World Jewish Congress president and heir to Estee Lauder faces a decision: inject NIS 60 million into the ailing commercial TV station and assure its future, or begin the process of shutting it down.

Ron Lauder finds himself alone again in the battle for the future of Channel 10 television, after negotiations with potential investors broke down this week.

Lauder, who is president of the World Jewish Congress and heir to the Estee Lauder cosmetics empire, has a 25% stake in Channel 10. He is faced with a decision over whether to inject NIS 60 million into the ailing commercial TV station and assure its future, or begin the process of shutting it down. Even closing the station, industry sources say, would involve Lauder having to pay out about NIS 60 million to Channel 10´s suppliers, employees and creditors.

The station owes another NIS 60 million to the state and additional sums to the Arigo Fund and the Israel Film Fund, but those sums are personally guaranteed by Yossi Maiman, the station´s majority shareholder, who has a 51% stake in Channel 10.

At this stage, the prospects don´t seem bright that the debt to the state will be deferred or converted into a commitment to invest the sum into program content. Sources at the station point an accusing finger at Prime Minister Benjamin Netanyahu.

Although the prime minister´s ties to Lauder have warmed recently, it does not appear that Netanyahu is willing to have the state come to the station´s rescue. In the past, sources at the Prime Minister´s Office have denied that Netanyahu´s bureau has been involved in any decision making regarding the station.

In the current regulatory environment, if the station cannot meet its debt obligations, it will not be able to renew its broadcast license for 2013 and will be forced to close.

If the matter is sent back to Attorney General Yehuda Weinstein´s office, however, Channel 10 may be able to continue operating, industry sources say. At the end of 2011, Deputy Attorney General Avi Licht issued a controversial legal opinion contending that the station could indeed continue operating, even if it did not pay its obligations to the state on time. Sources suggest that Channel 10 could continue to broadcast if another legal opinion were issued stating that the station could be given permission to broadcast for another year, based on its current license, if it puts its debt in order during that time.

Sources at Licht´s office said they are not dealing with the matter at the moment, but sources close to Lauder have expressed a measure of optimism that the station will stay on the air. Lauder´s staff has begun refilling the ranks of the station´s management, following departures in recent months that were caused in part by Channel 10´s uncertain future.

Among those who would need to be replaced are Yossi Warshavsky, who resigned as CEO of the station in May. Lauder has an interest in about 30 television stations in Eastern Europe and is apparently considering bringing in someone from abroad to fill the CEO position to direct the content side of the station. However, observers say that when it comes down to it, the prospect of such a move is slim. The station is expected to start cutting costs soon, probably including additional salary reductions, particularly at the highest levels, where some staff, including on-air talent, enjoy salaries that are more generous than the industry norm. (© Copyright 2012 Ha´aretz 08/05/12)