With Dubai preparing to host the Expo 2020 and Qatar set to host the 2022 FIFA World Cup, the Middle East’s events industry is under the spotlight more than ever. The UAE, and particularly Dubai, has blazed a trail in terms of developing its events industry, with big name bands and performers now a staple of the country’s entertainment scene. Regular sports fixtures including Rugby Sevens and the Abu Dhabi Formula One are also helping to grow this area, as are new venues including Autism Rocks and Dubai Opera.
But the region’s events industry is about far more than big ticket sporting events and mega-concerts. In reality, a major proportion of it is accounted for by smaller and medium-sized events such as corporate meetings, incentives, and exhibitions.
As Chicco Hiranandani, senior manager, Shure MEA points out during the roundtable, Fortune 500 companies such as Facebook, Google, Boeing and Apple are all users of Shure’s ULXD microphones in tech rooms around the world, and this is a side of the business that Shure expects to keep growing.
Data from international research houses also indicates the potential of the region’s broad events industry. Indeed, a report from Infocomm predicted that the global AV business would be worth $114 billion in 2016, up from roughly $91.8 billion in 2014. It also indicated that about 4% of the total value would come from the Middle East, which would value the region’s AV market at roughly $4.7 billion this year.
Based on the Infocomm report, 33% of this $4.7 billion sum is service-oriented, which equates to roughly $1.2 billion. Rental and staging represents about 15%, which is worth about $200 million.
The numbers are broadly backed up by research from EMI (Euro Monitor International), which stated in a recent report that the AV industry in the UAE is worth about $600 million, of which 50% is rental.
But while general perceptions of the industry and in-depth research point to a bright future, it is also clear that many challenges persist. Furthermore, some of these challenges could be magnified as the industry grows, unless acknowledged and addressed in a mature way by event professionals across the board.
This was certainly one of the key reasons for bringing these experts together at the Shure and Sound & Stage Middle East Roundtable. The event kicked off with each of the attendees sharing their perspectives of the current state of affairs, including the main challenges that are manifesting themselves. As an events consultant and president of ILEA Middle East chapter, Lee Charteris has a particularly strong overview of the region’s events industry. He said that in the UAE, there is a growing commercial attitude as players realise that the events must commercially viable if the industry is to grow and develop in a sustainable way.
“The challenges that I've witnessed, particularly in the UAE in the last few years, represent a wake-up to commercialism in the UAE. When I first came here, there was a very 'make it happen' kind of attitude with less of a focus on the bottom line. I think the UAE has become much more of a commercial territory for suppliers. I think it’s much more of a buyers and sellers market than was prevalent when I first started here,” he said.
Charteris added that conferences and exhibitions appear to represent a growing proportion of the region’s overall live events industry. Acknowledging the slowing economic growth of the Gulf region, Charteris added that if a temporary dip does take place, it is likely to affect live events more than corporate meetings and exhibitions.
“Although we haven't really owned up to it, I think there is potentially a little dip in the market again at the moment. Q3 and Q4 are going to be quite interesting in the UAE and that obviously will have an impact on audio in the long term,” he said. “I think the spending on live events is potentially going to decrease even though the event industry spend is going to become greater. That would probably be because of artist fees and all the other things that make up live concerts.”
Whether growth in the industry increases or plateaus, suppliers, rental companies and events organisers could help to mitigate the effects of a potential decline and also maximise their chances of benefitting from growth in other areas of the industry by diversifying their offerings.
Andy Jackson, general manager for the Middle East at audio specialist Delta Sound, said that part of his job is to look at where the business is heading in the next two to five years’ time. “As much as I believe that the short term is critical for cash flow, for the business it’s really about what we're going to be doing in five years’ time,” he said. “Are we going to be doing less concerts? Will most people be on their phones watching it at home? I don't know but I guess there's a possibility.”
Amid this level of uncertainty, the best strategy is diversification. “From our point of view it’s about diversity. While we're a specialist audio company, there are other areas that we've turned to, to fill the gaps and make sure that if one part of the business is dipping down, we've got some other revenue to rely on,” Jackson said.
He added that the reason Delta Sound set up its system integration business was partly to tap landmark events that are set to take place between now and 2022. “We feel that there is a reasonable business opportunity to get involved with; we bring some of our live event expertise to some of the installation work and distribution as well,” Jackson said.
While diversification can help companies in the medium- to long-term, the current downturn in the economic cycle does present some challenges that are trickier to circumnavigate. John Parkhouse, head of audio, eclipse Staging Services, has 10 years’ of experience in the UAE’s live events industry, and is familiar with the challenges. He said that while the market was poorly supplied with live event tech a decade ago, the situation is very different today. With more high quality equipment available from a growing number of providers, margins are under pressure. Add to this a cooling economy and it is easy to see why business can become more complicated for suppliers.
“Now we're expected to supply cutting edge equipment and people along with it,” Parkhouse says. “The prediction that the market is going to dip a little makes it more difficult to keep up with the next technology.
With expensive and higher end technology you have to justify the cost and demonstrate ways in which the demand is present in order to meet the supply.”
To this end, Stefano Duchi, general manager at event management company Giochi di Luce, said that it is important that people from all sides of the industry communicate with each other. “It’s important that technology manufacturers listen to people like us in order to improve quality, because if we win you win, and vice versa,” he said. “The link between the manufacturer and the end user is a key point.
“Events production companies have to be much more focused on what they're doing and also be more innovative. You have to know the latest tech in the market and be able to handle it,” he added.
While the amount of physical equipment has risen in recent years, the availability of talented professionals to handle it and serve the industry has not risen in a linear fashion, and here lies a significant problem.
Stefan Wieland, a freelance events production director, was vocal about the challenges presented by the calibre and availability of staff in the region. However, the challenge is more complex than there simply being a skills shortage in certain areas of the industry.
“We need to see two aspects. On the supply side, we have very well educated and skilled people. On the agency side, they sometimes don't even know the microphone from the speaker; this is the reality,” Wieland said. “Over the years, many people have tried to educate the agency guys, but the problem is that there is a high fluctuation of individuals within the agencies. Someone who works there now will be working somewhere else three months down the line. So there are a lot of people who you try to educate but then they are gone in no time. There are a lot of freelancers as well who don't really bother to learn, they just get booked and that's it.”
This lack of knowledge and industry awareness has an impact not only on events but also on manufacturers, distributors and rental companies, as Wieland explains. “In terms of the market, few of the agencies know what they're ordering. None of the procurement people know what they're signing off. From a commercial standpoint I understand that these guys want to have a working audio system and they don't care what brand or system they’re ordering.”
Stefano Duchi agrees that staff at the “procurement offices” who are responsible for buying equipment often lack sufficient knowledge, although they do seem to understand the need to drive a hard bargain.
Bruno Vitanza, technical director, Almoe Group, a supplier and integrator of equipment and technology for events, is also familiar with the problem of finding skilled staff. “It can be a big challenge to find a candidate who can handle the pressure of setting up equipment; the pressure of knowing the theory behind everything that you are setting up; who has the ability to be present, and to talk to the client in the correct way. To have that recipe together can be a big challenge. Sometimes we have to find freelancers and the local market can be very limited.”
Training is key
However, while Wieland and Vitanza articulated the frustrations felt by many around the table, there remained room for optimism, and all of the participants agreed that better training and education is the order of the day.
“From an ILEA point of view, the more training programmes that happen the better,” Charteris said. However, training should also be complemented by a healthy dose of real-world live events experience, according to Charteris, who cut his teeth working for British punk band The Clash in the late 1970s.
“The school of hard knocks is where we all started. Our training was from making mistakes on the road or in venues or at events. I do believe that there is a lot to be said for that and I think our industry is founded on that but I do believe that we could have avoided those pitfalls with a suitable training programme.”
Sharajan K, an executive with Dubai-based distributor NMK Electronics, has seen first-hand the gulf that exists between manufacturers and end users, and he sees education as an important means of addressing it. “As a distributor in the market we know the importance of education. We get very good support from the manufacturers’ side and we frequently conduct seminars and road shows in the region,” he said. “Especially for new products like Shure Axient, a high-level microphone system, you need to learn how to manage spectrum and other things about the technology. That's one of the reasons why we frequently do seminars and road shows.”
Jackson added that Delta Sound conducts its own internal training and that its growing confidence and ability in this area has led the company to help train people for other organisations. “Anyone that joins our company does health and safety training. We learn from every training session and identify the changes that we can make,” he said.
He also agrees with Charteris on the importance of real world experience as part of any training schemes. “The best way to get somebody ready is to put them on a job in front of a client where they are expected to get involved, but also have a proper relationship with the end client. You need to have the right technical skills and also be able to hold a conversation with customers or suppliers,” he said.
Chicco Hiranandani said that Shure recently restructured its global training activities. “This year we introduced the Shure Audio Institute and we're trying to make sure that there is a consistency across the globe. So if you go to a Shure training session in the US or Hong Kong, it should be more or less the same.”
He added that Shure is also dividing its training into three tiers, where Tier 1 would be less about the product and more about the theory and basic knowledge of a product or category and how it works. Tiers 2 and 3 become progressively more product focused, allowing the trainee to learn about specific products in-depth.
Andrea Granata, technical support engineer at Shure MEA, spent 15 years touring as a sound engineer and now sits on the other side of the fence. Part of his role is to help educate clients including end users and distributors. He adds an important and often overlooked point about training: that it is not just for entry-level or intermediate staff but also to update the knowledge of more seasoned professionals.
“For some advanced trainings, the professional might be far more interested in the technology than theory. For example, an engineer might be looking for a few hours dedicated to understanding how to manage an event with 120 wireless microphones. They need to know how that given software can help him reach a given target,” he said.
Perhaps the most interesting live events initiative built around the premise of education in the entire Gulf region is Oman’s Royal Opera House Muscat. Bruno Da Silva, deputy head of sound and broadcast at Royal Opera House Muscat, flew into Dubai to attend the Shure and Sound & Stage Middle East Roundtable. Da Silva said that Muscat’s opera house was established, to a large extent, as an “educational project”. “His Majesty [Qaboos bin Said al Said] put all his effort in to build the venue to engage primarily with Omanis,” he added.
One of the main priorities at the opera house has been to engage with local students, not only to encourage interest in music, opera and theatre, but also the business and craft of staging live events.
“We are trying to engage with Omanis in terms of employment. The aim is that the technical crew eventually will be half expats and half Omanis. We know this is a big challenge,” he said.
To achieve this Da Silva and his colleagues have started developing various in-house projects, some of which are being fleshed out on paper while others are being put into practice. “We've had some internships already and from there we've started to employ technicians. The goal is to develop training with manufacturers with the support of suppliers,” he added. “Something that we will be trying to push in Oman is to work closely with manufacturers and suppliers to develop training programmes where we can allow them to promote products to engage with local professionals in the region. Venues like Royal Opera House Muscat can provide the spaces and facilities which will help this happen. These opportunities can be used to promote various levels of training right from the foundation level to the higher levels.”
For Charteris, the increasing interest that suppliers are showing in terms of training events producers “demonstrates the maturing industry” in the UAE. “I can remember the time when I started here whereby a supplier's inventory meant what kit he had on the shelf. Now suppliers, in their sales pitch to producers, will explain about the training that they are involved in,” he said.
Far from being perceived as a cost, suppliers will increasingly see the benefits of training and will come to view it as more of a “revenue centre” that will help to develop the industry and lead to a virtuous cycle that contributes to sales, according to Charteris.