Tracey Grant, program manager, digital media and broadcasting, MEA, IDC Middle East, Turkey & Africa, offers her take on the region’s broadcast sector in 2015.
DB: What were you impressions of 2015 from a broadcast perspective?
TG: The MENA broadcast industry finds itself in the eye of a storm, with 2015 characterised by a state of constant flux. There have been some seismic shifts in the region’s broadcast ecosystem; regional OTT providers are launching thick and fast, the IPTV offerings from GCC telcos are beginning to compete directly with Pay-TV offerings, and the duopolistic Pay-TV giants of OSN and beIN Entertainment are now both negotiating entertainment rights. The broadcast market’s major players are now more focused than ever before on striking a balance between investment and subscriber acquisition, and the year to date has brought about changes across the entire broadcast ecosystem as global trends have filtered into the market and been tweaked to reflect local nuances. An increase in the variety of content choices, price points, and delivery options are all great news for consumers, and IDC expects 2016 to see a consolidation of services and ambitious monetisation plans from broadcasters.
DB: What were the main challenges in the industry in the past year?
TG: The core challenges remain the same, with a few new contenders thrown in for good measure. Piracy, the scourge of the Middle East, continues to impact the industry on a large scale. However, we are beginning to see strategies implemented by broadcasters to try and curb it. OSN and MBC have played a fundamental role this year in educating consumers and applying significant pressure on regulators, and the result has been a number of successful anti-piracy raids and the disruption of DTH overspill services. There has also been a movement towards questioning advertisers that continue to buy spots on FTA channels that transmit pirated content.
A more recent challenge to broadcasters in 2015 has been the saturation of OTT providers across MENA, and we see no signs of this trend letting up in 2016. While a Netflix launch in 2016 is almost inevitable, together with the launch of studio-specific owned and operated SVOD services, local OTT providers that are already in this market are honing and reviewing their strategies in order to complete effectively with the more dominant global players. The digitally native, mobile-first audience that characterises much of the MENA region continues to challenge delivery, experience, and technical aspirations of the major broadcasters, and the result is the implementation of more elastic and intuitive systems aimed at addressing these continually evolving wants and needs.
DB: What was your perception of the overall business climate in 2015, and what were the biggest milestone?
TG: Given the current state of the region’s geopolitical environment, it is hardly surprising that the business climate is also in a state of flux. However, content, entertainment, and mobility continue to dominate youth culture and even go some way to feeding the need for news, sport, and entertainment. Content consumption has grown in 2015 but there is overwhelming demand from consumers to have access to content wherever, whenever, and however they want. Addressing this demand will be key to broadcasters being positively viewed as relevant and informative and as a viable medium of escapism.
The broadcast landscape at the end of 2015 looks very different to how the year started. The launch of beIN Entertainment must be viewed as one of the year’s biggest milestones, alongside Fox switching its channels from FTA to Pay. MBC’s launch of its paid service, Shahid Plus, with content ring fenced by a paywall is another significant milestone; the fact that the region’s leading FTA broadcaster has established an SVOD service is testament to the changing dynamics of content cost, delivery, and consumption.
Zain’s relationship with Saudi-based UTURN Entertainment also highlights the perceived value associated with original programming, while the introduction of cash-on-delivery options by OTT player Starz Play is a clear example of the region’s local nuances forcing broadcasters to think outside the “global” box as they strive to monetise their content. I’m certain that the region’s broadcasters will now look to move away from the eye of the 2015 storm and into the evolving, rolling landscape that awaits in 2016.