The facts indicate that not only private persons. but also many large institutions, companies and
organizations, have switched in recent years to cellular communications as an alternative to
fixed-line communications. We are simply unable to grasp how the Anti-Trust Authority can allow
itself to ignore the facts and to make assumptions and determinations on the basis of a 'gut
feeling', and that is why we have had to turn to the Tribunal," said Bialistok-Cohen.
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