Partner, Cellcom Tumble on Bets Price War Will Hurt Revenues
The shares in Partner dropped 5.4 percent to 16.03 shekels, the lowest level since April 2003, at 12:36 p.m. in Tel Aviv, bringing its year-to-date drop to 52 percent. Cellcom slumped 6.1 percent to 25.25 shekels, the lowest since July 2007, when the shares were listed in Tel Aviv. Bezeq Israeli Telecommunication Corp. (BEZQ), which provides wireless services through a unit, dropped 3.7 percent to 4.082 shekels.
Partner said last week it plans to set up a new low-cost wireless brand called Mobile 012. Competition in telecommunications has intensified after the government forced providers to cut fees and encouraged new players to enter the market.
“This could lead to an additional drop in average revenue per user (ARPU) of all the companies and may hurt revenues,” Rami Rosen, head of research at Harel Finance Trade Securities Ltd. in Ramat Gan, Israel, said today by phone. Partner’s monthly ARPU was 101 shekels ($25.89) for the first quarter 2012, according to data compiled by Bloomberg. Cellcom’s per user revenue was 90.5 shekels for the same period, the data shows.
Golan Telecom Ltd. and Hot Telecommunication System Ltd. (HOT) said in May they’d start offering unlimited mobile-phone services, competing with packages of Cellcom, Partner and Bezeq, who have been the worst performing shares on the TA-25 benchmark index in the past six and 12 months.
Hot dropped 3 percent to 32.89 shekels, the lowest level since May 30, bringing its year-to-date drop to 31 percent.
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