Report Forecasts Growth in Middle East, African Multichannel Homes

LONDON, July 11: Multichannel TV penetration in the Middle
East and North Africa is expected to reach 72 percent by 2013, according to a
new report by Informa Telecoms & Media, up from 61 percent this year.

That growth, which adds a further 14 million multichannel
homes in the region for a total of 48.4 million, will drive the projected
73-percent increase in TV advertising revenues in these markets from $1.9
billion in 2007 to $3.3 billion in 2013.

A driver in terms of the ad market is expected to be Turkey,
with projected TV adspend of $2.1 billion in 2013, up from $1.2 billion in
2007. Pan-regional ad revenues will grow from $380.2 million to $655.5 million.
In Israel, net TV ad revenues will rise from $133 million to $194.8 million.

There are expected to be 1.8 million multichannel TV homes
In Israel by 2013, with a 79.1 percent penetration. In Turkey, multichannel TV
penetration is expected to soar from 44.9 percent to 69.6 percent, with 13.9
million homes. The Levant area of the Middle East—encompassing markets
like Jordan and Syria—will be home to 4.7 million multichannel homes, for
a 69.6-percent penetration. In the Gulf States, penetration is expected to rise
to 88.9 percent with 6.5 million homes. And in North Africa, the number of
multichannel homes will rise from 16.4 million to 21.5 million.

The research, contained in the 5th edition of the
Middle East & Africa TV report, also indicates that the pay-TV market in this
region will increase by 38 percent over the next six years. There are forecast
to be 7 million pay-TV subscribers in these markets in 2013, led by Israel and
Turkey, which will account for 4.3 million pay-TV homes between them at end-2013.

Adam
Thomas, Informa’s media research manager 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
expectations for this region are bullish, Informa notes that there are several
factors inhibiting even greater gains, including huge income disparities within
these markets. As such, pay-TV operators are limited to small, wealthy segments
of the population and expat communities. “Some of the major TV operators are
loss-making and seem to be some way off financial self-sufficiency,” Thomas
explains. “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.”

—By Mansha Daswani