Israeli’s newspaper market has become a bubble in the past decade, inflated by the presence of multiple free dailies led by U.S. billionaire Sheldon Adelson’s Israel Hayom.
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In greater New York, with a population of more than 20 million, free dailies have a combined circulation of 588,000, led by Metro with 196,000 copies a day. In Israel, with just over 8.6 million residents, the combined circulation of all free dailies and weeklies is about 3.5 million copies a week.
The result has been a grueling money-losing battle that has seen both advertising rates and inches drop. In 2009, Israeli newspapers carried 27 million column inches of advertising, worth 1.3 billion shekels ($340 million). Last year, they ran 21 million inches, generating just 700 million shekels of revenues.
The newspaper war was also behind the alleged deal Prime Minister Benjamin Netanyahu was trying to make with Arnon Mozes, the publisher of the Yedioth Ahronoth daily, Israel’s biggest paid-for newspaper. The two discussed reining in the circulation of Israel Hayom in exchange for Yedioth proving more favorable coverage of the prime minister.
In fact, Israel Hayom’s print run has dropped precipitously since it peaked at 550,000 daily during the 2015 elections. Last month it was cut another 50,000 copies, to 275,000. That still makes it by far the biggest of Israel’s free newspapers, with 2.05 million copies distributed each week.
Israel Hayom’s launch in 2007 began the newspaper war. Although still primarily a paid-for daily, Yedioth responded to the pressure from Israel Hayom and joined the war by giving away between 80,000 and 100,000 copies every day. In recent months it has begun giving away a reduced version, without the supplements that appear in the paid-for newspaper.
Maariv, which is controlled by Eli Azur, the publisher of The Jerusalem Post, joined the fight at the start of 2016 with a downsized version Maariv Haboker that distributes about 100,000 copes around the country.
In addition, there are a handful of weeklies serving the ultra-Orthodox community that are distributed for free on Fridays, led by Yeted Neeman.
Giving away newspapers is a money-losing business, as evidenced by an estimate published by Haaretz this month that showed Israel Hayom lost 730 million shekels in its first seven years. But publishers do it out of concern about the TGI survey or newspaper and radio audiences.
TGI’s reports not only influence a newspaper’s reputation by showing whether it gained on or lost to rivals but also affects ad rates.
In all events, the strategy doesn’t seem to be working. The latest TGI report, which is based on surveys of what Israelis says they are reading or listening to, the combined exposure of all Israeli newspapers fell in the second half of 2016 to 54.9% from 57.7% in the first half.
“There’s a significant part of the public that has stopped reading print media and appears to be satisfied to get their information and content from other media platforms,” said Eitan Kassif, the CEO of Kantar Media Israel.
TGI said Israel Hayom reached 38.6% of Israelis, compared to 33.9% for Yedioth Ahronoth on weekdays. Yedioth still led on weekends, with a 38% share to Israel Hayom’s 37.2%.