A consortium of companies led by Sweden's ViaEuropa AB has won the right to construct a high-speed fiber optic Internet network across Israel; with the network having the potential to notably upgrade the country's telecom scenario as well as to offer substantial competition to the existing phone and cable firms.

ViaEuropa, which was the sole participant in the bidding process for a tender for Israel Electric Corporation (IEC)'s fiber optic venture, is heading a consortium which comprises four Israeli partner companies: Tamares Telecom Ltd.; BATM Advanced Communications Ltd.; Rapac Communication and Infrastructure Ltd.; and Bynet Data Communications Ltd.

Under the terms of the consortium, 50 percent of the group will be owned by ViaEuropa; and 12.5 percent apiece will be owned by the four Israeli companies. Meanwhile, the ownership of the fiber optic venture has been worked out in such a way that 60 percent of the venture will be owned by the ViaEuropa-led consortium; with the remaining 40 percent to be owned by the state-run utility IEC.

The venture will chiefly involve the construction of the network with the help of fiber optic cables, capable of providing a `1 gigabit per second' Internet speed which will be nearly 100 times more than the currently-available speeds.

With IEC noting that the deployment of the network will likely commence by 2013-end, IEC Chairman Yiftach Ron-Tal said: "This telecoms venture will ... put Israel on par with developed countries."