The popularity of series including Al Ishq Al Aswad and Game of Thrones is driving the growth of the pay TV market in the UAE and the wider region, according to service providers and analysts.
The Middle East and North Africa recorded the largest increase in subscription-based TV revenues last year globally, according to a report by the market intelligence provider IHS Technology.
Revenues increased to €873 million (Dh3.49 billion) from €702m the previous year as the number of households using pay TV rose 12.4 per cent to 4.8 million.
The region’s young, media-literate population with its developed “international tastes in TV content” creates a huge opportunity for investors according to IHS’s senior analyst Constantinos Papavassilopoulos, who wrote the report.
Subscription-based TV platforms in the UAE, include du, Etisalat, OSN and Dubai-based My-HD Media.
Local Arabic content and international programming from Turkey, Bollywood and US networks such as HBO, which makes Game of Thrones, are driving the expansion of the pay-TV market. In 2013, the OSN chief executive David Butorac said the company would invest US$500 million up to the end of this year in acquiring local and foreign content.
IHS also attributed the performance of the pay-TV market in the Mena region last year to a combination of the increase in Arabic language content, antipiracy measures, and the Fifa football World Cup last summer.
However, broadcasters are struggling to make sports programming profitable amid high costs, according to IHS.
“Sports, and especially football, is also driving the pay-TV market, however, the cost of international rights for football competitions is extremely high in the Mena region and is causing a lot of frustration and disappointment to pay -TV operators,” said Mr Papavassilopoulos.
The pay-TV market is expected to grow despite the rise of online television providers such as icflix, according to OSN, one of the largest service providers in the region.
“Online providers have diverse and significant challenges including the need for huge investment in state-of-the-art technology,” said Khulud Abu Homos, the executive vice president of programming and creative services at OSN. “Sourcing content that customers really want to watch is another challenge [for the online providers].”
The growth of pay-TV in the region over the next four years will be five times higher than in the US, UK, Germany, France and Italy, IHS said.
The number of primary pay-TV households in the Mena region is expected to reach 6.6 million, with revenues at €1.7bn, by 2019, according to IHS.
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