Binary package hint: ubiquity
Didn't notice what was happening. Was browsing the web with Firefox during install of Natty.
Marked to fetch updates and install MP3 codecs.
Set it to format and install to sda1 as / partiotion and sda2 as /home.
sda3 is swap.
Chose "Israel" keyboard layout and Jerusalem as time location.
Installation attempted from live USB made using unetbootin.