Sources inform “Globes” that cable television Channel 9, a Russian-language channel, made its first-ever monthly profit in December 2004, but the channel still finished the fourth quarter with a loss.
Channel 9 said in response, “The channel is a subsidiary of Africa-Israel Investments, a Tel Aviv Stock Exchange-listed company, and we therefore have no intention of commenting on specific figures. The channel’s financial data will be published together with the complete financial statements of Africa-Israel.”
Channel 9 (formerly Israel Plus) is expected to reach break-even in the first two quarters of 2005, although Africa-Israel CEO and Channel 9 chairman Pinchas Cohen previously predicted that the channel would break even in the fourth quarter of 2004. The channel recently reported a number of developments that could explain the improvement in its financial results, such as better ratings and more advertising.
Africa-Israel (42%) and Africa-Israel controlling shareholder Lev Leviev (42%) control Channel 9, which has been losing money since it was founded in 2002. The channel’s accumulated losses are estimated at NIS 120-130 million, including NIS 19.5 million in the first half of 2004, compared with NIS 31.8 million in the first half of 2003.
Channel 9 went on the air in November 2002 as Israel Plus. The channel is a designated channel with the same revenue model as Channel 2, based on selling airtime for advertising. Channel 9 recently reported that its airtime sales for advertising rose 41% in 2004. One reason for this substantial increase is that the Council for Cable and Satellite Broadcasting forbade ORT, a Russian channel that broadcasts in Israel, to include advertising directed at Israelis in its broadcasts, a ban that is still in effect.
The Council for Cable and Satellite Broadcasting permits, however, foreign Russian-language channel RTVi to broadcast advertising directed at Israelis totaling up to 25% of its advertising. RTVi broadcasts in the US, and most of its broadcasts are not specifically directed at an Israeli audience.
Published by Globes [online] - www.globes.co.il - on January 18, 2005