Pele-Phone Communications held a press conference after its board's approval of a turnaround plan. CEO Jacob Gelbard, chair Amnon Neubach and deputy CEO Gil Sharon said the company is expecting its 2002 revenues to increase by 10%.

The only decision still to be approved is who will upgrade Pele-Phone's network to 1X technology. CEO Gelbard indicated the winner in the upgrade tender would be announced in a month.

The turnaround plan is for the next four years. Gelbard estimates that "in 2002 the company will be profitable according to USGAAP. According to Israeli accounting practices, Pele-Phone will reach profitability no earlier than 2003. We will also reduce the cost of customer acquisition by lowering our subsidy per end device, from $300-400 by $50, a move that will save the company about $40 million a year."

Pele-Phone plans to invest about $300 million within the next two years in the development of its engineering infrastructure. Half of the money will be invested in upgrading the existing CDMA network to 1X.

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The company also plans to co-operate with overseas cellular operators, one being the Korean SK, with whom it signed a memorandum of understanding for the development of new 1X applications. The two companies are to meet next week to consider shortening the time needed to launch 1X based services.

Chairman Amnon Neubach notes that the entire communications sector in Israel is very leveraged, granting the banks ever-increasing influence in the field. "The banks will have significant influence over growth rates, predicted to be 8% to 15% in 2002."

Gelbard added the company will surpass the 105,000 subscribers goal it had set itself.