Oded (Dedi ) Borovich, one of the owners of El Al Airlines, is planning to lay a new underseas communications cable between Israel and Cyprus for Internet and international calls. The new cable will break up the existing underseas cable monopoly of the MedNautilus cable.
The cost of the new cable is estimated in the $120-$160 million range and Borovich has established a new firm for the venture: BMG Communications. The company is privately held by the BMG Group, which also controls El Al. BMG stands for Borovich Mozes Group. BMG has already reached an agreement with two Cypriot telecom firms on connections from Cyprus onward to Europe.
"We have been working on this initiative for a year with utmost secrecy, and during this period Cyprus has made a huge technological leap," said Borovich.
He expects to receive the draft of a license to operate the cable from the Communications Ministry in the next few days. BMG has also already signed with a company to lay the underseas cable from their ships.
Borovich expects to reach the break-even point in four to six years, and believes he will capture 50% of the market from MedNautilus, which is owned by Telecom Italia. But even if he gets only a 20% share, Borovich says he can still make money.