Eli Azur Breaks Into Big-time Media

Only a few months old, the upstart publisher's new weekend newspaper Sof Hashavua is making a splash with its star journalists while rival Maariv sinks.

Radio stations commonly bleep out obscenities, but in the ads for Eli Azur's Friday-only newspaper Sof Hashavua, which are played incessantly on the radio stations he also owns, it's the name of a competitor - Maariv - that is is bleeped out.

Maariv isn't just another one of Sof Hashavua's competitors. The vast majority of writers for Azur's paper, launched at the end of 2012, were senior columnists at Maariv, including Ben Caspit, Yehuda Sharoni, Ron Maiberg, Natan Zahavi and gossip columnist Leora. Azur was even incompetition to buy out Maariv along with its printing presses. He made a NIS 120 million bid for the property, but lost out to Shlomo Ben-Zvi, publisher of the right-leaning daily Makor Rishon.

"It could be said that Azur profited. Had he been left with Maariv, he wouldn't have had the managerial flexibility he has now and would have likely ended up with losses," says a senior media executive.

But now, just over half a year later, while Maariv wallows in losses and is being forced into repeated cutbacks in order to survive, it is Sof Hashavua that evinces stability. Industry sources say the reason for Maariv's continued downward slide, despite massive belt-tightening, is Sof Hashavua, which is thriving.

One reason is the migration of many Maariv subscribers to the new paper. Insiders say that a key part of Azur's strategy depends on Maariv not surviving for much longer.

Sof Hashavua, according to industry estimates, already has more than 15,000 paid subscribers, with another several thousand copies sold at newsstands. That is a significant achievement for a publication in business for less than a year. With ad revenues of an estimated NIS 500,000 a month, the paper is running up losses but meeting Azur's business targets, industry sources say.

Exact figures weren't forthcoming from Sof Hashavua, but sources at the paper say that more than 50,000 copies are printed each week and that it's breaking even financially.

The main reason the paper has gained such a firm financial footing so soon is Azur's ability to create synergies with his other media operations. Azur owns a printing house where he puts out the English-language Jerusalem Post, which he also controls. In addition, Sof Hashavua's sales and customer service teams use the Post's call centers. Some of Sof Hashavua's content, too, comes from Azur's other media outlets, such as the Hebrew-language Israel Post and Forbes Israel. (Azur recently lost his Forbes franchise but the cooperation will continue. )

Paying for talent

Azur's main expense is probably the talent. The paper's full-time staff is very small, and most of the payroll budget goes to featured writers. It is believed that although Azur offers relatively low pay to writers, certainly in comparison to the formerly high pay levels at Maariv, journalists have been left with little alternative but to keep writing for Azur.

"Azur can be appallingly efficient," says one media executive, who asked not to be identified. "He invests lots of management resources into the paper to keep it economically feasible, and chooses to invest mainly in good writers. In the meantime it works and his newspaper is producing stories and making waves."

As opposed to the old-style newspapers, Sof Hashavua's model is much more adapted to the new media. The newspaper doesn't appear on weekdays and the edition, published only on weekends, hardly ever carries ongoing news. "The quality of content and the level of design and presentation might be debatable, but in the end the reader receives a product that he feels offers some sort of added value," explains one media executive.

Over the past few months Sof Hashavua has enabled Azur to transform himself from the owner of a few niche media outlets, including newspapers in English and Russian, along with radio stations and a freebie paper that don't carry much influence, into the publisher of a key newspaper with a growing public presence.

He can move his media stars between his radio stations and the newspaper, saving on expenses while becoming an increasingly important force in Israeli media.

Ben Caspit's foothold

Azur deepened his hold in the print media just as the industry was in a slump. The share of newspapers in total advertising fell from 50% in 2005 to 31% in 2012. At the same time new players were entering the arena: The Israel Hayom freebie and Calcalist, a financial daily.

According to Ifat Advertising Monitoring, the number of column inches supplied for advertising by the newspaper industry jumped from 19.2 million in 2006 to 28.3 million in 2012. This, along with declining advertising budgets, meant a dramatic drop in print advertising rates - by more than 50% on average since 2006, according to an analysis of Ifat's data.

If the overall advertising pie continues to shrink, the only way a new media outlet can break in is by generating its revenues at the expense of existing entities.

"There is no doubt that Sof Hashavua profited from the weakening of Maariv," says an advertising executive, who spoke on condition of anonymity. "It receives the ad budgets that once went to Maariv, and companies diverted budgets to it in order to help. Meanwhile, you should note that the large newspapers reduced the number of the pages. In addition, there were local newspaper chains that closed, and this freed up tens of millions of shekels a year in the market."

Another way Azur has succeeded in capturing more advertising is by going around the powerful ad agencies and appealing to the controlling shareholders and CEOs of the companies from whom he wants to win accounts.

Azur, who started his career as a top sports writer for the defunct daily Hadashot, has earned a reputation as a fighter. He engaged in a long battle with the advertising agency McCann Erickson when he took over advertising for the Russian-language Channel 9 and the ad agency boycotted him. Opposite the two Channel Two broadcasters Keshet and Reshet after he won right to broadcast Euro Leaguee games. A year ago he won a legal struggle with the Canadian publisher Canwest over the breakup of their prospective partnership to buy The Jerusalem Post.

At Sof Hashavua the senior content roles at the weekly are filled by Doron Cohen, the former editor of Maariv's Sofshavua weekend magazine and its NRG website, who is responsible for the magazine section, alongside Golan Bar-Yosef who is responsible for the news end.

But insiders say Ben Caspit is the dominant personality in determining the newspaper's content. "He is the star of the newspaper and is involved in every decision, what talent to recruit, even what will be the lead headline," says a media executive who asked not to be identified.

Others disagree. "Caspit is no doubt the highest-ranking writer, but the editorial decisions are made by the editors," says one insider.