On July 14, Israel launched a tender for the development of 5G wireless networks in the country. The winning telecoms operators will be announced by the end of the year, with 5G expected to launch in 2020 and continue through 2023.
As the fifth generation of mobile network technology, 5G is expected to be 10 times faster than its predecessor, 4G. Industry commentators believe it could bring about a new technological revolution by opening the door to self-driving cars, smart homes and remote surgeries. As part of the tender, Israel is auctioning frequencies ranging from 700MHz and 2,100MHz, which are also used for 4G, to 2,600MHz and 3,800MHz.
In light of its struggling telecoms sector, Israel is trying to reduce the financial impact that 5G integration could have on its main operators
Among those expected to bid are Israel’s main telecoms operators, Cellcom, Partner Communications and Pelephone. In recent years, these companies have struggled to stay profitable. For example, revenue in Israel’s mobile sector fell 5.6 percent in 2018, according to data from the country’s Ministry of Communications. This is partly a knock-on effect from new operators having entered the market in 2012, which caused a price war and led to the three main operators losing subscribers and revenue. Developing 5G would be sure to give these operators a competitive edge.
In light of its struggling telecoms sector, Israel is trying to reduce the financial impact that 5G integration could have on these companies. In Italy, the government’s tender came at a high cost to businesses: bidders in the Italian sale paid a total of $7.6bn for 5G frequencies, well above the prices paid by companies in the UK and Spain. By comparison, Israel is offering companies incentives of up to ILS 500m ($141.4m), while its Ministry of Communications will give grants to operators who implement at least 250 5G antennas.
Although Israel is home to a thriving tech start-up scene, it still has relatively slow internet speeds and has so far lagged behind other countries on 5G adoption. Spain, South Korea, Switzerland and the UK have already started to rollout 5G services. Through this tender, Israel is pushing to improve its internet infrastructure and ultimately secure the country’s digital future.