The Middle East and North Africa will see its pay-TV market grow by 38% over the next six years, according to a new report from Informa Telecoms & Media, with the number of pay-TV subscribers expected to increase from 5.1 million at the end of last year to over 7 million by 2013.
Much of this growth in subscriber numbers is expected to come from Israel and Turkey, which will account for 4.3mn pay-TV homes between them at the end of the period according to the report, entitled 'Middle East & Africa TV (5th Edition)'.
Furthermore, 61% of homes in the region were found to have a multichannel TV service at the end of last year, and this total will increase by 14mn households over the next six years to result in a penetration rate of 72%.
This increased penetration is expected to be the stimulus for a major increase in the region's advertising revenues, which will grow by 73% during the forecast period from US$1.9bn at the end of 2007 to US$3.3bn in 2013.
Adam Thomas, media research manager for Informa and author of the report, said: "Middle East TV benefits from several encouraging factors, such as the common language and culture for much of the region and a tradition of high TV consumption. Macroeconomic factors are generally positive too and an expanding and young population is creating a media-positive environment."
While the overall picture is generally positive, impediments to more impressive growth include the disparity across much of the region between the disposable income of a wealthy minority and the rest of the population, with operators targeting only a relatively small proportion of wealthy locals in addition to a sizable expatriate community, restricting the prospects for profitability.
"Some of the major TV operators are making losses and seem to be some way off financial self-sufficiency. But their heavyweight financial backers appear content to continue funding them indefinitely.
The difficulty with this situation is that operations with a non-commercial objective compromise those with commercial strategies, so distorting the market to an extent," added Thomas.