Bezeq Begins Deployment of $172M Europe-to-Asia Subsea Cable to Reduce Strait of Hormuz Dependency
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Bezeq Israel Telecom has begun deployment of a high-speed subsea internet cable connecting Europe to Asia, with the 500 million shekel (approximately $172 million) project aimed at reducing global broadband dependency on the Strait of Hormuz, through which roughly 17 percent of global broadband currently passes. The more than 400-terabyte cables will take two years to deploy, with Bezeq expected to announce a European partner shortly and two additional subsea cables planned for launch later this year, positioning Israel as a critical node in international digital infrastructure.
Strategic Significance of the Project
The deployment is significant on multiple levels. The Strait of Hormuz has become one of the most strategically sensitive choke points in global digital infrastructure, carrying a substantial share of intercontinental data flows from Qatar, India, and other Asian sources toward European destinations. Concentration of this volume of traffic through a single geographic corridor exposes the global digital economy to elevated geopolitical and operational risk, particularly given regional tensions that have intensified in recent years. The Bezeq project aims to develop an alternative route for Europe-Asia connectivity, providing the redundancy that global telecom operators increasingly require as part of resilient infrastructure planning.
Project Scope and Timeline
The first cable in the programme will deliver more than 400 terabytes of capacity and is expected to take two years to deploy. With two additional subsea cables planned for launch later this year, the broader programme reflects a substantial commitment by Bezeq to build out infrastructure capacity capable of supporting significant intercontinental data flows. Bezeq chairman Tomer Raved has stated that a European partner for the first project will be announced soon, indicating that the company has structured the venture as a partnership rather than a standalone deployment. Subsea cable projects typically involve consortium structures combining telecom operators, cable manufacturers, installation contractors, and financial partners, with the consortium model spreading capital exposure and operational responsibilities across multiple participants.
Reducing Strait of Hormuz Congestion
Raved has framed the project as a means to relieve congestion in the Strait of Hormuz and to address vulnerabilities in the region's digital infrastructure. Iran has previously warned that submarine cables in the strait represent a vulnerable point for the region's digital economy, and several fibre-optic cables already snake across the strait's seabed, connecting countries across India and Southeast Asia to Europe via Gulf states and Egypt. The existing cable infrastructure is owned by a consortium of countries and telecom companies in the region including operators from Iraq, Saudi Arabia, and Oman, which Raved has indicated provides some protection against deliberate damage. Nonetheless, the principle of redundancy remains central to infrastructure planning, and additional routes around the Hormuz corridor strengthen the resilience of global digital networks.
Israel's Position in International Digital Infrastructure
Raved has positioned the project as one that places Israel as the digital backbone not just of the region but globally, given the need for greater connectivity between Europe and Asia. The framing reflects a deliberate strategic positioning of Israel as a critical transit point for intercontinental data flows, leveraging its geography to bridge European and Asian markets. Subsea cable transit points have historically been concentrated in a few key locations including the Mediterranean, the Red Sea, the Suez Canal, and various Atlantic and Pacific corridors. The development of additional routes through Israel would diversify the global cable network and reduce concentration risk along the established corridors.
Wider Context of Subsea Cable Vulnerability
The Bezeq announcement comes against a backdrop of growing global concern about the resilience of subsea cable infrastructure. Recent incidents involving damage to cables in the Baltic Sea, the Red Sea, and other regions have heightened awareness of how dependent global digital systems are on a relatively concentrated and physically exposed cable network. Major telecom operators, hyperscale cloud providers, and government agencies have increasingly focused on building redundancy into their infrastructure to mitigate the operational and security consequences of cable damage. The Bezeq project directly contributes to this resilience agenda by adding an alternative pathway between Europe and Asia.
Demand Drivers for Additional Capacity
The case for additional Europe-Asia subsea capacity is reinforced by the structural growth in global data flows. The rapid expansion of cloud computing, artificial intelligence workloads, video streaming, and enterprise data services has driven sustained increases in international bandwidth demand. India in particular has emerged as one of the most rapidly growing sources of intercontinental data traffic, supported by the expansion of its digital economy and the rise of major Indian technology firms. The combination of growing demand and concentrated existing infrastructure provides strong commercial justification for investment in additional cable capacity, particularly along routes that bypass concentrated choke points.
Bezeq Financial Performance and Network Position
Bezeq reported an adjusted net profit of 300 million shekels (approximately $103.25 million) in the first quarter of 2026, up from 288 million in the same period a year earlier. Core revenue, excluding fixed-line telephony, rose 2.6 percent to 2.03 billion shekels. The company has maintained its projection of adjusted net profit of 1.0 to 1.1 billion shekels for 2026, compared with 1.09 billion in 2025, and adjusted EBITDA of 3.74 to 3.8 billion shekels, broadly flat year-on-year. The relatively stable financial performance provides the foundation for the company's continued investment in infrastructure projects such as the new subsea cable.
Fibre Network Deployment and Market Share
Bezeq has completed its fibre network deployment, reaching 3 million homes, of which 1.04 million are subscribers, giving the company a 50 percent market share in Israel. The completion of the domestic fibre programme provides the company with a strong cash-generating asset base that can support international infrastructure expansion. The combination of a leading domestic fixed-line position and the development of intercontinental cable infrastructure positions Bezeq as a company moving from a primarily domestic telecom operator into a player with regional and increasingly global infrastructure relevance.
Mobile Segment Performance and Regional Pressures
The Pelephone mobile phone unit posted a 33 percent decline in adjusted net profit to 22 million shekels in the quarter, with revenue down 1.3 percent. The decline was attributed to the impact of the Iran war on the broader operating environment. Despite the profit pressure, total subscriber numbers rose to 2.699 million from 2.631 million a year earlier, with 1.425 million of those subscribers on 5G services. The subscriber growth indicates continued underlying demand for mobile services even as macroeconomic and geopolitical pressures weigh on profitability.
Implications for the Subsea Cable Market
The Bezeq project is consistent with broader trends in the global subsea cable market, where investment is being driven by hyperscale cloud providers, telecom operators, and increasingly governments seeking strategic infrastructure resilience. The combination of capacity expansion, route diversification, and resilience-focused investment is shaping a multi-year cycle of subsea cable deployment across multiple regions. Cable manufacturers, installation contractors, and supporting services such as marine surveying and route engineering are all benefiting from sustained demand. Recent activity around new routes connecting Europe, the Middle East, Africa, and Asia underscores the strategic importance of subsea connectivity in the current global environment.
Outlook for Europe-Asia Connectivity
The Bezeq subsea cable programme reflects a broader effort to diversify Europe-Asia connectivity in response to both commercial demand and strategic risk considerations. The next two years will see substantial activity around cable laying, partner selection, and integration with existing networks, with consequences for telecom operators, cloud providers, and end customers across multiple regions. As more routes are developed, the operational and security profile of global digital infrastructure will continue to evolve. For Bezeq, the project provides a meaningful opportunity to extend its role beyond domestic operations and to establish a presence in one of the most strategically important segments of the global digital economy.
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This article was contributed by an external writer affiliated with our publication.
