Tech entrepreneur Nir Zuk's new media channel Relevant has in recent months been hiring celebrities and talents for the venture, which is defined as an Israeli version of MSNBC - a streaming service covering news and current affairs and business from a liberal viewpoint. Relevant insists that "The way the story is told must also change," and is focusing, at least in its first phase, on op-ed clips aired on social networks. The channel is headed by Modi Frydman, one of the founders of Israeli commercial TV company Keshet and formerly CEO of Channel 10. Tali Ben Ovadia, who founded the news companies of Channel 2 and 10, and Shilo de-Beer, former editor of Yedioth Ahronoth, were hired for the senior editorial positions.
Senior figures who are close to Zuk say that Relevant is the tech entrepreneur's liberal reaction to Channel 14, which is identified with supporting the current government. However, Relevant's business model will be different from Channel 14, which is based exclusively on live broadcasts, while Zuk's venture plans to produce documentary content and satirical programs. Zuk is described as the spirit behind the project, and his investment in it, estimated at tens of millions of shekels, is intended to be sufficient for its establishment and operation for two years. According to sources familiar with the details, the entrepreneur frequently visits Relevant's offices, familiarizes himself with details about programs and pilot projects, and takes an active role in the venture. This is facilitated by the fact that Zuk's own office is adjacent to Relevant's offices.
The market conditions are not good
Relevant plans to generate revenue from advertising, and Yoram Baumann, a friend and neighbor of Nir Zuk in Tel Aviv's Tzahala neighborhood, recently liquidated all his holdings in the advertising company he founded, now known as Publicis Israel, has been appointed chairman. "Globes" learned that Baumann has met with two Israeli advertisers to explore the possibility on advertise on Relevant's streaming app. They were skeptical. Advertisers will not be able to commit to budgets of more than a few hundred thousand dollars in the first stage. So in the foreseeable future the channel will struggle to cover expenses by only relying on the Israeli advertising market. The launch of the project, which was planned for July, has now been postponed until after the holidays in October. This is also a difficult time for the media with the advertising pie shrinking through saturation on new media.
TBWA advertising agency partner Nevo Carmi told "Globes," that Relevant has not yet revealed its model to all market players. "They may have interesting models in the long term, but the situation in the advertising market in the short and medium term is not simple. The market is now experiencing a slowdown, the protest in the country influences all these factors and it is not a good environment. There are currently not good market conditions for establishing platforms that are based on advertising budgets."
Keshet and RGE are having trouble attracting large numbers of subscribers and are forced to use a lot of advertising time to promote Channel 12's Free TV venture. Keshet's technology news venture, Tech12, has been forced to lay off most of the employees and merge the site into N12. The Yedioth Group is also currently in the midst of a wave of layoffs that includes dozens of employees, and is conducting a massive battle against the journalists' union. At the same time, those close to the new venture claim that the media market never freezes, and renews itself every few years.
The expected audience is limited
In recent months it seems that Relevant is picking up employees on a daily basis from leading Israeli media outlets. At first they tried to hire top talents like Shaul Amsterdamski but such recruitments were postponed due to the concerns of many about betting on a new media venture shrouded in uncertainty. Nevertheless a range of top journalists have been hired as well as venture capitalist Eldad Tamir who will present a Jim Kramer-style Mad Money program. Then there will be satirical programs led by Lior Schleien, one of Relevant's founders.
In the 18 months since the venture was established, offices have been set up on Tel Aviv's Yigal Alon Street with two large studios and modest editing rooms. Nevertheless, the likelihood is that at least in the first stage Relevant will draw a very limited audience because the channel will come to market in a limited package: a free-to-download streaming app. So those who want to watch it can only do so via smart TVs or phones. The application will operate in a model similar to that of Kan or Keshet's 12+, and will offer live broadcast content that is expected to run from afternoon to night, and recorded content from VOD libraries.
Until the app is launched, it seems that the strategy to raise awareness about the channel will be done through videos that will be distributed on social networks, a model reminiscent of Kan in its formative stage although, unlike Kan, Relevant is about content of a distinctly liberal nature and here it must compete with existing channels such as 12, 13, DemocraTV and Haaretz content.
"New players take a long time to generate exposure and new audiences, and advertisers prefer to avoid dealing with such minor players," says Carmi. "It is possible that we will see good news in the form of lower advertising prices, but there is no great value to low advertising prices when the coverage potential is low. The coverage potential of channels like 24, 9 and Channel 14 is extremely low and so they struggle for the advertising budgets. If most of the model is based on advertising budgets, it has no commercial feasibility and they will have a very complex challenge," he adds.
"Who believed in Channel 14?
Until advertising is launched, the project will continue to rely on Zuk's money. However, even after that, the fact that Relevant is not integrated into the television services of the major telecom providers will significantly limit its audience. However, the channel is apparently not looking for a particularly large audience, and sees itself as a boutique project aimed at a very segmented audience and as an experimental project aimed at a young audience. The channel does not plan to launch text articles alongside the video content, but will stick to filmed content only. The venture has several dozen employees and has no plants to grow, and will operate from a modest offices with camera equipment, some of it second-hand. The senior management of experienced media people is balanced by a fairly young team experienced in creating and distributing content on social networks.
Senior media figures say "viability of a new channel cannot be completely ruled out, after all, who believed that Channel 14 would reach where it did when it was launched as Channel 20?", and yet, this is a gamble. Nir Zuk has invested several tens of millions of shekels in the project, but does not expect his investment to go down the drain. As a tech entrepreneur, he also knows how to quickly change course of action or cut losses when necessary. This is also the attitude with which many employees of the project bring to the new venture. It is an adventure or an experiment that may turn into a success story, or end in a short time as stinging failure and be closed down.
Published by Globes, Israel business news - en.globes.co.il - on October 5, 2023.
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