The dynamics of liberalisation of Israeli telecommunications

In the Israeli telecommunications sector, with the exception of the local loop and cables, the most important markets have already become intensely competitive. In 1999, competition is expected to be introduced into these two remaining markets also (see Table 10.1). This is a radical change from the etatist past and a relatively impressive success for the Israeli policy-makers. The most impressive changes have doubtless been the enforcement of competition in the cellular and international communications markets, which resulted in a radical expansion of these services, while bringing prices down at the same time. The OpenSky Policy, announced in August 1997, now promises to liberalise the satellite market for the provision of analogue and digital multi-channel radio and TV broadcasting. Telecommunications equipment, business systems and value-added services are also under competition. The vitality of the services markets is reinforced by a dynamic equipment and software industry that extends the telecommunications community. The contrast with the recent past, where the state controlled services and provided the financial resources (rather than Wall Street), and where military, not civilian products, dominated exports, could not be greater. In fact, Israel’s telecommunications sector is experiencing no less than a revolution.