Middle East presents huge growth opportunities for Pay TV industry

…Satellite’s dominance, as a TV platform, rests unabated in the MENA region

For the vast majority of MENA countries, satellite continues to be the pre-eminent service for receiving television signals, both encrypted and free-to-air (FTA). In 2013 it exceeded a 90 percent primary TV set penetration rate among all TV households. In the Pay TV landscape, satellite is slightly less salient, due in part to the existence of IPTV. According to IHS data, at the end of 2013 satellite controlled 74.4 percent of the Pay TV market while IPTV’s share stood at 25.56 percent.

BeIN Sports Arabia and OSN are forming a virtual duopoly in MENA’s satellite Pay TV market

BeIN Sports Arabia (formerly known as Al Jazeera Sports) and OSN have managed to attract the vast bulk of satellite subscribers establishing a virtual duopoly in the market. Since 2009 (year of the merger between Showtime and Orbit to form OSN, and the year of Al Jazeera’s acquisition of all ART sports channels), the combined market share of BeIN Sports Arabia and OSN fluctuated between 85 percent and 82 percent. The recent acquisition of the English Premier League rights by BeIN Sports Arabia as well as the acquisition of South-Asian Pay TV operator Pehla by OSN will further reinforce this trend, according to IHS.

A large HD channel offer is not complemented by a clear and concrete monetization strategy

The HD channels offer in the MENA region experienced an explosive growth from just two HD channels in 2009 to 158 in the first two months of 2014. However, 71 HD channels, or around 45 percent of the total offer, are being provided for free. The free HD offer in MENA is higher than the total HD offer in countries like Italy, Spain, Russia, Australia and South Africa. Pay TV operators do not have a policy of up-selling their HD content. My-HD Media, a Dubai-based channel aggregator, is testing the waters launching in mid-2013 a low-cost offer of HD channels tied with the purchase of a specific set-top box with no further subscription charges for the first 12 months.

Report Methodology:

All forecasts in IHS Technology – MENA Media & Telecoms Intelligence Service are done in-house based on historical and current data gathered first-hand directly from the companies concerned, and from trade bodies, regulatory authorities or government departments with which IHS Technology maintains a relationship. IHS does not rely on third-party sources for its reports. This approach provides a sound basis on which to develop IHS models, all of which are built company-by-company and technology-by-technology. Totals are then derived from the component parts and are thus wholly granular.

Countries included in the study are: Algeria, Bahrain, Egypt, Jordan, Kuwait, Lebanon, Libya, Morocco, Oman, Qatar, Saudi Arabia, Tunisia and the UAE.

IHS Forum Dubai to highlight key Middle East growth markets

The first ever IHS Forum in Dubai will bring together industry leaders and the top IHS experts to examine key growth markets and innovation sectors within the Middle East.

The IHS Forum, Dubai 2014 will be held at the Intercontinental Dubai Festival City, from 27-29 April.