Channeling Arabia

This article originally appeared in the MIPTV 2012 issue of TV Middle East and Africa.

Politically, the Middle East remains in turmoil, and on the ground there are some very real challenges to be solved. But overhead, the 600 or so satellite channels continue to make progress. The past year has also seen high-definition television catch viewers’ imaginations, and major infrastructure projects, like Abu Dhabi’s twofour54, starting to make a real impact on the market.

 

Indeed, twofour54 is already providing a comfortable home to international media groups such as Turner Broadcasting (with CNN’s latest pan-regional bureau as well as the Cartoon Network Animation Academy), Viacom (Comedy Central Studios Arabia), News Corporation’s BSkyB/Sky News Arabia, the games house UbiSoft, and local initiatives such as Tropfest, a short-film competition.

 

The progress also extends to the pay-TV sector. The much-maligned Orbit and Showtime platforms are now finding that as a merged entity, OSN Network, they are helping solve signal piracy as well as pushing the pay-TV envelope with high-definition channels, and tapping into advanced technology such as VOD services, in a deliberate attempt to differentiate themselves from the free-to-air players.

 

Viacom is a perfect case in point. Its Indian joint venture with Network18, Viacom18, is extremely busy in the Middle East, pushing its top-rated Colors network into the Gulf as well as providing feeds such as MTV India’s energetic Bollywood content alongside the established MTV International and MTV Middle East signals.

 

Gaurav Gandhi, Viacom18’s head of distribution and international business, says that in the five years since the joint venture was formed it has enjoyed remarkable success, first in India and now in the Middle East. “The JV now has six broadcast brands, a couple of HD brands, the movie arm, and other projects under way. These include expansion into other nearby regions, including the Gulf,” he says. “There is a huge [South Asian population] outside of India and this is our initial target audience. Around the world this equals about 25 million to 30 million people, but the big pockets are the U.K., the U.S. and the Middle East. It’s natural that any Indian broadcaster would want to try and reach this huge audience. We get a double advantage. By and large, and unlike many U.S. and European networks, we hold onto our IP rights to the shows. Therefore [the process to] get international channels up and running is much simplified.”

 

Gandhi explains that Colors’ international efforts started in early 2010 in the U.S. and the U.K., expanding to the Middle East later that year. “Initially we started out on the Pehla pay platform run by ADD”—Arab Digital Distribution, a portion of the old ART bouquet. “Then our focus was to get the channel on air and establish ourselves as a serious contender for viewers. For the first year the Pehla team was selling our advertising. Now we have our own office, focusing on expanding Colors in the region and into Africa, and Africa is now a big market for us given that we are available in many local markets, not least Kenya. [Our second priority] was to set up our own advertising operation. Third, we needed an office to look after our various marketing initiatives.”

 

Gandhi admits that piracy has been a problem, although progress is now being seen. At the moment, however, free to air is not on his agenda. “The problem with the free-to-air market, at least for us, is the absence of audience measurement. It means we are very limited as to how we can monetize a free network. For us, a combination of pay-TV [affiliate revenues] plus advertising income works very well.

 

With people meters in place it could be a very different argument. Out of the UAE’s total population of about 8.3 million, almost half are South Asian, made up of expat Indians, Pakistanis and Bangladeshis. That’s a good audience, but the advertising cake is minuscule, even for Arabic channels. Once measurement is in place then we will look at free services.”

 

Viacom18 is, however, firmly behind localization. “When you look at the Middle East—and India for that matter—the best-performing shows have been localized,” says Gandhi. “We launched Comedy Central India on January 23, and at Abu Dhabi there’s excellent work going on for their Arabic localizations.”

 

Comedy Central Studios Arabia is a joint venture of Viacom International Media Networks and twofour54, led by Sharif Maghraby as managing director, that aims to seek out new comedic talent and bring concepts to the screen. “It is not a channel yet,” admits Wayne Borg, twofour54’s deputy CEO and COO. “However, it is clear that when you have such a strong portfolio of shows in development then it is only a matter of time before one of them gets to air. The team is extremely hopeful about a new weekly comedy sketch show, already with a pilot in development and considerable interest from local broadcasting majors.”

 

FOX International Channels, meanwhile, has taken a different approach to localization. “Like a lot of foreign players, we used to have a traditional strategy of, let’s take one of our existing feeds and throw some Arabic subtitles on it and beam it in from Europe or Asia and sell it to the pay-TV operator,” says Ward Platt, the president for the Middle East and the Asia Pacific at FIC. “We changed that approach about four years ago. We started to launch free-to-air satellite channels and we invested further in our pay-TV channels. We have a Fox Movies free-to-air Hollywood movie channel, we have a FOX free-to-air international TV series channel, all dubbed in Arabic. We have FX, another free-to-air channel with edgy TV series, all subtitled in Arabic. We have Nat Geo Abu Dhabi, in partnership with Abu Dhabi Media, 100-­percent dubbed in Arabic, and we’ve launched Nat Geo Farsi. At the same time, we’ve been able to grow our pay-TV business. We focus much more on the HD strategy there.”

 

Another company that operates a suite of services in the region is BBC Worldwide Channels, which distributes BBC Entertainment and BBC Lifestyle exclusively on OSN, and the more widely available BBC World News.

 

“The BBC has a long-established reputation for innovation, quality storytelling and high production values,” says Ian McDon­ough, the senior VP and channel manager for EMEA at BBC Worldwide Channels, who also oversees a five-channel bouquet in Africa. “By segmenting a portfolio along genre strands, we have provided a one-stop shop for the entire family.”

 

A core area of focus for BBC Worldwide Channels has been investing in distinctive programming for the portfolio. “A key part of our strategy is to provide our viewers with events that unite audiences worldwide,” McDonough says. “The broadcast of the royal wedding last year across our global networks was a huge success and we plan to air several more events of this nature during 2012.”

 

Turner Broadcasting, too, has a number of channels present in the Middle East: Cartoon Network, Boomerang and Turner Classic Movies, all in English, are on pay TV with OSN, while CNN is free to view. Alan Musa, Turner’s VP and general manager for the Middle East and Africa, adds, “Within the free-to-air space we have Cartoon Network Arabia, which has all been either dubbed into Arabic or produced in Arabic.”

In many respects it is Turner’s activity within Cartoon Network Arabia that is the most interesting. With twofour54 it has formed an animation academy, and its first batch of students not only graduated (toward the end of last year), but are working on new concepts that are being examined by the network. Fifteen new students started their studies in January.

 

“Our project at twofour54 is essential to the long-term ambition for our business in the Middle East,” Musa explains. “The Cartoon Network Animation Academy enables us to identify and incubate the creative talent that exists in the Middle East; our Cartoon Network Studios Arabia then allows us to nurture this talent through development, mentoring, and hands-on experience in developing concepts from ideas to story board, pilot and, hopefully, full series. The final part of this particular journey is the ambition to create full series that will feature prominently on Cartoon Network Arabic, and possibly internationally. The consumer and commercial success of these local productions will then enable investment back into the talent pool that exists in the region and continue the cycle of creating content.”

 

Musa says that the start of the process has delivered up two pilots. “Both are underpinned by the creative talent that we have identified in the Middle East—how exciting is that!” 

 

Borg from twofour54 adds, “There’s a change taking place here, where Abu Dhabi is being recognized as an ideas capital, and we want to increase that role. We want to encourage talent, of course, and get young people excited about media and in doing so overcome certain local taboos about working in TV and its related services.”

 

Borg explains that, as is true everywhere else on the planet, every Middle Eastern youngster wants to be a soccer, movie or pop star, and sometimes all three! But there is very little exposure to the real needs of the broadcasting or production community. Over the next five to seven years estimates are that about 9,000 media-related positions will need to be filled locally. And as part of that mix they anticipate that an abundance of new talent will emerge.

Borg says that of the 2011 CN Animation Academy trainees, three went on to join Cartoon Network. The graduates are helping develop their own projects, and working closely with those who are now submitting ideas into the Cartoon Network ideas pool.

 

Turner’s Musa says he envisions more of these strategic relationships emerging. “I see long-term partnerships being established within the region that will encourage the growth of local productions—whether it’s in the news genre, general entertainment or kids’ space. I imagine the topic of research, and a more industry-wide, region-wide metric being an option for the future that will give all parties within the media business the clarity and currency that is needed.”

 

Dean Possenniskie, the managing director for Europe at A+E Networks, who also oversees the company’s business in the Middle East, shares that sentiment. “Almost all of our content is localized, usually with subtitles, and OSN looks after that for us. Sometimes they include a Farsi option for that audience, which we see as being critical to reaching the market and building a broader subscriber base. From our point of view, we are focused on bringing the best of our international content to the Middle East. So we are not commissioning local programming, but at the very least subtitling is very important. 

 

With the networks that we currently run, we remain loyal to pay TV.”

For Food Network on OSN Network, meanwhile, localization efforts have included on-the-ground events. “We attended the Taste of Dubai food festival [in Dubai in March] and had one of our newest chefs, Aarti Sequeira, participating in cooking demonstrations for us,” says Nick Thorogood, Food Network’s managing director for EMEA, who notes that the Middle East is “a key focus for growth” for the channel.

 

A+E’s Possenniskie is bullish on the pay-TV model because of its subscriber revenues. He remains cautious about free TV because of the absence of accurate audience measurement in the market. Nevertheless, he admits that A+E remains open to developing new concepts for local free-to-air channels. However, he says, “the greatest barrier to those [concepts] is the investment, and it would be a significant investment. There’s a huge problem with measuring viewers. When I first got involved in the Middle East, the worry then was the lack of audience measurement and here we are, six or seven years later, still complaining about the same issue. It is really a major concern that has yet to be cracked. It’s good that we now have more proactive interest in this from people like Abu Dhabi Media and we wholly support any initiative that can start measuring this audience. Until that happens, we will stay with pay TV.”

 

Dubai has its busy Media City, and it is fair to say that despite the political problems in Egypt, Syria and Lebanon, the local production houses have never been busier. And new entrants like twofour54 are nurturing the talent of tomorrow. Borg says that during three of the worst financial years on record, the Abu Dhabi initiative has grown beyond expectations to permanently host some of the biggest world media names in the industry. The fact that the likes of Turner, Viacom, Disney, News Corp., Discovery and other key players are investing in the region shows that, as elsewhere on the planet, they are thinking globally, but quite definitely acting locally.