UPDATE 1-Pelephone to compensate customers after network outage

Mon Feb 4, 2013 11:19am EST

JERUSALEM Feb 4 (Reuters) - Pelephone, Israel's third-largest mobile phone carrier, said on Monday it had restored service to millions of customers following a four-hour network outage and would compensate its customers.

Pelephone, a unit of Israel's largest telecoms group, Bezeq Israel Telecom, has some 3 million subscribers, many of whom were prevented from receiving or making calls and sending text messages when the network went down late on Sunday.

It was not immediately known what caused the outage, which also impacted virtual operators that use Pelephone's network.

Pelephone chief executive, Gil Sharon, told reporters that customers could choose the compensation - 60 minutes of free calls within Israel or to the United States and Europe, or 500 MB of Internet surfing. He did not say how much it would cost the company.

Bezeq shares fell 1.4 percent in a flat Tel Aviv market on Monday.

Sharon said the fault occurred around 7 pm (1700 GMT) on Sunday and was fixed by local engineers and from Ericsson and Hewlett Packard before 11 pm.

He ruled out Israeli media speculation that a cyber attack had brought the network down.

Israel's Communications Ministry summoned Pelephone officials on Tuesday to explain the outage. It has recently laid down a number of guidelines to deal with such incidents.

Market leader Cellcom suffered a 12-hour outage in its network in December 2010.

Bezeq's mobile phone unit has suffered intense competition from the entry of six new operators in 2012, which sparked a price war. Pelephone's net profit fell 41 percent in the third quarter.

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