Israel 10 and Eden Broadcasting yesterday won the third television channel tender for what will be Israel's second commercial channel. The decision was made by the Second Broadcasting Authority. The two consortia defeated Afik-Rom and TV3.
Israel 10 led throughout the process, and its win came as no surprise. However, Eden Broadcasting's victory was very surprising, as the consortium trailed Afik-Rom throughout the proceedings. Eden Broadcasting pulled ahead into second place when it revealed the amount of its financial bid - although this accounted for only 5% of the decision-making process - and defeated Afik-Rom by a hair.
Afik-Rom had been in second place, with a score of 52.12%, compared with 49.6% for Eden Broadcasting. After the bids were considered, Eden Broadcasting superceded Afik-Rom by 76.56% to 76.04%. Israel 10, in first place, had 85.47%. TV3 came in last, having received 66.38%.
Before the final results were announced, the other bidders tried to disqualify Eden Broadcasting on the grounds that it had submitted its bid too late. Eden Broadcasting's bid was highest, at NIS 13 million.
In response to the announcement of the results, Afik-Rom CEO Dan Margalit told "Globes" today: "We will examine the tender results and decide whether to file a lawsuit. We always knew our plan met the criteria, and we have to check whether it was right to reject it on the basis of the financial bid."
Voting on the tender began at 16:00. The Second Broadcasting Authority earlier said that the voters would be updated about the size of the bids (one-time franchise fees) only after the other parameters were weighted.
Although the weight of the bid was only 5%, it proved crucial given the tiny gap between Eden Broadcasting and Afik-Rom. It was this factor that caused the last-minute upset, after Afik-Rom had been in second place throughout the process. 70% of the final score was based on content and 30% on the financial offers.
The winning consortia will divide the broadcasting schedule between them, so that each one will broadcast continuously for half a week. They are committed to investing 35% of all revenue in original Israeli productions, a minimum of NIS 308 million in the first year. The consortia are also committed to broadcasting original content for a minimum 40% of air time and may broadcast purchased content during the remaining 60%.
During the first six months of operations, the third channel will broadcast nine hours a day, commencing 12 broadcast hours a day in the seventh month, between 13:00-01:00. Beginning in the third year, there will be 18 broadcast hours a day, between 07:00-01:00.
The franchisees are also obligated to set up a news service in the second year of operations. Most of the participants had hoped this clause would be revoked immediately after the franchise winner was announced. In the first year, the franchisees may buy news from Channel 1 or 2, or from the 24-hour news channel.
Similar to the Channel 2 franchisees, the third channel are allowed 12 minutes of advertising time per one hour of prime-time broadcasting.
Who's who in channel 3
Eden Broadcasting: General manager – Motti Kirschenbaum
Owners:
Ehud Ben-Shach's Aba Communications – 20.3%;
Shavit Broadcasting, which is owned by contractors Ocif – 20.1%;
The Ordar group, owned by Avi Lerner and Dan Dimbort of Nu Image Films, Los Angeles – 10%;
Hanan and Miriam Zoglowek via New ComLine – 10%;
Eli Papouchado's Red Sea Hotels – 10%;
Minor shareholders Yehuda Talit's Talit Entertainment, Liora Landau's Omer Productions, Capital which is owned by Sharon Harel-Cohen and Ronald Cohen, and Sentinel Capital Ventures
Israel 10: general managers – Johanna Prenner and Ronni Algranti
Owners:
Yosef Maiman-controlled Swift concern – 40%;
Alfred Akirov's Alrov group – 20%;
Yosef Hackmey's Israel Phoenix – 13.5%;
Zalman Shoval's ICC Investments – 10%;
Dov Tadmor via the Saridav company – 5.1%;
Mediana, owned by Johanna Prenner and Ronni Algranti – 6.5%;
Anani Communications (4.9%), owned by Udi Miron, Iris Hod and Aviv Giladi – 4.9%.
The big losers Afik-Rom, comprised of Meimad-Tzena-MTVS group, controlled by Zeev Mozes, Eitan Abot, Leon Ziman and Eyal Kahn – 24%; Yitzhak Tshuva’s Delek Investments – 20%; Mivtachim Fund – 20%; the Ha'aretz group, controlled by Amos Schocken – 16%; the Rotlevy family and 3 PEN Technologies – 10% each.
Published by Israel's Business Arena on 18 April 2001