The Adelson Effect

Report from Israel
By Robert Slater with Wesley G. Pippert

Billionaire Sheldon Adelson is best known in the United States for his outsized contributions to Republican presidential candidates. But in Israel, where he owns two newspapers, he may wield far more influence.

By now, most Americans have heard of Sheldon Adelson’s 2012 ambitions to sway the American electorate and his current efforts to influence the selection of the 2016 Republican presidential candidate. Much less is known about the Las Vegas casino magnate’s growing influence in Israel. There, the 80-year-old billionaire has poured a fraction of his considerable wealth not into individual campaign coffers but into the media business, beginning with the creation of a new newspaper, Yisrael Hayom [Israel Today], which hit the streets on July 30, 2007.

The daily tabloid, handed out for free at coffee shops, gas and bus stations, apartment complexes, supermarkets, hospitals and campuses, was a brash, direct challenge to Israel’s paid mass-circulation Hebrew dailies—Yediot Ahronot, Ma’ariv and Haaretz. With Adelson’s backing, the paper had the financial resources to have the bells and whistles of a “real newspaper” while selling advertising at bargain rates. It didn’t take long for the free publication to find readers among Israel’s 8.1 million news junkies and upend the economics of the country’s newspaper industry. By 2010, Yisrael Hayom was Israel’s most widely circulated paper. In the last half of 2013, the market research company TGI found Yisrael Hayom to have a 38.6 percent exposure rate compared to 38.4 percent for the former number-one paper Yediot Ahronot, and 6.1 percent for Haaretz, sometimes called the New York Times of Israel. The once-prestigious powerhouse, Ma’ariv, had dwindled to 3.5 percent. A few months later, Ma’ariv ceased publishing.

“Adelson’s great wealth has created unfair competition between the free paper and the papers that cost,” says Dan Caspi, a communications professor at Ben-Gurion University in Beersheva. “No other publisher can compete with his deep pockets.” Caspi, like other Israeli media observers, blames Yisrael Hayom for the death of Ma’ariv.

Yisrael Hayom has also upset the delicate left-right political balance among Israel’s newspapers. In keeping with Adelson’s very public conservative political views, Yisrael Hayom is seen as supporting Prime Minister Benjamin Netanyahu so unabashedly that political wags dubbed the paper “Bibiton”—blending Netanyahu’s nickname, “Bibi,” with iton, the Hebrew word for newspaper. During the February 2009 Israeli elections in which Netanyahu’s Likud Party emerged the victor, a study by HaAyin HaShevi’it [The Seventh Eye], a respected online media watchdog that is part of the independent Israel Democracy Institute, found that Yisrael Hayom’s coverage was biased in favor of Netanyahu and inflated the importance of events that helped to promote him and Likud.

But Adelson, who declined to be interviewed for this article, has scoffed at the notion that the paper’s coverage is biased. “Everybody thinks I started the newspaper purely to benefit Bibi,” he said in a 2009 interview. “Nothing could be further from the truth. I started the newspaper to give Israel, Israelis, a fair and balanced view of the news and the views. That’s all. It is not a ‘Bibiton.’” Using similar language in 2013, he said, “What you read in our newspaper is a fair and balanced viewpoint not only about Bibi but about everyone.”

Publishers rarely admit to bias, and Adelson is no different. But his competitors are vociferous in their criticism. “By placing a dagger in the heart of the Israeli media, Yisrael Hayom has thus given Israeli newspapers much more of a right-wing bent—and it is getting worse,” says an executive from Yediot Ahronot. “Adelson simply brought ruin to the Israeli newspaper market, and the Israel politicians who benefit from its flattering coverage have allowed this unprecedented phenomenon.” Ben-Dror Yemini, a reporter for the now defunct Ma’ariv, goes further, accusing Yisrael Hayom of being “a danger to Israeli democracy.”

In March, Adelson took steps to expand his influence. For five million dollars, he bought a small but influential right-wing religious newspaper called Makor Rishon and Ma’ariv’s website, NRG. “The fact that he now owns the most popular right-of-center paper and now an even more right-of-center paper is of concern,” says Israeli journalist and media observer Shmuel Rosner. “Adelson has gone from the major player on the right to the only player on the right. For him to control all the voices on the right is not healthy for the Israeli debate.”

This drama is largely invisible to the vast majority of diaspora Jews, who are familiar only with Israel’s English-language publications such as Haaretz’s English version, The Jerusalem Post and the online Times of Israel, but know little about its Hebrew-language press, where coverage can make or break an Israeli politician. The complex story of Israel’s current newspaper war and Adelson’s role in it has its roots in the pre-state movements of political Zionism, in a landscape that is far removed from American journalism.

In Israel’s early days, political parties published their own newspapers. The workers’ Mapam party, for example, put out Al-Hamishmar; the General Zionist Party, Haboker; the National Religious Party, Hazofeh; and the Communist Party, Kol Ha’am. There were a few independent papers, but most of them had agendas, too. Haaretz, founded by the British military government in 1918 and purchased in 1937 by the wealthy German Schocken family, was generally anti-government. The English-language Jerusalem Post, established in 1932 as The Palestine Post, had a historical association with the Mapai party on the left. Yediot Ahronot appeared in the 1930s, and a group of disgruntled Yediot Ahronot employees launched Ma’ariv in 1948. 

The early papers agreed on one thing only: statehood. Otherwise, their viewpoints diverged widely, making it necessary for Israelis to read several dailies in order to piece together a full understanding of current events. But despite the cacophony of voices, it would be a misnomer to call Israel’s early press “free.” The emphasis was on nation-building, which meant some topics were off limits. Although the government was unsuccessful in its efforts to shut down Kol Ha’am (a landmark 1953 Israeli Supreme Court case), it was able to maintain tight control over what appeared in print.

It did this largely through a quasi-official Editors Committee, a holdover from the British mandate period that continued to play a role after independence. “The Editors Committee and the government were very effective in preventing information from getting to the public,” says Yaron Ezrahi, professor emeritus of political science at Hebrew University and author of the 2012 book Imagined Democracies: Necessary Political Fictions. “The notion that the public has the right to get information from the government was not very popular back then. The government treated the media as an unruly and infantile child.”

There was also widespread military censorship, and, caught between the censors and their own loyalty to the government, Israeli editors rarely undertook investigative journalism. Scoops exposing the government’s faults were frowned upon. One story of self-censorship has become legendary: When Ma’ariv reporter Ido Dissentchik, serving reserve duty, caught Moshe Dayan pilfering antiquities in the desert, he appealed to his father, Ma’ariv editor Aryeh Dissentchik, to print the story. His father said, “I can’t. There is only one Moshe Dayan. The country needs him too much.”

Security officials feared that the slightest revelation about the Israel Defense Forces (IDF) would help its enemies: “I don’t want to say censorship was draconian then, but the whole concept was different from today,” notes the current military censor, Sima Waknin Gil. “The concept was, ‘We will do anything to protect state security.’” Doing “anything” also meant barring journalists from writing stories of substance about the IDF or the country’s two intelligence agencies, the Shin Bet and the Mossad.

One Israeli publication was willing to challenge the status quo—Haolam Hazeh [This World], a leftist magazine edited by Uri Avnery from 1950 until it closed in 1993. Avnery went against Israeli media tradition by injecting society gossip and even publishing photos of naked women alongside serious articles denouncing the government. When censored, Avnery would publish a blank page to let readers know what had happened, or funnel the story to a foreign journalist who published it, thus freeing up Israeli reporters to use it.

Long ostracized, today Avnery is a belated hero to Israeli journalists. Says former Haaretz editor David Landau: “Uri Avnery rightly presents himself as a revolutionary figure who brought these values into Israel, because the tradition of Zionist journalism was very much these long turgid pieces supporting this or that—toeing the line.” Asked what it was like to be the sole voice speaking out against the government, Avnery, now 90 and still writing, says: “It felt good then. And it feels good now.”

“Adelson’s great wealth has created unfair competition between the free paper and the papers that cost. No other publisher can compete with his deep pockets.”

The media’s attitude toward the government, however, underwent dramatic transformation after the 1973 Yom Kippur War. Before the surprise offensive, government and IDF officials had reassured the nation that the security situation was stable, and military censors had kept journalists from publishing stories about Arab military buildups on the borders that might have alerted the nation. “The surprise, shock and trauma caused by the attack on Yom Kippur of 1973, accompanied by the loss of almost 3,000 lives, led Israeli journalists to vow they would never again rely blindly on official sources about security affairs,” says Hillel Schenker, co-editor of the Jerusalem-based Palestine-Israel Journal.

The democratic media that emerged after the 1973 war became part of the Israeli zeitgeist: combative, competitive, zealous in the pursuit of stories the government did not want published. As a result, the censor could no longer keep journalists on a tight leash. Ido Dissentchik recalls when his editor and father Aryeh Dissentchik told him regretfully: “We should have published your story.”

The Israeli media became even more aggressive after a 1989 Israel Supreme Court ruling that prevented the military censor from forcing the newspaper Ha Ir to kill an article critical of the Mossad chief by claiming there was “a danger of harm to state security.” The Court ruled that the only basis for not publishing news about national security issues was “near certainty” that genuine damage to Israel’s security would occur if the article appeared. In this case, the Court said, the story was embarrassing but did not meet the criteria. This paved the way for the Israeli media to cover all sorts of official failures, security and otherwise.

Armed with this ruling and, a decade later, the advent of the Internet—which made it harder for the government to keep information under wraps—Israeli journalists became freer to write about once-forbidden security issues. Today, stories that question the official version of events do see the light of day: Articles detailing Israeli military strategy, technology (such as the Iron Dome anti-missiles designed to intercept and destroy short-range rockets and artillery shells), IDF personnel and internal intelligence agency business reach the Israeli public. A recent example was the Prisoner X scandal (about the suicide of an Australian-Israeli citizen and possible former Mossad employee held anonymously in an Israeli prison), which broke after a government “media blackout” was lifted.

That said, there are still stories that languish in media blackouts or are never published. As in any democracy, tensions exist between journalists and the government. The Editors Committee is less significant, but journalists still have guidelines for stories that must be submitted to military censors who can prohibit certain stories—such as those about Israel’s presumed nuclear weapons—from being published. Some journalists complain that gag orders are issued too freely. But many journalists contend that the more ominous threat to a free press is economic.

Along the way, the nature of Israel’s newspapers changed. Some of the changes have reflected the rise and fall of the country’s major political parties such as Mapam, Labor and Likud and the government’s gradual move to the political right, reflecting shifting public opinion. As old parties morphed into new ones, old newspapers lost their readers, and new alliances were formed. In 1996, Davar—the organ of the Histadrut labor movement—collapsed, heralding the end of the era of the party papers. Left standing were the privately owned dailies

Adelson is not the first wealthy person with deep pockets and deeply held political opinions to throw his weight around in the modern Israeli media world. By the time he leapt into the publishing fray, all the surviving dailies had themselves become media empires, dominated by so-called oligarchs, as Israelis often refer to them. 

In 2007, when Yisrael Hayom started publishing, Arnon “Noni” Mozes, the owner of Yediot Ahronot, was the most powerful. The paper was officially independent and fairly centrist, but Mozes, who succeeded his father, Noah, as publisher in 1985, gained notoriety for not publishing negative articles about his favored politicians: For example, when the attorney general announced in 2009 the shocking news that former Prime Minister Ehud Olmert would stand trial on corruption charges, Yediot Ahronot buried the news in a tiny item.

Sheldon Adelson founded Yisrael Hayom in 2007.

On the left of the political spectrum is Haaretz’s Amos Schocken. He inherited Haaretz from his father Gershom, whose father Zalman—the head of a publishing conglomerate in pre-war Germany—had purchased the paper. In line with family tradition, Schocken is focused on pushing for peace and on Israel’s withdrawal from the territories. Readers who complain about his views get a letter back saying, “Perhaps Haaretz is just not the newspaper for you.” In 2008—when Israel turned 60—he published an article advocating that Israel’s national anthem, Hatikva, be changed because its lyrics spoke only to Jewish aspirations, not to Arab ones.

Ma’ariv’s heyday was from 1948 to 1968, during which it was the standard-bearer of Israeli papers, with the most readers. “Originally it was controlled by the right but developed close connections to the Labor party,” says Rafi Mann, a historian and media researcher who was a top staffer at Ma’ariv for 29 years. “Then for much of its history it was centrist but became left-center in the last decade.” It was fiercely competitive with Yediot Ahronot. In 1992, Ofer Nimrodi, an attorney and Harvard Business School graduate, became publisher and editor-in-chief. Nimrodi was convicted of tapping Arnon Mozes’s phone and served an eight-month prison sentence from 1998 through 1999, while remaining editor-in-chief of Ma’ariv.

Despite their rivalry, Mozes, Nimrodi and Schocken banded together when faced with the threat of a serious, free daily competitor. “I was in touch with the leaders of Israel’s media,” says media and political analyst Ezrahi. “They were scared stiff. One journalist told me he thought it would be the end of his newspaper.” There was outrage that a foreigner—and a casino owner at that—who spoke no Hebrew and had little knowledge of the country might be able to dominate Israel’s print media. (Adelson is married to an Israeli, Miriam Adelson, a physician, but they spend little time in Israel.)

“Adelson is different from the other media moguls,” says Caspi. Among the differences is that he isn’t “an Israeli living in Israel so will not bear the consequences of his agenda—for example, an attack on Iran.” On the other hand, says Noam Lemelshtrich Latar, the dean of the Sammy Ofer School of Communications at IDC Herzliya, Adelson has no major non-media financial interests in Israel, which means that he “cannot be blamed for using the paper to advance his business interests.”

Afer Yisrael Hayom had been on the streets for two years, Mozes, Schocken and Nimrodi, supported by politicians, sought to legislate the paper out of existence. They asked the Knesset to pass a bill banning foreigners from owning an Israeli newspaper. They were unsuccessful, but a new 2014 bill would prohibit free newspapers from publishing for more than a year on the grounds that they inhibit freedom of speech and are unfair competition. Analysts say passage is uncertain and that if the bill were to pass, Netanyahu might even step in to halt its enactment.

Some of what the media moguls feared has come to pass. TGI reports that despite Yisrael Hayom’s rise in readership, there has been an overall decline in consumption of print media, with the exception of the financial daily Globes. It would be unfair to blame all of this on Yisrael Hayom: As is happening worldwide, many readers and advertisers have moved online (where all the major Israeli dailies have a strong presence), and shrinking revenues have led papers to struggle to maintain large staffs and bloated budgets. “The basic problem is the Internet,” says Nahum Barnea, a columnist for Yediot Ahronot and winner of the 2007 Israel Prize. “We are an industry in decline.”

But Adelson, for whom money is no object, has compounded the economic problems of the Israeli press. Ma’ariv columnist Ben-Dror Yemini has likened Adelson’s impact to trade dumping: “Somebody with a lot of money gives people free bread. It drives the bakeries out of business until he is the only one— and then he can charge what he wants.”

Yediot Ahronot is not in danger of going out of business, but with its readership dropping, media observers agree that it has changed. “It’s still a better paper professionally speaking than Yisrael Hayom,” says Rosner, a former Haaretz correspondent, “but if you follow the headlines of Yediot, one gets the sense that it is more hostile to Netanyahu than before Adelson came along. One suspects that at times Yediot confuses its opposition to the Adelson paper with opposition to Adelson’s favorite, who is Netanyahu.”

Does the paper have a political agenda? Yediot Ahronot columnist Barnea says no, and insists it “is still very centrist… and critical.” He believes that Adelson is going after Yediot Ahronot. “His target is Yediot Ahronot,” he says. Barnea also suspects that “Adelson established Yisrael Hayom not to support the government but to support Netanyahu. We don’t know what effect Adelson has on Netanyahu. This may be more important than [Adelson’s] effect on the Israeli media. I’m really worried.” He continues: “I believe Netanyahu envisioned a paper much more modest—an organ, not a monster.”

While Yisrael Hayom has cut into Yediot Ahronot’s advertising, subscription and newsstand sales, the freebie has greater potential to harm Haaretz’s bottom line. Yisrael Hayom was printed at Haaretz’s printing plant until December 2013, when Adelson bought Ma’ariv’s printing house. This meant a loss of 15 to 20 percent of Haaretz’s revenues, which Yoram Peri, a former Davar editor-in-chief, now director of the Joseph and Alma Gildenhorn Institute for Israel Studies at the University of Maryland at College Park, calls “a major blow.”

“One of the very quirky things about the Adelson story in Israel is that he is probably the person that kept left-wing Haaretz alive for the last five years,” says Rosner. “Some Israelis and Americans on the right were very upset with him because of his decision to keep printing with Haaretz. This may have been part of his decision to move to a different printer.”

Should Haaretz collapse, the left would lose its strongest media voice. “Israel without Haaretz,” said Uzi Benziman, a former Haaretz columnist, “would be like Israel without the Supreme Court.” But Haaretz editor Aluf Benn contends that the paper’s share of readers remains constant and that its popular digital presence has positioned it well for the future. Benn also says that Haaretz will not depart from its basic principles of the past 60 years—“regulated free market and strong support for diplomacy over force. These have guided us for decades. I don’t see it changing.”

As for Ma’ariv, not all of its troubles can be pinned on Yisrael Hayom. It was already in decline in 2007. After 1968, many analysts agree that its shifting positions and a lack of focus turned off readers. But its deeper problem was poor and changing management. In 2010, Nimrodi sold the paper to high-tech entrepreneur Zaki Rakib, who soon sold it to Israeli businessman Nochi Dankner. (In 2012 Nimrodi became the CEO, president and general manager of the Israel Land Development Company, which his family bought from the Jewish Agency with the assistance of Ehud Olmert.) Dankner tried to keep Ma’ariv afloat with public bond offerings and used the paper to gain the support of those he needed in his battles with government regulators and creditors.

But in 2012, he sold Ma’ariv to Shlomo Ben-Zvi, a businessman in the West Bank settlement of Efrat, who owned Makor Rishon. Ben-Zvi promised to keep Ma’ariv’s brand, although his critics argue that he took the paper further to the right. The discussion became moot when Ben-Zvi sold the paper to Adelson. “As an independent paper, Ma’ariv’s story is over after 66 years. A sad story of continued mismanagement,” says Latar, the IDC communications dean. “It was a good paper.”

Ma’ariv is not completely dead. Adelson did not buy the paper, only NRG, its website. Ma’ariv itself was acquired by Jerusalem Post owner Eli Azur. Azur, along with a group of former Ma’ariv journalists who were pushed out when Ben-Zvi bought the paper in 2012, hopes to relaunch it. Rosner is not optimistic that the paper can regain its readers. “Ma’ariv,” he says, “is close to being a corpse.”

The more serious problem, says Rosner, is Adelson’s purchase of Makor Rishon, which consolidates Adelson’s influence by limiting media outlets for other politicians on the right who don’t agree with Netanyahu. One of these is Naftali Bennett, Netanyahu’s economic minister and leader of HaBayit HaYehudi, the Jewish Home party. Yisrael Hayom “is Pravda. A mouthpiece of one person, Prime Minister Netanyahu,” Bennett complained recently in an interview on an Israeli radio station. Bennett has repeatedly expressed concern about the sale, which is subject to review by Israeli anti-trust authorities, who are likely to approve it with some restrictions. “Bennett is a member of Netanyahu’s cabinet but hardly a Netanyahu supporter,” explains Rosner. “Makor Rishon used to be the paper through which he conveyed his ideas, it was his home court. Now that it is owned by Adelson, I suspect that it will no longer be the home court for someone who is so adversarial when it comes to Netanyahu. Adelson’s representatives in Israel have said that he will keep the paper independent and that he is not going to enforce the same policies and ideologies that guide Yisrael Hayom. But sometimes you don’t need the editor to say what he wants for the editors and writers to understand that the situation has changed. Bennett is probably right to be concerned that he won’t be able to have the same say. And when we have new elections, I don’t think that Makor Rishon under Adelson is going to be effective opposition to Netanyahu.”

This all points to how complicated the current Israeli media scene is: “It’s not merely ‘right’ and ‘left;’ it is the age of personal politics,” says Mann, who wonders about the possible long-term effects on the public of a widely read paper that eliminates or sharply downplays almost every claim or report that criticizes the prime minister. What would happen if Netanyahu, now 64, were to leave politics? Adelson has such a hard-line position on Israel, “he might pick another politician to promote his agenda in Israel. But what if Netanyahu takes a softer line toward the Palestinians? Then what would Adelson do?”

Not everyone in Israel believes that Yisrael Hayom is crippling Israeli democracy. David Landau, editor of Haaretz from 2004 to 2008, says it has its value: “It’s useful to know what the prime minister is thinking and saying. You know if it’s in Yisrael Hayom it’s more reliable. You know that their stories reflect the thinking of the prime minister and that they are reliable and accurate.” 

To Mann, the former Ma’ariv editor now at HaAyin HaShevi’it, Yisrael Hayom actually provides more balance to the Israeli political debate. “It’s a good newspaper—it’s not some kind of trashy free newspaper. It has content. The good thing is that it diversified the political discourse in Israel…before that, the three major papers in Israel were to some degree center-left; there wasn’t any newspaper in Israel that presented the positions in line with the majority in Israel, which leans to the right. A lot of people felt that no one [in the press] supported Netanyahu even though Likud was the party with the highest vote.” Former Davar editor-in-chief Peri agrees: “Yisrael Hayom gave the people what they wanted. Here is a newspaper that answers the ideological and political demands of the people.”

More diversity of papers with different political orientations is the answer, says BGU’s Caspi. “The most desirable situation would be a number of newspaper owners who are more or less equal, who express different views to ensure pluralism.” Latar agrees: “The existence of several papers with conflicting agendas is in the interest of the readers and democracy,” he says.

The sophisticated Israeli reader has always read more than one paper, a habit that will need to continue. Says Shmuel Rosner: “We used to have party papers, then we moved to independent papers that were seemingly bipartisan and now what we have again are party papers, but they follow party lines without being exactly honest about it. So when it comes to ideology, the current papers are not too different from those in the past. It is as if we have come full circle.”