by Levi Shapiro

The first broadcast in Israel was a military parade in 1968. The first commercial television industry did not even launch until 1993. This limited home market has taught a generation of content creators to cut costs and look for growth abroad.

In the words of comedy writer Omri Marcus ('It's A Wonderful Country'), "we are like a sweat shop from the Far East- only instead of Nike shoes we make cheap and smart content".

The Israel Audience Research Board (IARB) estimates 1.7 million Israeli TV households, 20% of which are non-Hebrew Arabs. Early programming successes were either political satire or imitations of foreign formats. As one Israeli producer joked, "it isn't stealing if one Jewish comedian borrows from another Jewish comedian".

Today the market is fragmented, with a public broadcaster, two broadcast networks and an 80% penetration rate for cable (HOT) and satellite (YES). Primetime broadcast is dominated by reality, led by Channel 2, which actually has two concessionaires. Channel 2's Sunday-Tuesday line-up is controlled by "Keshet", while Wednesday-Saturday programming is overseen by a different company, "Reshet". Those days will reverse in 2010.

Keshet leads the ratings race with reality programs like "Big Brother", "So You Think You Can Dance", "It's A Wonderful Country" and a singing competition. More recently, Keshet has begun exporting formats. According to Keren Shahar, Head of Formats & Acquisitions, "four years ago it was hard to schedule meetings with international buyers. Now people want to hear about what we are doing". This includes "The Vault", which aired in 18 territories, "The Successor" with Uri Geller (ten territories) and "The Mythological X".

The undisputed King of Israeli reality and game show formats is Erez Tal, Executive Producer of The Vault, Host of Big Brother and the creator of many popular shows. Tal launched his career on IDF (Israeli Defense Force) Radio, which is popular with a national audience and where many Israeli talents launched their careers. "Israel is a good lab for formats. We know how to make cost-effective prime time".

The launch of DTH satellite in 2000 forced cable to innovate. According to Udi Miron, CEO of cable network group Ananey, "the worst thing you can call an Israeli is a 'frier' (sucker). So the cable industry heavily promoted VOD to demonstrate value". Today Israel has one of the highest VOD penetration rates in the world. "Consumers will pay for value. Kids programming does especially well on SVOD. We created pay channels for food, health, travel, lifestyle and are beyond break-even with all of them".

On the global market, mention Israeli TV to most buyers and they will probably respond "telenovelas". Dori Media Group is the world leader, distributing about 5,000 hours of telenovela content to 65 countries and 450 TV channels, including "Lalola" that was sold to about 60 territories in only one year. This includes 15 owned and operated channels in Indonesia and other markets. In order to leverage alternative platforms, Dori Media Group recently launched Novebox.com, a social media and networking site focused on telenovelas. Nadav Palti is the President & CEO of Dori Media Group. "Every day, two billion people watch telenovelas. This is a very stable genre and demand remains high if you effectively promote, package and program". In addition to distributing TV formats, Dori Media Group also produces about 1,000 new hours yearly in Argentina and Israel.

Israel's small size makes it difficult for Producers who don't export. Avi Armoza left his role as SVP at JCS, Israel's largest studio, to create Armoza Formats. The company has sold formats in Europe and North America. "Development is the most expensive and risky part of television. Many territories may not be able to afford US and UK formats. Israeli shows can fill that need". Armoza's approach integrates content and technology. For example, 'The Smart Ace' is an original poker trivia game show, designed for niche channels and off-primetime in combination with the web.

Hagai Levi never created his dramatic series 'Be Tipul' to get rich. "You can live very well in Israel off of reality and game shows, but not drama. The Producer who only produces drama will be in trouble". After years of producing telenovels, the Creator and Executive Producer wanted to combine his interest in psychology with a cost-effective format. "Psychology is my hobby and my illness. I have been in therapy all of my life".

The format was sold to HBO and the series "In Treatment" is now in its second season, racking up an Emmy and five Golden Globe nominations, more than any other series. Other versions are in production in France, Russia, Italy, Portugal and Serbia. "Except for Serbia, those countries have much higher budgets than Israel. If it wasn't for the overseas business, I would have lost money".

In Treatment is 'Israeli' in the budgetary sense. "My intention was always to make it on the cheap...two actors, one location. For the telenovelas, I could write one episode every day. I truly believed that was possible for In Treatment. In fact, I needed an entire month to write each episode. So development took me 1.5 years before shooting".

What remains to be seen is if scripted Israeli formats can maintain relevance abroad. "Some of the plot lines, such as the Fighter Pilot, are too Israeli. We all felt that the second season requires a much deeper adaptation to make it more culturally relevant". Localization includes an entirely local writing team and new Showrunner, Warren Light, who was the Showrunner for Law & Order, Criminal Intent.

Hagai is not sure that other Israeli shows will have similar success abroad. "All of this is unbelievable. I showed up at a unique moment when the American networks were looking for ideas from abroad". For now, international buyers looking for cost-effective and creative formats are learning to say "shalom" to Israel.

Permission TV commissioned a survey of 400 senior-level advertising, marketing and media executives to determine online video as a primary focus for digital marketing budgets in 2009.

A Few Key Findings:

More than two thirds of respondents (67 percent) identified online video as a primary focus of their 2009 digital marketing campaigns, versus social media campaigns (41 percent), search (34 percent) and podcasts/webcasts (32 percent).

In Q2 of 2009, more than half (52 percent) of respondents expect to be implementing or extending an online video project, whereas currently less than one-third (32 percent) are doing so.

Nearly 60 percent of respondents consider interactive video experiences to be the next evolution for online video. Also, 62 percent believe that non-linear, interactive storytelling will become the most effective medium for marketers. o Links to other videos is the most widely needed interactive capabilities for respondents, followed by graphic overlays, user comments and user-defined contents paths.

In his October article: Mobile Advertisers Demand Unified Measurement Standards, Levi Shapiro spelled out the some of the issues facing agencies and clients with respect to mobile measurement and the need for tools to quantify user viewing experiences.

You can see this lack of standardization reflected on slides one and three. On slide one 17.4% of respondents plan little to no spending for mobile. However, on slide three 49.9% of respondents see mobile as the next evolutionary step in content distribution. In addition, with the U.S. and the rest of world in recession the mobile handset market is facing a slowdown with analysts estimate a slip of 6.6% of handset sales in 2009 which will force a further downward pressure with respect to programming.

On slide two, there is an almost the same percentage of respondents 13.3% against 15.3% currently planning an online project verses those not currently planning. The picture does change in Q2 of next year with 8.6% planning an online project however, not by a wide gulf against 5.8% with no plans to implement the use of video.

According to the company, the survey was sent out on November 12th and closed on November 24th however, there were no questions specific to the impact the deep U.S. recession will have on 2009 budgets and projects, one must assume respondents built this into their answers.

Click on image to view slide deck

By Levi Shapiro

By combining engineering talent, access to capital and a start-up friendly environment, Israeli companies have made their country a leader in the mobile media sector. But ICQ founder and Angel investor Yossi Vardi has a different and more light-hearted explanation: the Jewish mother. "Nobody is harder to satisfy than a Jewish mother," he said, relaying an old joke:

Q: How many Jewish mothers does it take to change a light bulb?

A: (In despondent, motherly voice) Don't worry about me...I'll just sit here in the dark.

According to the Israeli Export Institute, Israel has the world's highest proportion of scientists and engineers with postgraduate education: 135 per 10,000, compared to 78 per 10,000 in the United States. Many engineers were first exposed to advanced communications technologies during their mandatory three-year military service, followed by degrees at world-class engineering universities such as Technion, Tel Aviv and Bar Ilan.

Continue reading: Mobile start-ups thrive in Israel

Vudu sent us their Video on Demand BX-100 box to test and we spend plenty of time viewing titles and playing with the UI, enclosed is a review of the system. In addition, on November 18th, the company released their XL2, a single space rack unit designed for professional home theater installations. With a terabyte of storage space, or over 500 films, the XL2 provides IP and IR control that allow it to be integrated into most high-end home control systems (for example, systems by Crestron would be in this class) Also, with 1080i HD output over component, the ability to route and switch HD signals through the home with the use of off-the-shelf video switchers. What's the bottom line? While not a technical or measurable term, I have to say the image quality especially with respect to their HDX content was stunning...