In his secondary role as communications minister, Prime Minister Benjamin Netanyahu yesterday fired the ministry’s director general, Avi Berger, just as a major element of Berger’s centerpiece reform of the broadband Internet market went into effect.
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Berger’s dismissal was seen by sources in the communications sector as a political act, a critical element of the prime minister’s plan to control reforms both in telecommunications and the broadcast media. Netanyahu had been acting as communications minister since last November, but waited until the new government was sworn in last week to act.
The range of Netanyahu’s interests was signaled by a meeting he held last week with Len Blavatnik, a Russia-born, American-Jewish entrepreneur, about the possibility of his buying control of the financially troubled Channel 10 broadcaster.
The prime minister took the time out while he was preoccupied with putting together the final elements of his coalition. Spokesmen for both sides declined to comment on the meeting, but RGE Media Group, in which Blavatnik holds a one third stake, had reportedly been in secret talks with Channel 10’s controlling shareholder Yosef Maiman last week.
It is not clear whether RGE will make a bid at all, but time is running out for Channel 10. The broadcaster has just 14 days to meet the terms of its license, including 70 million shekels ($18.4 million) in guarantees and fees, and a change in ownership.
Blavatnik, who controls Clal Industries in Israel and the Access Group in the United States, is not known to be especially close to Netanyahu. In any case, he faces possible competition for Channel 10 from Ilan Shiloah, a high-tech and communications investor and entrepreneur who has right of first refusal to buy Channel 10 shares.
Berger, who had been appointed by Gilad Erdan in October 2013, was notified of his dismissal via a phone call from the Prime Minister’s Office.
One of the biggest beneficiaries of his departure is Bezeq, which stood to lose considerable revenues from the broadband reform Berger promoted. His reform would allow more companies to compete in the market and end the division between infrastructure providers and service providers.
The Communications Ministry imposed an 11-million-shekel fine on Bezeq last week for allegedly blocking the opening of the broadband market. Berger had other plans for reforms aimed at bringing down communications costs, which industry sources said would now likely be frozen.
The next stage of broadband reform did go into effect yesterday, allowing users to automatically switch providers. As of last night, only 200 or so people had done so, although the number was probably in the few hundreds.
The reform, which allows other companies to piggyback their Internet services on Bezeq’s infrastructure at government-controlled prices, is expected to create more competition and lower charges. The reforms officially went into effect three months ago, but it was harder to switch providers until yesterday and only some 13,000 users had done so.