Israel's Channel 10 TV Station Gets Six-month Lifeline

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Channel 10’s newsroom.Credit: Alon Ron

The Second Television and Radio Authority came to an agreement early Wednesday morning with Attorney General Yehuda Weinstein on a legal solution that will enable Channel 10 to stay on the air for the next six months. Until then, the cash-strapped station had been facing the prospect of ending its broadcasts Wednesday night, the last day of the year, when its license was due to expire.

Channel 10 shutdown.

The Second Television Authority, which regulates commercial broadcasting in Israel, issued a statement confirming that Weinstein concluded that a decision on the fate of Channel 10 should be deferred for six months — until after the March 17 Knesset elections and after a new government is formed. In practice, Weinstein assumed the powers of the Second Television Authority’s council himself due to the constraints over enacting legislation during an election campaign. He limited the extension to six months, however, so as not to prolong a final decision on the station’s fate for an undue period.

Prime Minister Benjamin Netanyahu, who is acting communications minister, was briefed on the arrangement and expressed support for Weinstein’s plan and as communications minister, Netanyahu is expected to present necessary legislation on the matter to the Knesset himself.

Officials from Channel 10 were not involved in the discussions that resulted in the lifeline to the station, which went on the air in 2002 and runs a distant second in the ratings to its rival, Channel 2. Station representatives from Channel 10 were only informed of the temporary resolution of the crisis late at night, and the station received just a small portion of what it was seeking.

It will not be receiving a permanent license, but the amount of original programming it is obligated to produce will be reduced. That in turn should save the station about 75 million shekels ($19.2 million) over the first half of 2015. The station did not release an official statement on the blueprint worked out with Weinstein.

The six-month breathing space is also an opportunity for Channel 10 officials to stabilize the station’s financial situation, implement its current business plan, pay its outstanding debts to the government and perhaps find a new investor that could provide the financial stability the station must demonstrate in order to obtain a new permanent license. Sources at the station say that two business people, Shlomo Nehama and Amiram Genigar, have shown an interest in investing in the station and that with the extension of the license beyond 2014, the prospects that they will indeed proceed are rising. Nehama is a former chairman of the board of Bank Hapoalim and Genigar is chairman and CEO of Taya Investment.

For its part, the Second Television Authority issued a statement that said in part: “If Channel 10 demonstrates that it is meeting the conditions required at each stage, its request for a 15-year license will be reconsidered by the Second Authority council.”

Second Television Authority officials believe the station will succeed in stabilizing its financial situation even if no new investor steps forward. With CEO Yossi Warshavsky at the station’s helm, Channel 10 has managed to break even in its operational expenses for the past four months, though it still has a negative cash flow.

Reshet and Keshet, the two licensees at Channel 2, who share the broadcast week, are expected to receive a similar license extension from the Second Television Authority. In fact, they are expected to ask for concessions identical to those granted to Channel 10, specifically in the relaxed requirements regarding the production of original content for the next six months. A source at one of the Channel 2 licensees said the station was even considering filing a petition on the issue to the High Court of Justice.

The extension of Keshet and Reshet’s current license might enable them to remain on Channel 22 on cable and satellite television until 2018. That, however, would involve a deferral of proposed legislation to split the two Channel 2 franchises and grant them each their own channel — something that Second Television Authority officials regard as the best solution to the chronic problems afflicting commercial television in Israel. The officials have not given up on forging ahead with that plan even before the franchises’ licenses expire and raised the proposal with Weinstein. But the attorney general rejected the idea on the grounds that such substantive legislation should not be introduced while a caretaker government is in power, just prior to an election.