EXCLUSIVE: Qatar’s beIN Media Group, already a major player in global sports rights through its beIN Sports brand, is set to expand into general entertainment programming. The new pay TV service will initially roll out across the Arab world in the coming months and could be a potential game changer for a region that has traditionally been dominated by free-to-air channels. While the Arab TV market has always had at least one major pay TV platform- previously the likes of ART and Orbit, currently OSN- there has arguably never been a company quite as deep-pocketed or ambitious to take on the over 500 free-to-air satellite channels that currently dominate the airwaves. Quite simply, the resources at beIN Media’s disposal ease the burden of needing to find a financially viable model of return. BeIN Media execs declined to comment.
The reasons behind the expansion into general entertainment fare are simple. With the company reaching a ceiling in terms of subscribers- commonly male-centric sports fans- beIN Media execs now want to target female subscribers. To that end, they have already begun serious discussions with a number of U.S. studios about taking over current pay TV market leader OSN’s output deals for Western films and series when they expire. Deadline was also informed by multiple execs with knowledge of the discussions that execs are also looking to see if any potential breaches of OSN’s commitments- such as non-timely payment- have occurred, thereby creating loopholes for those output deals to be replaced before their full term.
The pay TV landscape is changing rapidly across the Arab world. Starz launched Starz Play Arabia, its subscription online video service, across 17 countries in the Middle East on April 2 this year. Netflix is also expected to launch its own OTT service in Q1 of 2016. Two thirds of the Arab world’s population of 370 million people is under the age of 30. That youthful market is a hungry consumer of entertainment. While broadband penetration can be patchy across the region, mobile penetration is through the roof. In the U.A.E., for example, there are more mobile phones than there are people.
The Arab world is proliferated by free-to-air TV networks, with more than 500 channels vying for eyeballs and ad dollars across the region. Of those, the vast majority lose money but, given that many are owned by wealthy individuals or political/governmental entities, few, if any, ever shut down. While free-to-air has traditionally been the name of the game, there are some who have tried, generally unsuccessfully, to create a viable pay TV model. That could now change with the entry of beIN Media.
The less controversial, non-political arm of Qatar’s Al-Jazeera Media Network, beIN Media is already the dominant sports broadcaster in the Arab world and increasingly beyond after its successful re-branding from Al Jazeera Sports in 2014. The platform operates across the Middle East and North Africa, France, the U.S., Canada, Indonesia, Thailand, Hong Kong, Philippines and Australia. Just this week, it closed a deal with Major League Soccer (MLS) to broadcast its games across Southeast Asia and Australia.
In an even more significant move, the company finally confirmed this week its long-in-the-works acquisition for Turkey’s biggest pay TV network Digiturk, for a figure believed to be in excess of $1 billion. That purchase was as much political as it was commercial given Turkey’s geographical and cultural proximity to the Arab world. Dubbed Turkish dramas have dominated Arab TV grids for close to a decade and offering content across both Turkish and MENA territories will potentially give beIN execs a scope and scale rarely seen in the region before.
This being the Arab world, however, politics is likely to have a say in just how successful beIN’s venture ultimately becomes. While the company’s initial focus appears to be on western entertainment, for it to truly establish itself it will need to move into local Arabic language programming. The Arab TV world’s single most important- and lucrative- season is the just finished holy month of Ramadan, when broadcasters wheel out brand new, big budget 30-episode dramas for the family to watch together in the evening as they break their fast. Broadcasters can spend- and make- up to a third of their annual budgets in that one month alone. The name of the game is local content. For beIN Media to break into that market, it will need to talk to the existing pan-Arab players who already dominate share.
What’s more, Qatar is something of a political lightning rod in the region. It remains bitterly at odds with neighboring giant Saudi Arabia. Arab viewers have largely ignored those considerations when subscribing to beIN’s sports packages, including for the World Cup. Football, after all, will generally trump geopolitics.
Whether the Saudi market- the single key advertising market in the region- or Egypt- the region’s next most important market and another political foe of Qatar’s ruling family- is quite so ready to allow for a Qatari-backed platform to get a foothold inside its home and access its daily family life is another question.
Whatever happens, the Arab TV landscape is set up for its largest shakeup in over a generation, arguably since the launch of the first free to air, pan-Arab satellite channel MBC in 1991.