Interactive explainer: five corruption allegations facing Benjamin Netanyahu
The investigators believe that the prime minister used his close aide Shlomo Filber, who spent three years as director-general at Israel’s Communications Ministry, to intervene in the regulatory process to the benefit of Mr Alovich's businesses.
In return, the investigators allege, Mr Netanyahu received glowing coverage on the Walla! website owned by Bezeq, at a time when the prime minister was also serving as communications minister.
Mr Filber signed a state witness agreement last week and is currently cooperating with the police.
The Israeli Prime Minister is also expected to be questioned over allegations that Nir Hefetz, one of his aides, approached a retired judge to ask whether she would be interested in becoming the next attorney-general in exchange for closing an investigation into misuse of public funds by Sara Netanyahu.
Mr Netanyahu is already the subject of two prior corruption investigations in which police have recommended he be indicted for bribery and fraud.
He said earlier this week that the latest allegations were “a new balloon” and that “all actions (of the communications ministry) were carried out in a proper fashion and based on the recommendations of the professional civil servants.”
Shaul Alovich and Nir Hefetz have been in police custody for nearly two weeks.