Subscribers:
In the first quarter of 2006, the number of Israeli
incumbent broadband subscribers has increased
to 824,000 and a quarterly growth of 2.3% which
is the lowest quarterly growth since the launch
of DSL service by the operator. Two reasons are
legion; firstly this is the result of harsh competition
with “HOT” cable operator, the main
competitor in the broadband market. There is also
the fact that the country is approaching saturation
point considering that over 60% of household are
connected to Internet via broadband. Despite the
overall decline of DSL market growth in terms
of subscribers, the company has seen a positive
year in terms of revenue gain. The positive Internet
momentum will generate revenues where the subscription
fees and traffic voice revenue have shown a decline
during the same period.
At the end of March 2006,
the total number of DSL connections amounted to
824,000 (+16.2% year-on-year), whereas the Internet
lines number rose to 979,000 (+35.2% year-on-year);
while the number of fixed lines in service increased
to 3.136 million (+.84% year-on-year).
Revenues
of Internet according to our estimates accumulated
to March 2006 stood at 34.42 million Euro, a year-on-year
increase of 5.05% mainly as a result of the DSL
subscription fee, Installation and sale of equipment.
DSL Packages
start from 8.7 Euro for a flat rate of 700 Kbps
for the residential market to 26.1 Euro for a
flat rate of 5000Kbps. There is a recurring cost
for hardware and Set and self- Installation for
residential subscribers is free.
Price elasticity:
According to the result of our price elasticity
analysis of Bezeq DSL tariffs for Q1 2005 and
Q1 2006, the demand for DSL broadband is highly
elastic to the change of tariffs, as the arc elasticity
ratio is -3.64. In other words, for every drop
in the cost of bandwidth by one Euro there was
a net gain of 11,600 new subscribers since Q1
2005.
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For more information about
this press release, please contact us at info@quantum-web.com
About Quantum-Web:
Quantum-Web is a leading provider of broadband
tariff research and analysis. It provides broadband
quarterly statistics, pricing analysis, consultancy,
and tailored reports, product of both a deep technological
understanding and a first-rate research methodology.
Quantum-Web uses a variety
of econometric models, statistical techniques
and in-depth market behavioral analysis to provide
comprehensive market intelligence in the broadband
sector. Our services include:
• Broadband
Statistics
• Broadband Tariffs
• Broadband Consultancy
• Tailored Reports
