RealTime IT News

AT&T Takes IBM Israel Clients

This week another step was taken in the transition process of moving Internet activities from IBM to AT&T, a decision made after AT&T established new subsidiary AT&T Global Network Services Israel. Now the new company will provide Internet connections for clients of IBM Israel's Internet section.

AT&T acquired IBM's International Internet activities last December for US$5 billion. Today, IBM Israel has 6,000 subscribers, many of them business accounts. Very few new subscribers have joined IBM Israel's network during the last two years, this was attributed to the fact that IBM Israel was not prepared to incorporate new technologies (almost all links were analog or frame-relay).

The main source of IBM Israel income has come from providing Internet services to ISOC, the organization that provides Internet connections to academic institutions in Israel.

Analyst Avi Weiss noted that Bezeq Zahav, the wholly owned subsidiary of Bezeq, the Israeli communications company, also represents AT&T in Israel. Today Bezeq Zahav has approximately 8,000 subscribers, especially from the business sector, and continues to grow.

Agreements such as this demonstrate how Bezeq, the company that maintains a monopoly on telephone communications within Israel, has gained a foothold in the Internet market. Last week the company also acquired 50 percent of Walla, the largest Israeli portal.