While the Israeli Iron Dome anti-rocket system was a big success during the last two years in two wars with Hamas, the threat from Hezbollah in south Lebanon is another matter entirely. It’s all a matter of numbers. In the recent 50 day war with Hamas Iron Dome intercepted 735 Hamas rockets, which were 90 percent of those headed for populated or military base areas. That was up from the eight day 2012 war were there were 421 intercepts and those were 84 percent of those headed for populated or military base areas. The 50 day war faced 9,000 Hamas rockets, of which 40 percent were locally made. The local models are less accurate and reliable than the factory made rockets. More of the locally rockets never made into Israel, either exploding in the air for falling within Gaza than with the factory made ones. Hezbollah has 50,000-100,000 Iranian factory made rockets. How many Hezbollah could launch (as many as ten times what Hamas got into the air during the 50 day war) depends on what disruption plans (air, ground and special operations) Israel has and how effective these plans are. This has Hezbollah worried because they noted that Hamas underestimated Israel during the 50 day war and saw all their “secret weapons and special plans” fail. The Israelis are determined to do the same to Hezbollah. On top of this Hezbollah is suffering heavy losses in Syria, where they are supporting the Assad government at the behest of Iran, which has long supported both Hezbollah, the Assads and Hamas. The problem is that most Lebanese hate the Assads and Syrians in general. Thus Hezbollah efforts to support the Assads has been very unpopular in Lebanon and this has made it easier for Israel to gather intelligence on the ground and support from some anti-Hezbollah Lebanese factions.
The Hezbollah threat is greater not just because they have more rockets, but because many of them (several thousand) are long range models that can reach just about everywhere in Israel. These, as Hezbollah likes to point out, could shut down all the ports and airports in Israel, at least to commercial traffic. Israel has been working on deploying its ten (soon to be fifteen) Iron Dome batteries in the north and use them to concentrate on the longer range rockets. But Iron Dome is seen as a last defense line. The primary weapon against all those Hezbollah rockets is intelligence, diplomacy (with anti-Hezbollah factions in Lebanon) and precision weapons (bombs, missiles and shells).
Meanwhile Israel has developed planning and predictive analysis software to help with outsmarting Hamas. This is nothing new as the key to Iron Dome’s success is its software. Iron Dome uses two radars to quickly calculate the trajectory of the incoming rocket and does nothing if the rocket trajectory indicates it is going to land in an uninhabited area. This means the software can also tell if the rocket is going deep into Israel. If the software predicts a rocket coming down in an inhabited area, a Tamir guided missile is fired to intercept the rocket. This software has been very successful.
In the north, against Hezbollah Iron Dome will also be able to prioritize Tamir launches to go after the rockets predicted to do the most damage. This makes the system very efficient and cost-effective. That's because most of these unguided rockets land in uninhabited or thinly populated areas but the few of those that do land in populated areas inflict casualties. Those long range rockets can land in very densely populated urban areas.
There’s nothing special about most of the Iron Dome components. The Tamir missiles each weigh 90 kg (200 pound), are three meters (9.8 feet) long, and 160mm in diameter. They have the usual components of a guided missile (rocket motor, electronics, and mechanical devices to actuate the fins and batteries). Such interceptor missiles are increasingly common, but usually against much faster ballistic missiles. Without the predictive software Iron Dome would quickly run out of missiles and be much more expensive to operate as well.
As of 2014 Israel has bought ten Iron Dome batteries and is scrounging up the cash to obtain another five. Each of the Iron Dome batteries has radar and control equipment and three or four missile launchers (each containing twenty missiles). Each battery costs about $50 million, which includes up to a hundred Tamir missiles. These cost $90,000 each but would cost under $50,000 each if produced in larger quantities.