Channel 10 television's cash flow crisis has grown so severe in recent days that its executives have approached the big media-buying agencies asking them to pay in advance in cash for air time they can use later.
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- Channel 10 execs meet shareholder Ron Lauder in alleged bid for cash
- Channel 10 TV forced to cut planned content budget for 2014
Broadcast industry sources estimate that Channel 10 is trying to raise between NIS 30 million and NIS 40 million. While it is trying to raise cash via upfront payments, it is also putting off payments to suppliers to stem the flow of money out of the operation.
After a bailout program for the embattled broadcaster was agreed at the beginning of the year, Channel 10's biggest shareholder – United States investor and Jewish activist Ronald Lauder – agreed to inject NIS 80 million into the operation. But Channel 10 is in immediate need of tens of millions of shekels to cover operating losses, finance new productions for next year and complete the move of its operations to Jerusalem
Industry sources say Lauder is not hurrying to transfer the money to Channel 10 until it has presented him with a business plan that shows how the business will reach breakeven. For 2013, the broadcaster is likely to post heavy losses on the back of shows like "The Bachelor" and "Extreme Make-Over," that were costly to produce but generated low ratings.
Channel 10 executives, however, can point to some recovery in its audience rating over the past month, thanks to new programs such as "The Day That Was" and "Economic Evening."
Under the upfront deals Channel 10 is trying to make, media buyers would pay in advance for airtime before they actually use it. That, in effect, means they would be extending credit to the broadcaster for up to several months. In exchange, Channel 10 is offering discounts of up to 15% off its standard rates.
Channel 10 denied it was seeking upfront deals. "The year 2014 will be a decisive one for the commercial television industry, so it's no surprise that an outrageous campaign of disinformation is being waged," it said in a statement.
"Big contracts with media buyers, including upfront payments, are standard practise for all broadcasters and newspapers throughout the year," Channel 10 said. The channel added that the losses being ascribed to it by people in the industry had "no basis in reality" and that Lauder was indeed injecting capital into the operation.