Following the passage of Amendment 25 to the Telecommunications Law (1982), which forbids the broadcast of pornographic content packages, cable companies Golden Channels and Tevel have decided to postpone marketing of tiering packages. The marketing launch was scheduled for next week.
Golden Channels postponed tiering and marketing of tiering packages for one week, canceled a press conference on tiering, and will not advertise prices on Sunday morning, as was originally planned. The measures were taken, the company said, as it must now wait for the law to be published in legal gazettes, and change the content packages accordingly.
Tevel too, planned to begin tiering early next week, but suspended the matter and will examine the legal ramifications of the process this week.
Golden Channels this year began offering 10 pay-per-view movie channels. The company is now looking into expanding the selection of adult films offered on pay-per-view.
Tevel has, for several years, offered the Home Cinema pay-per-view movie service. During the past year Tevel began offering adult movies every night between 10:00 PM and 4:00 AM. The two companies believe that the newly amended law does not apply to pay-per-view services.
Matav-Cable Systems Media (Nasdaq: MATV) already sells a tiering package that includes two Playboy channels. According to Tevel VP marketing Doron Admati, after the new law is published in gazettes, the Playboy broadcasts will be suspended and the company will market other content packages, as originally planned for August.
YES CEO Shlomo Liran said the company will honor the law from the moment it went into effect, and that the sex channels will cease to exist. However, he said, "the pay-per-view service, as I understand the law, will not be affected and we will find a way to offer our subscribers the same service at the same price so as not to affect them."
Play TV chairman Yair Hasson, representative of the Playboy Channel in Israel, believes that the bill passed yesterday applies to pornographic movies, while Playboy broadcasts erotica and not pornography.
Hasson further said he was horrified by the new law. As an Israeli citizen, he said, he found hard to accept the law, given that the channel was encrypted using a secret code, and broadcast only after 10:00 PM.
One week ago, Playboy Enterprises acquired US adult entertainment channel Vivid for $70 million. Vivid is represented in Israel by Mega TV, owned by Ziv Sidi. As part of the deal, Hasson has the option to acquire 50% of Vivid Israel from Sidi. Tevel and Golden Channels both offer Vivid content.
According to Golden Channels' data, 80,000 households subscribe to its digital service, of which 50% have requested adult entertainment. 70% of households ordered the expanded tiering package which includes three channels with pornographic content (Playboy, Spice and Vivid), compared with the regular package offering only two adult channels (Playboy and Spice).
Tevel figures also cite steady demand for adult content from 73% of 79,000 households with digital set-top boxes. Tevel further said that 45% of films viewed on Home Cinema were pornographic.
175,000 households subscribe to Satellite company YES, of which 50% subscribe to the adult entertainment package.
Published by Israel's Business Arena July 26, 2001.