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Bezeq: 20 Mbps Internet in 18 months
By Amitai Ziv

Bezeq is set to offer customers Internet connection speeds exceeding 20 Mbps - more than double its current highest speed hookup of 8 Mbps - in about 18 months' time. The total cost of introducing the New Generation Network (NGN) is currently estimated at NIS 2 billion.

The upgrade includes replacing the company's copper wire network with fiber-optic cables.
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Bezeq is obligated to provide universal service, which means that eventually the rapid connection speeds will reach every home in the country.

Bezeq's board of directors has not yet given its final approval for the upgrade, but is expected to do so within weeks. The board has already signed off on the project milestones, including a tender to replace the outdoor switch closets.

The company will pay for some of the expensive redo by selling off some of its real estate: The big switching centers operated by Bezeq in cities and smaller communities around the country will be rendered obsolete by the new system and will be ripe for the picking by real estate buyers.

One industry analyst says that Bezeq's real estate assets are worth about NIS 1 billion, or half of the estimated cost of the new network.

Another chunk of the money needed to install the new network will come from selling off the copper wire that the fiber-optics will be replacing. With world copper prices climbing higher all the time, it's a good time to sell: Bezeq should be able to get about NIS 300 million for the metal.

The Communications Ministry is happy with Bezeq's plans. Prof. Reuben Gronau, who headed a committee that examined the problems plaguing Israel's communications industry, said, "If Bezeq installs the NGN, then half of our job will be done." The ministry has two main reasons for welcoming the measure. It will force HOT Telecom to upgrade its own equipment in order to compete with Bezeq. In addition, the introduction of a rapid transmission network will enable the introduction of an additional multi-channel television player into the market.

HOT issued the following response: "HOT's technological infrastructure was built a number of years ago and they are much more advanced than those of Bezeq. For the past two years HOT has been offering its customers higher speed connections than Bezeq, throughout the country. HOT is already providing connection speeds of 10 Mbps and it can easily upgrade its network to meet market demand."
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