The Arab world is home to more than 650 free-to-air TV stations – and has the potential to support many more, according to an industry expert.
There are already more than 650 stations in the region, according to the Arab Advisers Group.
Only a fraction of the region’s television stations are believed turn a profit from advertising revenues, leading some analysts to claim that the number of stations will decline.
But Simon Spanswick, chief executive of industry group the Association for International Broadcasting (AIB), said that the sector has plenty of room to grow.
“There’s going to be more expansion; I think there will inevitably be more channels,” he said.
Speaking on the sidelines of the recent Al Arabiya News Global Discussion in Dubai, Spanswick explained how the airwaves could get even more crowded in the future.
Q&A with Simon Spanswick, chief executive of the Association for International Broadcasting
Q. What does the future have in store for the Arab TV industry?
Expansion – constant expansion. It’s a bit like the cities around us. There are more channels starting all the time. There is huge competition now, because you’ve got a lot of state-run broadcasters. But they have certainly lost ground to the commercial sector.
Q. What other trends are there?
I think the state-run channels have really got to start picking up. There needs to be much more domestically produced content; there’s too much reliance on foreign stuff at the moment. So that industry needs to be built up. There is a huge opportunity here. There are storytellers out there, but I don’t know if they’ve been trained to work in broadcast television, and I think that’s something that needs to happen.
Q. There are already about 650 TV satellite channels in the Arab world. Is that sustainable?
There’s a huge question about advertising revenues and whether the advertising model as it stands can sustain itself. We’ve only just got in the UAE a proper [audience] measurement system that is not diary-based, but electronic. So there isn’t at the moment a currency [for TV audiences] as there is in Europe, where you can go and talk to an ad agency [with real audience figures]. If you look at the UK for example, on BBC1 you might get 10-12 million on a Saturday night, on ITV you get 9-10 million… and you look at Sky 1 with maybe 800,000. And anything below that falls off a cliff. But yet they’re attracting advertising. So the model obviously works to sustain 400 or 500 channels on the Sky platform in the UK. And here you’re talking about an Arabic-speaking region that stretches from Morocco all the way to the Gulf. So it’s quite a large potential audience.
Q. Do you see the pan-Arab model of TV broadcasting remaining, or will we see more local, country specific channels?
It could do. What people want when they watch television is something that is relevant to them. And a pan-Arabic service might not be relevant all the time. It might be of interest, but I think people want to know what’s going on in their own country and own region of that country. And that’s been missing from a lot of the state broadcasters, because news has not been their forte. People want local sports, local culture and local entertainment. So I think there is going to be mix. Because of the way this market has established itself, there will be a mix of both pan-regional broadcasting and much more local stuff.
Q. What forms of TV will dominate in the future?
[Television] could be delivered in a variety of ways. Connected TV is all very well, but I’m not sure how many people who have bought connected TVs are actually drilling down much beyond the front page if at all. Because it’s too much like hard work. A lot of people talk about the way that young people are using television, and saying that they don’t watch television any more, they’ll only watch it on their computers and time-shift. And you wonder how long that will continue as they grow up – whether they’ll always do that or whether, once they’ve got the pressures of a 9-to-5 job, they’ll just want to come home and be entertained, switch a channel on and slouch. And I think the jury is out on that. In the United States, I was talking to someone who is 28 years old and lives in New York. And we were talking about his [media] habits, and he said ‘I don’t have a television’. I said ‘why not?’. And he said ‘well, I’m not going to pay for a cable subscription because it’s expensive; I get everything I want on my laptop, so I’m never going to go out and buy a 42-inch television’. I asked about films. And he said ‘I’m quite happy with a laptop and headphones… I’m never going to go back to cable TV’.
Q. Do you see that trend happening in the Arab world?
I think if the content is available, and if things like Netflix or equivalents move in, then certainly blockbuster films, series and so on will be viewed on perhaps different platforms. I still think that, if you’re a sports fan, watching something on a big screen in high definition, and being able to have your friends around and have a nice afternoon watching a match [is] still a fairly compelling proposition – whether it’s Formula One, Wimbledon, football or whatever. So I think it’s going to be mix-and-match approach. People have got so many more choices now to do things. And that’s where the uncertainty lies, and that’s where the broadcaster has got to be very clever and make sure they’re following that curve.
Q. The Dubai-based pay-TV broadcaster OSN is considering an IPO. How would that change the landscape of the Middle East TV market?
It’s amazing that there is only one major [regional pay-TV] platform following the merger of Orbit and Showtime. And I don’t quite understand why there is only one. And I think it goes back to the fact that it’s perhaps the lack of single platforms, the lack of marketing and the lack of the right content. And I think if somebody came in – a Murdoch or another – there could be a big shakeup in the market. And with 300 million people it is a lucrative market: you’ve got a lot of money sloshing around this region, and people want to be entertained. I don’t know whether an IPO would have that effect, but I think people must be looking at the region and saying ‘there is an opportunity here’. But the problem is how you actually market a proposition right the way across this huge territory.
Q. What are the AIB’s activities and member base within the Middle East and North Africa?
What we do for all our members is provide market intelligence, what’s going on, who’s doing what and where are the opportunities. We get people talking to one another. From talking to senior people within an organization, we can spot things and say ‘you should talk to this person over here’. And bring people together. We’re constantly monitoring what’s going on in media, and it’s becoming much more complex than it ever was, because there are now so many ways of reaching audiences.