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Watch Out Rami Levy: New Cell Provider Promises Even Lower Costs

Energy conglomerate Dor Alon promises to beat all the cell companies on price with its new service - beating even low-cost king Rami Levy
By David Lev
First Publish: 12/22/2011, 11:15 AM

After the introduction of lower-cost cellphone service by Rami Levy, another company from outside the cellphone industry – energy conglomerate Dor Alon – will also be selling cellphone service, with rates ranging 40% - 50% lower than what the “traditional” service providers charge. Alon Cellular, a subsidiary of Dor Alon, will begin operating in March 2012, the company said Thursday, operating under the name YouPhone.

The new company was made possible after the government's adoption last year of a plan to allow “virtual” cell phone service providers to sell services to the public. YouPhone is another one of five MVNOs (mobile virtual network operators), which use existing cellphone service infrastructure (in this case, Orange's) to sell services to the public. The use of the cellphone companies' infrastructure by virtual providers was one of the conditions Pelephone, Cellcom and Orange had to agree to in order to get licenses to the frequencies they use for cellphone service.

The first company to take advantage of the MVNO plan was the Rami Levy chain of supermarkets, which began marketing cellphone service last month. A spokesperson for YouPhone said that the company intends to match Levy's service prices, and go it one better – eliminating a NIS 15 fee that Rami Levy customers must pay each month for basic service. The spokesperson said that YouPhone customers would have access to a wide range of phones, from the most basic to the most advanced smartphones.

In a statement, the company said that its service will be a great boon for families, especially those with children who are active cellphone users. “Polls show that 87% of consumers have a difficult time controlling their children's cellphone costs, and that cellphone service bills constitute a major part of the family budget. We intend to present intelligently designed and inexpensive plans for the entire family that will save money for customers. Our approach is that, as opposed to the current situation where it is considered a heavy financial burden, cellphone service should be easy to pay for and available to individuals and families, as it is in the U.S. and Europe,” the statement added.