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Cellular giant Cellcom decided over the weekend not to participate in the LMDS technology tender initiated in order to promote competition in the local calls market.

Cellcom told the Ministry of Communications it would withdraw its proposal, after the company's management and board of directors came to the conclusion that the Israeli local calls market was not yet ripe for competition.

Cellcom president Jacob Perry said the "market at present is not yet ready to accept a competitor for Bezeq." Cellcom also reiterated it was clear from the outset that to make entry into the local market worthwhile, the authorities would have to step in and take firm measures against Bezeq's efforts to hinder competition. The government would do well, Cellcom felt, to make decisions that would facilitate competitors' use of Bezeq's access network.

To accomplish that, Cellcom concluded, would not require any changes to the terms of the tender.

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The board of Cellcom therefore believes it is best to hold out until the Ministry comes up with a new policy. The Director General of the Ministry, Advocate Uri Olenik, said that if the tender is cancelled, the Ministry would consider a new policy to help promote competition in the market.

Perry added the company would "continue to clarify Cellcom's position to the Ministry, follow its new policies, and make decisions accordingly."

In preparation for its entry into the local calls market Cellcom formed a subsidiary of 50 workers, New Game. The company is yet to announce the purpose of the subsidiary, but Cellcom spokesperson said Cellcom would not give up the excellent services of these workers.