Satellite saturation?

Author:Taylor, Julian
Position:Business and Finance - The Middle East satellite broadcasting market - Statistical Data Included

The Middle East has become one of the most crowded commercial television markets in the world. The skies above the region are becoming increasingly packed with competing satellites.

Worldwide, the satellite market could reach 145 million households by the year 2005. In the Middle East region alone, it is now possible to receive at least 60 terrestrial and free-to-air satellite channels in Arabic, around five in English and six in Hindi, in addition to pay-TV. This creates a huge potential market for broadcasters.

In today's regional market place, which extends from the Gulf across to North Africa, more than 50 million televisionowning households are classified as potential customers.

The Gulf Cooperation Council (GCC) countries, are particularly important to broadcasters since they are primarily youth markets, with over half of the population under the age of 20, many with high disposable incomes and a particular interest in international programming.

Even more encouraging is that despite the region's economic downturn, significant returns are still being generated. According to the latest statistics available, Arab countries, including the GCC states, spent a total of $1.94 billion on advertising in 1998, an increase of 21 per cent on the previous year, and of that total nearly 46 per cent went into the accounts of Arab satellite television stations.

However, with too many stations now chasing a finite amount of advertising dollars, profit margins may soon fall. Some industry experts say that satellite saturation point has already been reached.

The boom began in 1991 with the launch of the Saudi-owned Middle East Broadcasting Centre (MBC). The strong impact of CNN's coverage of the Gulf War was the catalyst for its launch. Today, Saudi Arabia owns nearly 75 per cent of Arab satellite channels, offering inoffensive programming to Arab viewers.

MBC, the earliest and most respected Saudi satellite station, was one of the first to see the possibilities of reaching Arab homes in Europe and the Americas. It is believed that the channel is currently viewed by more than 40 million people. Widely respected for its independent news and documentary programmes, MBC has gained large audiences. But it remains to be seen whether it can continue to thrive in the midst of the growing competition from other Arab news channels, especially Qatar's Al-Jazeera.

When Al-Jazeera began offering Arabs differing views more than two years ago, it initiated something...

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