Greidinger confirmed the news, adding: “We asked the council for a permit for two to three new movie channels. To the best of our understanding, the council has reached a positive decision and we are now waiting for the license. Once we receive it - barring unforeseen complications - we will be on air in six to eight months.”
Greidinger also confirmed that his company is negotiating with major U.S. studios on distribution rights for their movies. “Forum Film has about 800 movies that can be put to use. We will air a variety of films, from blockbusters to art films to Israeli productions.”
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Sources in the television industry say Greidinger will probably approach HBO first and propose that they create a local movie channel together.
A cinema dynasty
Moshe (Mooky) and his brother Israel Greidinger are the third generation in their family’s Israeli movie dynasty. They own the Rav Chen and Yes Planet movie theater chains as well as the movie distribution company Forum Film, and a large distribution firm that operates in Eastern Europe under the name Cinema City.
The Greidingers distribute Disney movies and DVDs in Israel, and Sony Pictures/ Colombia DVDs. They also do a bustling business with the multi-channel television companies to whom they sell films, especially Yes. It’s reasonable to assume that their new venture, which will compete directly with the movie channels of Hot and Yes, will be a source of tension.
The mobile communications operator Partner (Orange) has also indicated interest in operating a movie channel. The company had considered establishing a movie channel on multi-channel television, but shied away due to the restrictions imposed by the government. Now that the regulations have been removed Partner can revisit its plans. Like the Greidingers, Partner has a large stock of movies ready for use, originally acquired for airing on its Orange Time Web site. The company may well decide to try and extend its brand name to television operations in this way. Partner declined to comment for this article.
The Cable and Satellite Council had prohibited the operation of private, independent sports, children’s and movie channels to protect the revenues of Hot and Yes. Yesterday’s change affects movie channels only.
“According to an expert financial opinion submitted to the council, the issuing of special licenses for movie channels, while contributing to the variety of the movies available for viewing, will not substantially increase the price of the content or jeopardize the financial condition of the cable and satellite companies,” the council announced.
“In addition, the council has decided to reduce the burden of investment in original productions for license holders.” the council added.
Saving money, too
Cable or satellite television subscribers can purchase private channels separately, regardless of the package to which they are subscribed. Private channels for health, travel, cooking and other niche interest are already in operation.
A source familiar with the television industry notes that with subscriber fees for such channels ranging between NIS 10 and NIS 20 per month, around 200,000 paying subscribers are needed to be profitable.
The private channel companies operate on a profit-sharing model with the cable and satellite companies. Channels with more specialized focus than movie channels, such as health or travel, have managed to attract a sufficient number of paying subscribers.
The Cable and Satellite Council announced that license holders would not be required to invest in original, local television productions for the first two years of operation, after which they will be required to invest between 4% and 12% of their annual revenues.
The exact rate is to be decided by the council, which will weigh the number of subscribers, the operator’s market share and other considerations.
