The TV Companies Win, the Egg Industry and Households Lose

An article in the Economic Arrangements law would give the public five - count them, five - public-access channels for free.

If you happened to be hanging around the Knesset last week, then you noticed representatives of the Finance Ministry, the Second Authority for Television and Radio, and lobbyists of the TV broadcast companies scurrying. They were in a lather over an article in the Economic Arrangements law, which would give the public five - count them, five - public-access channels for free. (Free, except for the one-time outlay of hundreds of shekels on a signal converter). The channels are 1, 2, 10, 33 and 99, the Knesset channel.

The law would have had major financial repercussions for the TV companies, and reverse effects on users. But the Knesset House Committee deferred debate on the topic to January 2008. Appalled, the treasury and the Second Authority are pressing to return the bill to the Economic Arrangements law, so the legislative process could be finished this year.

House Committee chairman David Tal, coalition chairman Eli Aflalo and the chairman of the Economics Committee, Gilad Erdan, agreed. In exchange, Tal and Aflalo demanded NIS 300 million for the egg industry in northern Israel. The treasury said yes, but Dalia Itzik refused and the five-channel idea bogged down.

In the past, Yes and HOT hated the idea because users might forgo multichannel TV. But through their lobbyists, last week they actually supported expediting legislation through the Economic Arrangements vehicle. Why? Because if the article is legislated distinctly from the Economic Arrangements law, then Channel 9 (Russian) and Channel 24 (Israeli music) might demand similar arrangements and even more subscribers would drop out of the cable/satellite deal. HOT and Yes based their compliance on a treasury promise to yank the article if 9 and 24 become included in the "free package." Also, Knesset sources said that Channel 10 and 2 could hurt if 9 and 24 are added to the package, because as their popularity grew through free access, 9 and 24 could nab some of their advertising revenues.

Political machinations thickened the stew. The chairman of the Knesset Finance Committee, Stas Misezhnikov, wanted 9 in the package for the benefit of the Russians in Israel and wanted his committee to discuss it, but the proposal went to the Economics Committee. Erdan, who wants to pass the law now but was blocked by Itzik, threatened to file a private member's bill that would allow only five channels for free, and leave 9 and 24 out. Erdan has positioned himself as champion of the little man. But meanwhile the proposal is stuck, the "free package" doesn't exist, with or without channels 9 and 24, the TV companies aren't losing susbcribers or money, and the only one losing anything is the little man who didn't want multichannel TV.