Worldwide investments are expected to double to $300 trillion in a few years, with 60% of that growth coming from new global markets, according to the World Economic Forum. For the past five years, Asia has been the world’s fastest growing region, a trend expected to continue for the next 25 years. China and India are commonly identified as that region’s fastest growing markets, yet since both countries depend highly on exports to the United States, they may suffer margin erosion if the dollar continues to depreciate. Meanwhile, the rising Euro is stripping Europe of its appeal, as rising costs of imports make Western European countries relatively less competitive. Several Western European countries have been confronted by housing bubbles larger than that of the United States, in relative terms, and may thus suffer accordingly.

Despite the efforts of many governments and central banks, this decline in the global economy seems to continue. Faced with slower economic growth, many experts believe that building a solid and immune organization today depends on expanding into new emerging markets. Former U.S. Federal Trade chairman Alan Greenspan believes that globalization of trade will help the U.S. deal with the recession. “Growing globalization of trade and the economy would facilitate the absorption of shocks in the U.S.,” he said at an investment conference in Jeddah. The broadcasting sector may be detached from the general economy, to a certain extent, as shown in a recent IABM survey, which observed that sales have risen 11.9%. However, we cannot ignore that there are signs indicating that the broadcast manufacturing market is softening.

The good news is that the depreciating dollar, coupled with continuous growth in emerging markets, will likely push exports to a record high in dollar terms. Venturing into emerging markets can help broadcasting companies compete and even thrive during difficult economic times. American firms investing abroad will benefit from the weak dollar in various ways:

1- When a U.S. firm establishes a local base overseas, its assets and revenue will be worth more in dollars.

2- When firms export their products from the U.S., their income will rise relative to their costs, assuming that their costs are mainly local.

3- The low rate of the dollar decreases the price of exports in foreign-currency terms, which makes U.S. wares more competitive

The former CEO of the International Association of Broadcasting Manufacturers, Mr. Roger Crumpton, agrees: “Because of the low rate of the dollar, customers in places like Dubai now want to do business in that currency rather than Euros or Sterling. That will keep American companies competitive and may bring about a pull-through and strengthen the dollar.” A key finding of the PricewaterhouseCoopers (PwC) 2008 CEO Survey reveals that key emerging market players are distinctly more confident about their short- and long-term growth prospects than their developed economy counterparts. According to PwC: “The global television distribution market will increase from US $160.6 billion in 2006 to US $250.7 billion in 2011, a compound annual growth rate of 9.3 percent during the five-year forecast period. EMEA will average double-digit annual increases of 12.3 percent, while mid-single-digit growth is projected for the United States (5.4 percent).” Despite the credit crisis, the depreciating U.S. dollar, and an economy teetering on recession, the Middle East broadcasting industry continues to grow. Against all odds, economic and development indicators point to the Middle East, particularly to the hyper growth of the Gulf countries, as a key growth region and investment opportunity.

The Middle East currently enjoys a high pool of liquidity, and is actively engaging in cross-border investments. For example, the UAE, the Middle East’s media hub, reports that 18 private stock companies and about 300 foreign corporations were established in the Emirates in 2007 alone. These companies have a combined capital value of almost 2 billion dollars, bringing the total number of ministry-registered stock companies to 99, with a combined capital of well over 7 billion dollars. Khalid Belkhyour, CEO of Arabsat, ranked the 9th largest satellite provider in the world, seems to agree: “The MENA market is certainly one of the most dynamic markets for Ku-band with commercial leases,” In our interview, Belkhyour eagerly continued to outline the growth prospects for the market: “Revenues are projected to grow over the next five years at annual rates unmatched in any other regions of self grew by close to 10% per year. In the BSS alone, the number of free-to-air TV channels has skyrocketed from only slightly more than a 100 to more than 500 today, with recent projections from Arab Advisors to quickly pass the 1,000 threshold within the coming years. A similar phenomenon is observed and anticipated in the FSS for telecoms services as deregulation rapidly spans throughout the MENA region, leap-frogging technologies such as 3.5G, DTT, DVB-H, and xDSL, and enabling triple-play services, that are being aggressively deployed through massive investments from both the private sector as well as the government-ruled bodies.”

At the time of our interview, Roger Crumpton was still the CEO of IABM when he pointed out that “the size and diversity of the Middle East market offers significant opportunities for suppliers”. Likewise, the president of the Arab Advisors Group, Jawad Abbassi, says that market growth translates into many opportunities for vendors. “The ones who will win,” notes Abbassi, “will be the ones who take a strategic look at the region and emphasize technology transfer and strong local support teams.” As a result, innovation is needed to manage this paradox of long-term strategizing while staying focused on the immediate future. This could be easier said than done, as recent studies show that few are able to master both skills. Most companies venturing into new markets lack the appropriate skills to match their distinctive capabilities with sectors where profitable growth is most likely to occur.

This is why MEB and NAB strengthened their collaboration this year. Both associations are teaming to level the ground for your company to easily navigate the Middle East broadcasting market. This report has been prepared by the Middle East Broadcasters Association (MEB) in partnership with the National Association of Broadcasters (NAB), to highlight and breakdown key opportunities in the Middle East broadcasting market. It evaluates the role of newcomers and main players alike, providing a summarized analysis of the short-term growth of the market in the following sectors:

A. Television Stations and Production Companies

B. Satellite Providers

C. Broadcasting Suppliers

D. New Technologies Implementation

E. Educational and Training Institutions

A. Television Stations and Production Companies
The surge in television stations in the Middle East has been staggering. The total number of TV channels has surpassed 400, with around 300 radio stations. This is considered a major turn and a good indicator of its future – especially given how far it has come in a short period of time. According to the Arab Advisors Group, the number of free-to-air (FTA) channels in the Arab world grew a massive 270% between January 2004 and August 2007, totaling 370 channels as of August 2007. Arab Advisors Group reports that 71% of total FTA satellite channels are privately owned. The reasons behind the present growth date back to the 1970s, when television networks in the Arab world were limited by three major problems: insufficient local program production, close government scrutiny and control, and shortages of human and financial resources. The growth in the number of stations seems to be guided by the demands and preferences of the dominant viewership – young adults – who represent more than half of the Arab population. Their preferences are geared toward Western content, and they have urged the demand for higher quality, wider variety, and more progressive TV content. This fast growth of private TV stations created healthy competition and forced stations to reevaluate their position and upgrade their facilities, including government-owned stations. Continuous investment in building and upgrading facilities and equipment is both a result and catalyst of the industry’s growth. Indian-owned Taj TV has been in Dubai Media City (DMC) since early 2002. CEO Chris McDonald says of production in Dubai: “The business is growing in leaps and bounds. Channels in Abu Dhabi and even Sharjah are coming up every day, and they are looking for someone to help them get their product on air.” While the bulk of Taj TV’s revenues come from its Ten Sports channels, MacDonald estimates that 15 to 20 percent comes from its Dubai production services. Given the growing market, Taj TV’s main limitation is the size of its DMC offices, McDonald says. “Now we have to find the space to build another studio.” Middle East Broadcasting Center (MBC) the region’s leading, Saudi-based television network, invested about $50 million. Chief Technical Officer Radwan Kanaan notes: “This is a huge investment. We were initially based in the UK, then we moved to Dubai six years ago.” MBC had to build new facilities for its headquarters in Dubai, where most of the region’s channels have headquarters or offices. “I believe that the growth will continue because most broadcast companies expand their channels,” Kanaan told MEB. “For example, MBC started with one channel; now we are up to six channels and are planning to launch two more.” Private Lebanese broadcaster LBC has spent between six and seven million dollars on upgrades in the past few years, according to Chief Technical Officer Mr. Nassim Boustani. While MBC and LBC are general entertainment networks, analysts are predicting the rise of specialized, or niche channels. Dubai-based Booz Allen Hamilton VP Karim Sabbagh predicts an increase in the number of niche channels due to an oversupply of general interest programming. There are no indicators, as yet, that the growth of general entertainment channels is slowing, but as niche channels meet the specific demands of viewers, other channels are likely to fade out of the picture. Niche free-toair channels are likely to pose a bigger challenge to the region’s pay TV market, which is limited to three pay TV providers: Orbit, ART, and Showtime.

“Pay TV faces a lot of challenges in the MENA region from FTA channels,” Arab Advisors Group’s Abbassi recp cently told MEB, “as their penetration is much lower.” Abbassi notes that ART and Showtime have strong sports programming, which should drive interest, but at a much higher cost for them. According to a recent study by the Association of Public Television Stations (APTS), this trend parallels the U.S. market, where almost half of U.S. househp holds reject moving from FTA to cable or DTH pay TV. The APTS president says “this data indicates that free, over-theair television may be set for a big comeback.” The Middle East market is closely reflecting this, indicating that the booming region is unique in its opportunity for growth, but follows, for the most part, global trends in demand.

Production Companies
The Middle East is also attracting new production companies to the area, particularly after Dubai Media City was virtually filled with offices for different TV stations. As a result, Dubai started its Studio City project, an ultramodern facility integrating every component of productp tion and broadcast in an area that will spread across 22 million square feet. Dubai Studio City recently announced that Phase 1 construction of its AED320 million Commercial Complex will be completed by December 2008. The 490,000 square foot Commercial Complex will provide a range of office spaces suitable for production houses, small and medium business set-ups, freelancers, animation and graphic design companies.

Tenants from the film, TV, radio production and broadcast industries can rent office spaces starting from 800 square feet. The Commercial Complex also offers the provision of leasing entire buildings to match high space demands. This model, coupled with market growth, is attracting large and small companies alike, from major entertainment firms and production houses, and even networks.

Warner Bros. Entertainment has partnered with two Abu Dhabi companies in a multibillion-dollar project to develop a film and videogame production firm, in addition to a theme park, a hotel, and multiple cinemas in the Emirates. A Time Warner press release called the project an “unprecedented, long-term, multi-faceted strategic alliance.”

Hollywood’s MGM entered the market after it signed an agreement to co-produce the series Pink Panther and Friends with Amman-based Rubicon. Now MGM’s sole agent for licensing and merchandising around the region, and one of the region’s only animation studios, Rubicon will do half the production work and be responsible for regional merchandising and licensing agreements. Rubicon’s most recent experience designing animated children’s programming came with Ben & Izzy, which follows the tolerance-building adventures of two boys, a Jordanian and an American. MGM has agreed to help distribute Ben & Izzy internationally. Rubicon will also explore “location-based entertainment” opportunities – theme parks or mixed-use real estate projects – for MGM across the region.

Jamal Al Sharif, the director of Dubai Studio City, said: “We are delighted that Dubai Studio City’s premium infrastructure is attracting major global heavyweights. We are constantly working towards enhancing our scope of offerings to provide a strategic platform that will help partners extend their footprint in the Middle East region.

B. Satellite Providers
The MENA region registered the highest revenue growth in the global commercial satellite industry in 2005, according to market research. Regional satellite providers meet high demand with innovative, quality, and cost-efficient solutions to customers across the Arab world. Arabsat, the region’s leading satellite operator, reaches millions of homes in over 80 countries across the Middle East, Africa, Europe, and beyond.

Arabsat has invested approximately $1 billion during the past ten years. Furthermore, its capacity will double, since it will launch a new satellite per year from now until 2011. Eventually this will make its fleet the youngest in the region. “I have no doubts that this aggressive fleet expansion plan will put us in the best possible position to capture the largest part of the market growth,” says CEO Balkheyour, “coming from HDTV and rapidly emerging markets such as sub-Saharan Africa, as well as Eastern and Central Asia.”

Middle East companies are also investing in innovative new satellite technologies, which means substantial savings for satellite stations across the Arab region. Last year, Arabsat was the first to collaborate with Kosmas GEOring Services, a company developing an innovative technology named HERMES which could double the lifespan of a dying satellite. Onboard fuel capacity currently restricts the maximum lifespan of a satellite to 18 years; Arabsat’s Project Director Mr. Ahmad Al Shraideh told MEB: “we are currently conducting studies and research with GEOring in order to prolong the expected lifetime of our existing 3A and 2B satellites.” Eutelsat recently followed Arabsat’s lead on that when they collaborated with the UK’s Orbital Satellite Services, Ltd.

Nilesat, the Middle East’s second satellite provider, is now broadcasting more than 400 digital TV channels in the Ku band, 98 digital radio channels, and provides data transmission and turbo internet services. Nearly 60 percent of its TV channels are free-to-air; the rest are encrypted. With a licensed capital of $500 million and an issued $170 million, the Cairo-based broadcaster plans to launch a new satellite, Nilesat 201, a 28-transponder satellite (24 in the Ku-band and 4 in the Ka-band) in 2010. Nilesat CEO Salah Hamza says Nilesat is currently broadcasting 415 channels throughout the Middle East. Nilesat expects the total channel count to grow from today’s near 900 channels to near 1200 by 2015. “Logic tells you that one day the market will reach saturation but we still have high definition to look forward to and I don’t think we are close to saturation,” says Mr. Hamza. Abu Dhabi is a recent market entrant, having invested $1.66 billion to develop and operate two hybrid telecommunications satellites through its Mubadala Development Company. The satellites that will offer telecom, internet, corporate data, and broadcasting services to the Middle East, Africa, Europe, and South-East Asia by 2010. The system is designed to accommodate the trends of emerging applications in the satellite industry, such as HDTV and other broadband satellite services. Yahsat’s chairman and COO of Mubadala, Waleed Al Mokarrab Al Muhairi, says “this is a tremendously exciting time to be in the satellite communications industry.”

Indeed, Arabsat’s Belkhyour notes: “As MENA is currently the most dynamic market for satellite-based services, particularly in the broadcast area, a number of regional and global competitors are indeed targeting it.” An unexpected Israeli satellite operator almost entered the race, but SES Global, the world’s second largest communications satellite operator, bid to acquire Israel’s Space-Communication, Ltd. (Spacecom) and was turned down. Belkhyour remains confident in Arabsat’s position as leading satellite provider in the region: “Arabsat’s strategy is to keep growing its leading market share in its two core business segments, broadcast and telecoms…We’re rapidly building by far the largest and fastest-growing Arab community in the sky.”

Yves Feltes, PR manager at SES, told MEB “The region clearly has high demand in broadcast and enterprise; even governments are establishing a presence. SES was interested in Amos for its significant slots not only in the Middle East, but also in Eastern Europe.” This is not the company’s first move into the region. In October of last year, ND Satcom, a SES company, acquired a stake in Glocom, a Dubai-based system integrator and equipment supplier for turnkey digital broadcasting solutions. ND Satcom has strongly increased its revenues outside Europe, of which roughly 15% are generated in the MENA region.

C. Broadcasting Suppliers
The Middle East has always generated lucrative orders for Western manufacturers. Sales are usually conducted through a local distributor, but with the current rate of growth, customers are demanding quick and effective support directly from the suppliers. According to the PwC study, communications CEOs identify their main future source of competitive advantage as “improved customer service.” Their response (30% against a global average of 19%) reflects that sector’s awareness of the need to improve customer retention and reduce “churn” by getting to grips with its historically poor reputation for customer support. BAH/Lebanon VP Mr. Chahine told MEB: “Distributors have a role in the region, given the heavy weight that personal relations have on business conduct in this part of the world. Additionally, the geographic spread of the region and having several markets where TV stations are based, makes having a nimble local distributor who is capable of covering the region with low overhead cost a more efficient solution than having to set up offices for the principal companies in the region.” However, some successful Western companies seem to rewrite how business is conducted in the Middle East. If you are planning to venture to the Middle East market, it is probably a good idea to focus the reasons behind their success.

Harris Corporation is a prime example of a broadcast equipment and systems supplier that was able to understand and meet market needs. Two years ago, it established a local base with an Arabic-speaking engineering team to support customers’ demands in the region. This is the key to Harris’ domination of the region’s broadcasting landscape, having been awarded a number of lucrative orders from different television stations and media firms such as Gulf Media Company, LBCI, NBN, Kuwait TV and many of Saudi Arabia’s television facilities, which are all gradually converting to high definition. Said Bacho elaborated on what he feels the secrets for the company’s success in the region: “Broadcasting is the main reason of growth in the Middle East. We were extremely successful because the team fully understands the culture and the market. We recently launched a new distribution center to receive spare parts out of Dubai rather than Europe” Bacho, Managing Director of Harris Broadcast Communications Middle East adds: “We have more than doubled our revenue during the past two years. In comparison with our competitors, we have one of the fastest, if not the fastest, operations in broadcasting. I think growth will continue over the next 3 years, specifically with the HD.”

Harris Corporation reported a broadcasting revenue growth of six percent in the past quarter as compared to the previous year, to $164 million. Chairman, President, and CEO Howard Lance says he expects every segment to have higher revenue and a better operating income in 2008, particularly in the company’s RF communications tactical radio broadcast revenue. Sony, a major broadcast supplier in the region, is another success story from which newcomers need to learn. “The MENA broadcasting market is booming and constantly evolving. For those companies to succeed, they should consider following Sony’s strategy in EU that consists of providing financial services and apply it in the MENA region,” says BCS CEO Elie Yahchouchi.

Sony recently conducted a deal with Showtime Arabia to equip it with a state-of-the-art transmission, (the TX system is both HD and standard definition capable) facility, and design, and is implementing a four-camera complete HD-capable sports production studio specifically to enable Showtime Arabia to cover the English Premier League in both Arabic and English. Mr. Yahchouchi believes that the growth of the broadcasting market in the MENA region over the last three years was 10 to 15% per year. He says: “Our revenues have increased 15% yearly to reach $9 million in 2007. We are projecting a 50% increase within the next five years.”

BCS, a major supplier and system integrator in the region, highlights that the Gulf and Levant are showing the highest demand for broadcasting products. As for Lebanon, BCS says the following products are demanded the most: Sony cameras, videotape recorders, and monitors are highly popular. Sony’s market share for these products is probably higher than 80%.

Elie lists other companies that are doing well in the area, such as: Fujinon, Vinten, Omneon, and Seachange, Evertz, and Miranda multiviewers. Mr. Yahchouchi believes that dependence on resellers to distribute products is a successful trend: “It is simply because distributors know the market much better than the suppliers. They know the language, which makes it easier to communicate, and understand the customers’ needs. They can provide local support, which tremendously minimizes downtime and can provide credit facilities to their customers. Today, direct sales from the suppliers to the customers consists of 20%, while the remaining 80% are done through the local distributor.”

“We already have a presence in the Gulf and are planning a presence in Africa to be able to cover all the Middle East and Africa region,” affirms Mr. Yahchouchi. “We feel that, due to the economic growth as well as to the open space for all broadcasters and the opening of media cities in the region such as Dubai and Abu Dhabi, new investments should double within the next 10 years.”

While international markets account for around 75% of the total sales for Swiss cabling specialist Reichle & De- Massari, the company reported that its greatest sales increase was recorded in the Middle East for the fourth time in a row. Sales in this sector doubled, driven by the building boom in the Gulf States and new business in India. “The international presence we have achieved through our market organizations, the commitment of our competent, autonomous teams, and the close cooperation with qualified partners onsite have been warmly received by our various markets,” reports CEO Martin Reichle. Customer proximity and family-oriented customer relations have always been two of R&M’s traditional strengths. The phenomenal growth of R&M sales in the Middle East region is because of the company’s international presence, customer proximity, service, and delivery reliability.

After signing its largest consultancy agreement with Qatar to support a $2.6 billion regional energy hub, Cisco is planning to expand further in the Gulf area. According to John Chambers, Cisco’s Chairman and CEO, Cisco plans to invest up to $1.59 billion on information and communications technology (ICT) in the United Arab Emirates over the next five years. To accommodate the investment, Cisco is to set up regional headquarters in Dubai in April. “Cisco’s worldwide growth has been phenomenal and the Gulf region has been amongst the top three fastest growing regions for us, globally,” said Sam Alkharat, Cisco’s General Manager, Gulf. Emerging markets such as the Middle East, Russia, and Eastern Europe have led Cisco’s sales gains over the past two years, with revenue rising an average of 38 percent, according to analyst data. The company also intends to open an office in Abu Dhabi in June to serve the customer base in the capital.

D. New Technologies Implementation
According to PricewaterhouseCoopers, technology CEOs are the most confident of growth, with 60% saying they are very confident of achieving revenue growth over the next 12 months, compared to a global average of 50% across all industries. This finding reflects the unrelenting demand for new technologies, especially in emerging markets.

Decades of state-run broadcasting have left the region with a stunted television advertising market. “The MENA region is indeed growing at a fast pace albeit from a low base,” says Gabriel Chahine, the Beirut-based Vice President of Booz Allen Hamilton. “We have to recognize that the entire regional net advertising spending is less than two billion U.S. dollars, despite the past three years 30 percent plus compounded growth. It should be noted that ad market growth is mirroring the significant economic growth that the MENA region is enjoying, fueled by higher oil prices and economic liberalization and openness programs adopted by all countries. I believe the region will continue to enjoy an average 15 percent growth for the coming 3 to 5 years given the expected economic growth.”

Today’s private stations cannot depend on traditional advertising as their sole source of revenue. Instead, many are looking into new technologies to secure new sources of profit. Many channels in the Middle East offer a constant stream of SMS2TV, MMS2TV, interactive services, and mobile downloads, deriving revenues from each. Their willingness to utilize non-traditional revenue streams means that services are expected to grow in the near future, especially as IP connections become more available throughout the region. In the wake of this, Belkhyour singles out two services that should enjoy the most rapid expansion: HDTV and video distribution.

Advertising rates are expected to rise in the Middle East as reliable ratings systems are being established. A people meter is set to be in place by the end of the year, and media analysts expect its accurate findings to raise television ad prices while deflating primetime ad costs. The four-year project will cost between $5 and $5.5 million, split 40-40 between TV stations and advertisers, with ad agencies paying the remaining 20 percent. Five broadcasters on the project’s board include: MBC, LBC, Rotana, Saudi TV, and Dubai Media Incorporated. The board also includes the Media Agency Council, representing media agencies, and the Advertisement Business Group, representing advertisers. Since 2003, the broadband environment in the Middle East and North Africa region has experienced rapid changes. Market liberalization, increased competition, and the introduction of new network technologies are all increasing consumer demand for broadband access. In 2006, most MENA countries experienced double and even triple-digit growth in the number of broadband subscribers. As a result, there are significant opportunities for telecommunications operators to tap into this potential and increase their revenues and bottom line margins. At the same time, however, operators face difficult marketing, technical, and operational decisions.

In addition to the factors above, greater availability of and demand for the burgeoning youth market for digital content and the increase in prosperity in the region are also significant drivers behind the observed boost in demand for broadband. This demand seems set for continued growth as more countries in the region move toward a competitive structure and as advancements in technology make it more possible to provide high-speed broadband in an economic manner. However, the success of regional telecommunications operators in capturing this demand will depend on key marketing, technology, and customer service strategies and decisions that they will need to adopt. The broadband environment is changing, and operators will face challenges in finding the right answers to complex service differentiation questions in selecting the most favorable network technology options and in building the optimal customer service model.

“I do not believe the region will behave differently from other markets in the world.” Booz Allen Hamilton Vice President Chahine told the MEB Journal. “The higher per capita income across all markets is allowing for faster and deeper penetration of new technologies. I tend to believe that the growth path of new distribution channels of content will mirror that of developed markets such as Greece and possibly Portugal and Italy. It will fall a bit behind the UK and Scandinavian countries, but at parity with south European markets in terms of penetration and frequency of usage. Naturally, GCC, and to a lesser extent, Lebanon will continue to lead in terms of new media or new distribution channels ahead of Egypt and North Africa. New technology will lead to additional fragmentation of audience and, consequently, a change in the advertising allocation strategies of clients. This will hit the bottom line of TV channels, especially those who do not learn quickly how to leverage the new distribution channels to generate additional revenues.”

Mobile TV
High GDP per capita in some Arab countries, combined with the fact that entertainment options in the Arab world are limited, poise it to be a leading mobile content market. Mobile TV is up and running in at least eight countries across the MENA region. Saudi Arabian mobile users demonstrate 49 percent interest in watching TV on their phones, compared to a mere 8 percent in the U.S.

Khalid Belkhyour explains: “As for mobile TV, satellites are increasingly seen as a key enabler for this emerging market as they provide an easy, rapid, and affordable way to fill the gap for linking content editing locations with the network of retransmitting towers. With respect to broadband, it is expected to grow at an attractive CAGR of 19 percent plus during the next five years, and that’s the reason why we have invested in Ka-band capabilities in some of our 5th Generation satellites currently under construction.”

However, beyond the Kingdom of Saudi Arabia and the other relatively high per capita income countries such as the UAE, Qatar, and Kuwait, mobile TV is also being offered by a number of providers in Egypt and Jordan, and even being pitched to lower income migrant workers across the region.

With a population that is almost 80 percent composed of immigrant communities, mostly Pakistanis, Bangladeshis, and Filipinos, the UAE market provides an ideal testing ground for the marketing of mobile TV to expatriates.

A case in point is the international Cricket World Cup. Etisalat became the only mobile operator in Asia to offer live coverage of the matches taking place in the West Indies. Qatar was the third country in the world to launch a mobile broadcasting service in the Digital Video Broadcast Handheld DVBH digital standard. Many other stations have similar plans for mobile broadcasting in the works. Currently, most telecom operators opt for a mix of channels that includes a core of news, sports, and entertainment. For example, in Bahrain, where MTC Vodafone is the sole operator, eight channels are available, including both Bahraini and international channels, offering the core categories as well as religious programming.

In an interview in IPTV in Focus, Ervin Leibovici, CEO of Bitband, predicted the rollout of IPTV services across the globe: “In developed countries, the main driver behind telcos’ initiations to deploy IPTV is the threat and competition posed by either cable providers or alternative carriers and service providers. In these situations, the challenge is not only to successfully deploy an IPTV service, but also to introduce new applications and rich content, thus creating a differentiation. Developing regions have to first address the installation and operation of the appropriate infrastructure to support IPTV, and identify the window of opportunity for deploying and presenting the service. Once the new infrastructure is in place, time to market for IPTV services can be expedited in the developing regions, given the lack of need to deal with legacy environments and huge past investments that need to be best exploited.”

Developing countries are moving ahead and are catching up with new technologies, especially mobile and telecommunications, mainly because they are driven by the private sector. Governments in developing countries lean toward issuing licenses to the private sector because it provides the country with the needed services, shares some of the profit with the government, and saves it from having to allocate the time and budget to implement it. Some licensees in the region partner with other firms to improve the quality of their services.

For example, Dubai-based telco DU has selected iPlex UltraCompression IPTV video processing and transcoding system from Tandberg Television, part of the Ericsson Group to provide bandwidth savings for its ethernet-to-home network, as well as density and improved picture quality

On the other hand, developed countries are recognizing the opportunities and benefits of investing in the Middle East region. For example, Exterity, a Scottish-based network IPTV equipment manufacturer, has expanded its global presence by opening a sales office in Dubai after being present in the Gulf and Middle East through resellers for the past three years. Colin Farquhar, CEO of Exterity, stated in a press release: “Exterity has been working with a number of resellers in the Middle East for the past three years, but as demand steadily rises in the region for our products, we wanted to give our partners access to on-the-ground support.”

HDTV
The 2007 industry report on HDTV channels conducted by the Satellite Industry Association (SIA), projected a global 600% growth in HDTV channels over the next five years, with an average annual growth of 35%. There is no doubt that broadcasters and production houses in the Middle East are keen to make the transformation to HD. Even though many will not necessarily transmit content in HD yet, they increasingly recognize the importance of future-proofing their archives.

Mr. Belkhyour, CEO of Arabsat says: “HDTV is definitely the most promising new segment in MENA, as there seems to be a consensus among all major analysts that it is expected to grow by a five-fold order of magnitude during the next four years. As of 2008, the convergence of positive and progressively mature market drivers in MENA is preparing and facilitating the takeoff of HDTV. For satellite operators, the opportunity may come from the possibility for them to make a package of channels available to telecom headends, providing them with a one-stop-shop ‘headend-in-the-sky’ solution.”

CABSAT 2008, the region’s largest event for the electronics, media and satellite communications industry, hosted a live HD studio in partnership with Salam Media Cast, a leading solutions provider and system integrator in broadcasting and telecommunications. They demonstrated the process of setting up an HD studio working environment, including production, post production, tapeless workflow, display, uplinking, and downlinking on Arabsat’s BADR-4.

“This is not the first time we support promoting HD in the region,” added Mr. Belkhyour. “During the MEB exhibition and conference in 2005, Arabsat and the MEB Association demonstrated the first live HD channel in the Middle East. Arabsat will always support such efforts as a matter of a fact.”

David Lim, Industry Group Manager of Dubai World Trade Centre said, “HDTV offers the gateway to a hightech lifestyle and HD Studio “Live” demonstrated the prominent role of HD technology. Numerous surveys have already identified consumers who own HDTV sets want the premium visual quality of HD broadcasts. It is just a matter of time before broadcasters respond to these demands, realizing how HDTV can drive revenue and value for viewers in the digital media age.”

E. Educational and Training Institutions
The lack of talent and trained personal remains a gap in the industry and a key concern among TV stations in the Middle East. With no internship or graduate schemes to aid university students, training has often been neglected, but private companies are compensating for the shortcomings of universities or the public sector. Sony, for example, has recently launched a new HD training center located in their office in Dubai Media City, aimed to train and educate Sony’s channel, customers, and staff, so they can have first-hand experience of its innovative high definition and networked solutions. Training is also being offered by:

New York Film Academy (NYFA) which joined forces with the Abu Dhabi Authority for Culture & Heritage (ADACH). The Academy established a world-class film school that will become an educational center for the nascent film industry in Abu Dhabi and the region. The center will offer a one year film degree as well as various film-related workshops this year.

Dubai International Film Festival (DIFF) became a training ground for Arab filmmakers. It includes a project market, a producer’s training program, and a screenwriting master’s class. It has entered into a strategic alliance with the prestigious Cannes Producers Network, and awarded three Arab producers this year. DIFF also initiated Professional Coaching for Producers, a pioneering training course created in conjunction with the European Audiovisual Entrepreneurs (EAVE). It featured plenary sessions, meetings, expert panels, and case studies on various topics. DIFF collaborated with Showtime Arabia and sponsored a first-time comedy master class, as well as a production make-up workshop presented by MAC.

Red Sea Institute for Cinematic Arts was initiated in Jordan in partnership with University of Southern California’s School of Cinematic Arts, engineered by the Royal Film Institute of Jordan. The two-year MFA program will provide the burgeoning regional film industry with highly trained professionals in all aspects of pre-production, production, and post-production classes that will start in September of this year.

Bahrain’s Ahlia University independently funded the establishment of its state-of-the-art HD-equipped production facility a year ago. University President Abdulla Al-Hawaj says that it aims to provide technical training to students and professionals, not only in Bahrain but also in the region. “We believe that the broadcasting industry in the region is massively growing and it lacks the trained personnel to support it,” he says. “We also aim to contribute high quality productions to the industry.” Ahlia University is planning projects to “establish a footprint in the field.” It began with offering public workshops in February. Ahlia says it will have its full curriculum developed and ready to welcome students by September 2009.

MEB & NAB Program
Conducting business during an economic downturn or recession requires considerable planning and is loaded with risks; however, venturing into emerging markets can help companies compete and even thrive during difficult economic times.

The MEB and NAB associations have strengthened their collaboration in order to connect NAB Show exhibitors with the continuously growing broadcasting market in the Middle East and provide them with strategic tools to help overcome the challenges of venturing into new markets, such as: managing a global work force, overseeing international contracts, and responding to the requirements of foreign governments and industry regulators. Association members will enjoy the following benefits:ciation members will enjoy the following benefits:

1. Reliable information, articles, research, and studies.

2. Information addressing safety concerns.

3. Marketing assistance.

4. Leads for reliable partners.

5. Educate and train students in the Middle East.

“This new program is a true evolution of our partnership with NAB. We are certain that our members will find it useful because it delivers ready-to-implement practical solutions proven to work in the Arab market” says Mr. Ahmad Al Maaz, Founder of MEB. “Growth in the Middle East is extremely demanding. We feel that NAB has the proper professional expertise needed for the regional industry to continue its growth.” Al Maaz continues, “We will further capitalize on our partnership with NAB in order to support Western companies interested in growing sales in new markets.”

“We are in a very exciting time in the electronic media industry.” says David Rehr, CEO of the NAB. “With the globalization of commerce and cultures, there is a real hunger for new content from other cultures.

NAB brings together a universe of visionaries and catalysts to extend the life and reach of content across traditional and emerging platforms worldwide. The Middle East holds high levels of liquidity, and is gaining fast prominence as an attractive emerging market.”

Rehr continues, “We’re pleased to pool our resources with MEB’s to encourage American firms to consider global opportunities. This effort should further enrich the broadcasting industry in both markets. We are excited to launch this program and are looking forward to working closely with MEB on other programs to be announced at a later date.”

For a copy of this report and its updates or to obtain a DVD of the MEB/NAB 2007 conference titled “The Rise of the Arab Broadcasting Market: Exceptional Prospects and Resources,” please contact Ms. Rawan Manna at This email address is being protected from spam bots, you need Javascript enabled to view it
We are looking forward to seeing you during the NAB show at booth C7305.