Bezeq was founded in 1984 as a government-owned corporation, taking over the provision of telephony services in Israel, which were previously run directly by the Ministry of Communications. The drive for creating the company was the highly bureaucratic and inefficient nature of the government run service, requiring customers to wait several years until they got a phone line installed. In the late 1980s Anat Hoffman founded a group, Bezeq-Afflicted Clients Association, to protect the interests of Bezeq customers. A major complaint was that Bezeq refused to offer customers itemized bills, so they had no assurance they were paying for services they actually received. National hearings were held where customers had the opportunity to share their grievances against Bezeq. Hoffman notes that of 46 cases handled through small claims court, the consumers prevailed against Bezeq in 43. Within two years of the well publicized campaign for itemized bills, they were finally offered to consumers. In 1994, Bezeq acquired 50% ownership of Pelephone, Israel's first mobile communication company, in 2004 acquired full ownership of the company from its co-owner Motorola. In 1998, Bezeq co-founded Yes, a direct-broadcast satellite provider, which began broadcasting in July 2000. In January 2012, Bezeq International Optical System was completed, a submarine telecommunication cable linking Tel Aviv and Bari in Italy. The system spans 2,300 km of cable, and extended terrestrially from Bari through Interoute's network to major European cities. In April 2012, Bezeq acquired full ownership of Walla! Communications, Israel's leading Internet portal, which has more than 2.5 Million monthly unique users. Bezeq operates the B144directory enquiries and yellow pages brand. In February 2015, Bezeq acquired full ownership of Yes, Israel's leading television provider, for ₪680 million. In 2018 the company announced that company CEO Stella Handler would be resigning her position. She is one of several Bezeq employees under investigation by the Israel Securities Authority and the Israel Police regarding Bezeq's purchase of Yes shares and allegations of improper dealings with the Israeli Ministry of Communication. Also in 2018, board members Shaul Elovitch, Or Elovitch and Orna Elovitch resigned as a result of Case 4000, an ongoing corruption investigation involving the Israeli Prime MinisterBenjamin Netanyahu.
In 1994, Cellcom a new Mobile communication company was founded, breaking Pelephone's monopoly in this area. In 1999, a third competitor, Partner Communications Company, was established. In 1997, two new competitors were introduced in international calling services, and Bezeq was obliged to establish a new subsidiarity to compete with them named Bezeq International. Until the mid-first decade of the 21st century when it was owned by the Israeli government, Bezeq had a monopoly on landline telephony and Internet access infrastructure. Though still the most dominant provider of telephone services, it has had competition from the sole cable provider in the country, Hot, which offers a cables based telephone and internet access services as of 2005, and with 012 Smile and more recently 013 netvision and Orange.
Privatization
On 9 May 2005, Israel's Government Companies Authority, headed by Eyal Gabbai privatized Bezeq when 30% of its shares were sold by the state to the Apax-Saban-Arkin investment group for $972 million. The cellular communications provider Pelephone is a fully owned subsidiary of Bezeq. Bezeq is also the largest shareholder in D.B.S. Satellite Services Ltd., known by its trademark name, Yes, the DBS television provider in Israel. In April 2010, the controlling interest in Bezeq, held by the Apax-Saban-Arkin group, was sold to B Communications, a subsidiary of Shaul Elovitch's Eurocom Group, for $1.75 billion. In late 2017, bank filed a petition against Elovitch to break up Eurocom Group to pay back loans totaling $275 million. This would directly impact the 10% shareholding in Bezeq, including Elovitch's 26% controlling stake. Meir Shamir has expressed interest in buying a controlling stake, effectively cancelling the debt to the banks. Two other investors have also expressed interest in purchasing a stake in Bezeq, including Argentine investor Eduardo Elsztain and Elliott Management, who announced they had recently purchased a 4,8% stake.
Operations
The company's fixed-line domestic communications segment offers domestic carrier services, including basic telephony, Internet infrastructure and access services, and transmission and data communications services. This segment also provides infrastructure, transmission, billing, leasing space, and related services for other communications operators, operates and maintains radio transmitters, carries out set-up and operation works of networks or sub-networks for various customers and offers virtual private networks, data center, and search engine services. As of December 2012 Bezeq has:
Pelephone Communications Ltd. : Israel's first cellular phone operator
Bezeq International Ltd. : Provides customers with services in international telecom, data hosting, data communication, and information security systems.
Yes : Yes is Israel's only provider of multi-channel television broadcasts via satellite to subscribers, and was the first company to offer digital broadcasts and interactive television services.
Bezeq On-Line Ltd. : Provides outsourcing and call-center services.
Walla! Communications : Israel's leading Internet portal.
Bezeq International Optical System : a submarine telecommunication cable linking Tel Aviv and Bari, Italy
Locations
Bezeq's headquarters are located in Azrieli Center's triangular tower in Tel Aviv, occupying 17 floors. It is considered one of the anchor companies in the center. In 2020 the offices are expected to move to Holon's industrial zone. The company also has nine dedicated stores spread throughout the country.
