Smartphone, Cable Prices Set to Drop With Upcoming Israeli Consumer Reforms

New Communications Ministry rules do away with bureaucratic barriers to importing mobile devices, which is expected to cut consumer costs.

Israeli consumers, who have been buffeted by higher prices for everything from bread to electricity, can take comfort in this: Prices for smartphones are likely to drop soon and cable television fees will go down to as little as NIS 100 a month.

Under a reform of the smartphone market, the Communications Ministry is removing a host of bureaucratic barriers to importing mobile devices, a move that is expected to cut the cost to the consumer.

The new rules do away with a requirement that every cell phone importer get a special license from the minister. They also eliminate the requirement that each cell phone model undergo Communication Ministry tests to ensure it meets local standards and operates on authorized frequencies - a lengthy process that limited the range of models available on the local market.

From now on, all devices that meet the European Union standards or those set by the U.S. Federal Communications Commission are automatically approved for use in Israel.

The measures are expected to reduce the time it takes for new smartphones and other devices to reach the Israeli market, increase the number of models available and encourage more importers to enter the market, stimulating competition and leading to lower prices.

Today, the cell phone import market is dominated by the cellular operators, which subsidize the price of phones for those subscribing to their networks. But with the entry of Hot Mobile, Golan Telecom and other new rivals, especially since last spring, the market for so-called SIM-free phones has begun to develop, as consumers buy their phones from independent retailers rather than from their service providers.

Until recently, 90% of all cell phones were bought through service providers, but industry sources say that figure is declining quickly and is likely to settle at just 30% of the market.

Meanwhile, the Cable and Satellite Broadcasting Council yesterday approved a pilot plan under which Hot Communications and YES - which, respectively, control cable and satellite television broadcasting - will be required to offer subscribers a package of limited channels at a discounted price.

Under the plan, slated to go into effect December 1, subscribers will be able to take a basic package consisting of the three domestic TV networks (Channels 1, 2 and 10 ), four channels devoted to sports, children and youth produced in Israel as well others showing TV series, films and world news.

Hot and YES will be able to choose which channels to offer and the price for the package. Industry sources said the price is unlikely to exceed NIS 100.