New research from Informa Telecoms & Media reveals that 61% of Middle East and North African TV homes currently have a multichannel TV service. Informa’s Middle East and Africa TV report forecasts that by 2013 a further 14 million homes will have signed up to a multichannel service, resulting in a penetration rate of 72%. This growth is the primary stimulus for a major increase in the region’s TV advertising revenues, which will grow by 73% in this forecast period, from $1.9 billion in 2007 to $3.3 billion in 2013.
Multichannel TV homes
|
(000) |
2007 |
Penetration |
2013 |
Penetration |
|
Israel |
1,589 |
81.5 |
1,762 |
79.1 |
|
Turkey |
7,678 |
44.9 |
13,890 |
69.6 |
|
Levant |
3,987 |
68.5 |
4,747 |
69.6 |
|
Gulf States |
5,188 |
84.0 |
6,513 |
88.9 |
|
North Africa |
16,366 |
62.2 |
21,532 |
68.9 |
|
Total MENA |
34,807 |
60.7 |
48,443 |
71.7 |
Source: Informa Telecoms & Media
The report also forecasts that the MENA pay TV market will grow by 38% over the six years to 2013. Informa expects the region’s 5.1 million pay TV subscribers at end-2007 to grow to more than 7 million in 2013. Much of the growth will come from Israel and Turkey, who will account for 4.3 million pay TV homes between them at end-2013.
Adam Thomas, Informa’s media research manager and author of the report, said: “Middle East TV benefits from several encouraging factors, such as the common language and culture for much of the region and a tradition of high TV consumption. Macroeconomic factors are generally positive too and an expanding and young population is creating a media-positive environment.”
Net TV advertising revenues ($ million)
|
|
2007 |
2013 |
|
Israel |
144.0 |
194.8 |
|
Turkey |
1,178.3 |
2,153.7 |
|
Levant |
59.1 |
73.2 |
|
Gulf States |
79.0 |
120.3 |
|
North Africa |
60.3 |
80.0 |
|
Pan-regional |
380.2 |
655.5 |
|
Total MENA |
1,900.9 |
3,277.5 |
Source: Informa Telecoms & Media
While the picture is generally positive, there are also several factors hampering even more impressive growth – such as the disparity, across much of the region, between the disposable income of a wealthy minority and the rest of the population. As a consequence pay TV operators are often restricted to targeting only a relatively small proportion of wealthy locals, while also catering for a sizeable expatriate community. This limited target audience is restricting the prospects for profitability.
According to Thomas: “Some of the major TV operators are loss-making and seem to be some way off financial self-sufficiency. 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.”
