tv middle east & africa miptv 2012

MIPTVEDITION

Pay-TV ChannelsOSN Network’s David Butoracwww.tvmea.ws THE MAGAZINE OF MIDDLE EASTERN & AFRICAN TV APRIL 2012

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TV MIDDLE EAST & AFRICA 5

Business has been increasing in the Middle East andAfrica for FremantleMedia Enterprises (FME). “Inrecent years, these regions have proven to be tremen-dous growth areas for FME, so much so that last yearwe even opened our first Middle Eastern office, inDubai, to help facilitate the continuing [expansion] inour business,” says Jamie Lynn, the senior VP of distri-bution for the Middle East, Southern Europe andAfrica at FME. He adds, “In Africa it has been equallyexciting, and we anticipate growth in the more estab-lished markets while expanding our business in thedeveloping sub-Saharan markets.”

The company is offering up its brand-new dramaThe Wedding Band, as well as the series Hidden. AnthonyBourdain returns in his new series Anthony Bourdain:The Layover, which features the renowned chef explor-ing an unexpected destination in less than 48 hours.

• The Wedding Band • Hidden• Anthony Bourdain: The Layover

FremantleMediaEnterpriseswww.fmescreenings.com

• Abyss of Passion• CQ• Little Giants

Televisa Internacional

For MIPTV, Televisa Internacional is highlightingtelenovelas in English, French and Portuguese forbroadcast in Africa. The novela Abyss of Passion is a storyabout four friends whose destinies and happiness areseriously damaged by resentment, ambition andbetrayal. Little Giants is a family-friendly reality com-petition series. The light-entertainment format featureseight teams of children aged 4 to 12 showing off theirtalent in singing, dancing, acting and stand-upcomedy. Also on offer is the original series CQ, whichTelevisa co-produced with Cartoon Network LatinAmerica. It is a live-action comedy series about eightteenagers who attend a unique high school, experi-encing life’s challenges and adventures together.

Televisa is working on co-productions with Turner,Nickelodeon, Record TV in Brazil, MTV, Lionsgateand Sony, according to Mario Castro, the company’sdirector of new businesses.

www.televisainternacional.tv

Ricardo Seguin GuisePublisher

Anna CarugatiEditor

Mansha DaswaniExecutive Editor

Kristin BrzoznowskiManaging EditorMarissa GraziadioEditorial Assistant

Simon WeaverOnline DirectorMeredith Miller

Lauren UdaProduction & Design

DirectorsPhyllis Q. Busell

Art DirectorCesar Suero

Sales & MarketingDirector

Terry AcunzoBusiness Affairs Manager

Vanessa BrandSales & Marketing

Assistant

Ricardo Seguin GuisePresident

Anna CarugatiExecutive VP &

Group Editorial DirectorMansha DaswaniVP of StrategicDevelopment

TV Middle East & Africa© 2012 WSN INC.

1123 Broadway, #1207New York, NY 10010Phone: (212) 924-7620

Fax: (212) 924-6940Website:

www.tvmea.ws

IN THIS ISSUEChanneling ArabiaMajor internationalchannel brands arestepping up their efforts in the Middle East 6

InterviewOSN Network’sDavid Butorac 12

“MIPTV is a veryimportant market thatwill have a greatimpact on [our] salesfor the year.”

—Mario Castro

“We are continuing ourhistory of bringing some top hitcontent to the market and willcontinue to do just that.”

—Jamie Lynn

CQ

Hidden

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Politically, the Middle East remains in tur-moil, and on the ground there are some

very real challenges to be solved. But over-head, the 600 or so satellite channels continueto make progress. The past year has also seenhigh-definition television catch viewers’ imag-inations, and major infrastructure projects, likeAbu Dhabi’s twofour54, starting to make a realimpact on the market. Indeed, twofour54 is already providing a

comfortable home to international mediagroups such as Turner Broadcasting (withCNN’s latest pan-regional bureau as well as theCartoon Network Animation Academy), Via-com (Comedy Central Studios Arabia), NewsCorporation’s BSkyB/Sky News Arabia, thegames house UbiSoft, and local initiatives suchas Tropfest, a short-film competition.The progress also extends to the pay-TV sec-

tor. The much-maligned Orbit and Showtimeplatforms are now finding that as a mergedentity, OSN Network, they are helping solvesignal piracy as well as pushing the pay-TVenvelope with high-definition channels, andtapping into advanced technology such as VODservices, in a deliberate attempt to differentiatethemselves from the free-to-air players.Viacom is a perfect case in point. Its Indian

joint venture with Network18, Viacom18, isextremely busy in the Middle East, pushingits top-rated Colors network into the Gulf aswell as providing feeds such as MTV India’senergetic Bollywood content alongside theestablished MTV International and MTVMiddle East signals.

EYES ON THE GULF Gaurav Gandhi, Viacom18’s head of distri-bution and international business, says thatin the five years since the joint venture wasformed it has enjoyed remarkable success,first in India and now in the Middle East.“The JV now has six broadcast brands, a cou-ple of HD brands, the movie arm, and otherprojects under way. These include expansioninto other nearby regions, including theGulf,” he says. “There is a huge [South Asianpopulation] outside of India and this is ourinitial target audience. Around the world thisequals about 25 million to 30 million people,but the big pockets are the U.K., the U.S. andthe Middle East. It’s natural that any Indianbroadcaster would want to try and reach this

6 TV MIDDLE EAST & AFRICA

378 World Screen 4/12

Major international channel brandsare stepping up their efforts in the

Middle East. By Chris ForresterArabiaChanneling

Sky News Arabia presenter Nada Al-Shaibani.

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huge audience. We get a double advantage. By and large, andunlike many U.S. and European networks, we hold onto ourIP rights to the shows. Therefore [the process to] get inter-national channels up and running is much simplified.”Gandhi explains that Colors’ international efforts started

in early 2010 in the U.S. and the U.K., expanding to the Mid-dle East later that year. “Initially we started out on the Pehlapay platform run by ADD”—Arab Digital Distribution, aportion of the old ART bouquet. “Then our focus was toget the channel on air and establish ourselves as a serious con-tender for viewers. For the first year the Pehla team was sell-ing our advertising. Now we have our own office, focusing onexpanding Colors in the region and into Africa, and Africa isnow a big market for us given that we are available in manylocal markets, not least Kenya. [Our second priority] was toset up our own advertising operation. Third, we needed anoffice to look after our various marketing initiatives.”Gandhi admits that piracy has been a problem, although

progress is now being seen. At the moment, however, free toair is not on his agenda. “The problem with the free-to-airmarket, at least for us, is the absence of audience measurement.It means we are very limited as to how we can monetize afree network. For us, a combination of pay-TV [affiliate rev-enues] plus advertising income works very well. With peoplemeters in place it could be a very different argument. Out ofthe UAE’s total population of about 8.3 million, almost half

are South Asian, made up of expat Indians, Paki stanis andBangladeshis. That’s a good audience, but the advertising cakeis minuscule, even for Arabic channels. Once measurement isin place then we will look at free services.”Viacom18 is, however, firmly behind localization.

“When you look at the Middle East—and India for thatmatter—the best- performing shows have been localized,”says Gandhi. “We launched Comedy Central India on Jan-uary 23, and at Abu Dhabi there’s excellent work goingon for their Arabic localizations.”

ON THE LAUGH TRACKComedy Central Studios Arabia is a joint venture of ViacomInternational Media Networks and twofour54, led by SharifMaghraby as managing director, that aims to seek out newcomedic talent and bring concepts to the screen. “It is not achannel yet,” admits Wayne Borg, twofour54’s deputy CEOand COO. “However, it is clear that when you have such astrong portfolio of shows in development then it is only amatter of time before one of them gets to air. The team isextremely hopeful about a new weekly comedy sketch show,already with a pilot in development and considerable inter-est from local broadcasting majors.” FOX International Channels, meanwhile, has taken a different

approach to localization. “Like a lot of foreign players, we usedto have a traditional strategy of, let’s take one of our existing feeds

Prayer room: National Geographic

Abu Dhabi recentlyfeatured UAE Marvels,

looking at structuressuch as the Sheikh

Zayed Mosque.


and throw some Arabic subtitles on it and beam it in from Europeor Asia and sell it to the pay-TV operator,” says Ward Platt, thepresident for the Middle East and the Asia Pacific at FIC. “Wechanged that approach about four years ago. We started to launchfree-to-air satellite channels and we invested further in our pay-TV channels. We have a Fox Movies free-to-air Hollywoodmovie channel, we have a FOX free-to-air international TV serieschannel, all dubbed in Arabic. We have FX, another free-to-airchannel with edgy TV series, all subtitled in Arabic. We have NatGeo Abu Dhabi, in partnership with Abu Dhabi Media, 100- percent dubbed in Arabic, and we’ve launched Nat Geo Farsi. Atthe same time, we’ve been able to grow our pay-TV business.We focus much more on the HD strategy there.”Another company that operates a suite of services in the region

is BBC Worldwide Channels, which distributes BBC Entertain-ment and BBC Lifestyle exclusively on OSN, and the morewidely available BBC World News.“The BBC has a long-established reputation for innovation,

quality storytelling and high production values,” says IanMcDon ough, the senior VP and channel manager for EMEA atBBC Worldwide Channels, who also oversees a five-channelbouquet in Africa. “By segmenting a portfolio along genrestrands, we have provided a one-stop shop for the entire family.”A core area of focus for BBC Worldwide Channels has been

investing in distinctive programming for the portfolio. “A keypart of our strategy is to provide our viewers with events thatunite audiences worldwide,” McDonough says. “The broadcastof the royal wedding last year across our global networks was ahuge success and we plan to air several more events of thisnature during 2012.”

ARABIAN TOONSTurner Broadcasting, too, has a number of channels presentin the Middle East: Cartoon Network, Boomerang andTurner Classic Movies, all in English, are on pay TV withOSN, while CNN is free to view. Alan Musa, Turner’s VPand general manager for the Middle East and Africa, adds,“Within the free-to-air space we have Cartoon NetworkArabia, which has all been either dubbed into Arabic or pro-duced in Arabic.”In many respects it is Turner’s activity within Cartoon Net-

work Arabia that is the most interesting. With twofour54 ithas formed an animation academy, and its first batch of stu-dents not only graduated (toward the end of last year), but

are working on new concepts that are being examined by thenetwork. Fifteen new students started their studies in January.“Our project at twofour54 is essential to the long-term ambi-

tion for our business in the Middle East,” Musa explains. “TheCartoon Network Animation Academy enables us to identifyand incubate the creative talent that exists in the Middle East; ourCartoon Network Studios Arabia then allows us to nurture thistalent through development, mentoring, and hands-on experi-ence in developing concepts from ideas to story board, pilot and,hopefully, full series. The final part of this particular journey is theambition to create full series that will feature prominently onCartoon Network Arabic, and possibly internationally. The con-sumer and commercial success of these local productions willthen enable investment back into the talent pool that exists in theregion and continue the cycle of creating content.”Musa says that the start of the process has delivered up two

pilots. “Both are underpinned by the creative talent that wehave identified in the Middle East—how exciting is that!” Borg from twofour54 adds, “There’s a change taking place

here, where Abu Dhabi is being recognized as an ideas capi-tal, and we want to increase that role. We want to encouragetalent, of course, and get young people excited about mediaand in doing so overcome certain local taboos about work-ing in TV and its related services.”Borg explains that, as is true everywhere else on the planet,

every Middle Eastern youngster wants to be a soccer, movieor pop star, and sometimes all three! But there is very littleexposure to the real needs of the broadcasting or productioncommunity. Over the next five to seven years estimates arethat about 9,000 media-related positions will need to be filled



Delicate balance: A+E’s HISTORY, delivering originalslike IRT DeadliestRoads, is using subtitling as one wayof localizing its MENA feeds.

Redrawing the future: Turner Broadcasting aligned withtwofour54 for the Cartoon Network Animation Academy.


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locally. And as part of that mix they anticipate that an abun-dance of new talent will emerge. Borg says that of the 2011 CN Animation Academy

trainees, three went on to join Cartoon Network. The grad-uates are helping develop their own projects, and workingclosely with those who are now submitting ideas into theCartoon Network ideas pool.Turner’s Musa says he envisions more of these strategic relation-

ships emerging. “I see long-term partnerships being establishedwithin the region that will encourage the growth of local pro-ductions—whether it’s in the news genre, generalentertainment or kids’ space. I imagine the topic ofresearch, and a more industry-wide, region-widemetric being an option for the future that will giveall parties within the media business the clarity andcurrency that is needed.”

LOCAL CURRENCYDean Possenniskie, the managing director forEurope at A+E Networks, who also oversees thecompany’s business in the Middle East, sharesthat sentiment. “Almost all of our content islocalized, usually with subtitles, and OSN looksafter that for us. Sometimes they include a Farsioption for that audience, which we see as beingcritical to reaching the market and building abroader subscriber base. From our point of view,we are focused on bringing the best of ourinternational content to the Middle East. So weare not commissioning local programming, butat the very least subtitling is very important.With the networks that we currently run, weremain loyal to pay TV.”For Food Network on OSN Network, mean-

while, localization efforts have included on-the-ground events. “We attended the Taste of Dubaifood festival [in Dubai in March] and had one ofour newest chefs, Aarti Sequeira, participating incooking demonstrations for us,” says Nick Thoro-

good, Food Network’s managing director for EMEA,who notes that the Middle East is “a key focus forgrowth” for the channel.A+E’s Possenniskie is bullish on the pay-TV

model because of its subscriber revenues. He remainscautious about free TV because of the absence ofaccurate audience measurement in the market. Nev-ertheless, he admits that A+E remains open to devel-oping new concepts for local free-to-air channels.However, he says, “the greatest barrier to those [con-cepts] is the investment, and it would be a significantinvestment. There’s a huge problem with measuringviewers. When I first got involved in the Middle East,the worry then was the lack of audience measure-ment and here we are, six or seven years later, stillcomplaining about the same issue. It is really a majorconcern that has yet to be cracked. It’s good that wenow have more proactive interest in this from peo-ple like Abu Dhabi Media and we wholly supportany initiative that can start measuring this audience.Until that happens, we will stay with pay TV.”Dubai has its busy Media City, and it is fair to say

that despite the political problems in Egypt, Syria and Lebanon,the local production houses have never been busier. And newentrants like twofour54 are nurturing the talent of tomorrow.Borg says that during three of the worst financial years onrecord, the Abu Dhabi initiative has grown beyond expectationsto permanently host some of the biggest world media namesin the industry. The fact that the likes of Turner,Viacom, Disney,News Corp., Discovery and other key players are investing inthe region shows that, as elsewhere on the planet, they arethinking globally, but quite definitely acting locally.



The main event: BBC Entertainment has made some high-profile acquisitionsfor its feeds in the Middle East and Africa, including ITV’s Titanic.

Eastern appeal: Food Network is bringing its Britishoriginals to the MiddleEast, such as Reza,Spice Prince of India.

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By Mansha Daswani In 2009, after a 15-year battle for supremacy in the pay-TV land-scape in the Middle East and North Africa (MENA), Orbit and Show-time merged their operations to become OSN Network. Shortly afterthe combination, OSN chose pay-TV veteran David Butorac as its newCEO. With a career that includes positions at the pan-Asian STAR,Malaysia’s Astro, BSkyB in the U.K. and FOXTEL in Australia,Butorac is tapping into his extensive experience to build out OSN’sbusiness in the rapidly developing MENA region. He speaks toTV Middle East & Africa about his focus on original content,shorter windows on imported shows and driving HD and DVR rollouts.

TV MIDDLE EAST & AFRICA: When you came to OSN,what was your strategy for the recently merged platform?BUTORAC: If you look at the history of pay TV all over theworld, there were often competing platforms; I was around inthe Sky days before the merger [with BSB] and lived throughthat. The difference is that BSB and Sky competed with eachother for two years and Showtime and Orbit competed witheach other for 15 years. In 2009 they merged and that createdan opportunity to grow out the platform. The shareholdersalso made a really bold decision to invest in a completechange of the CA [conditional access] system and boxes, sothat we could have a secure platform. Piracy was hurting thebusiness badly. So the businesses finally had merged, we’dovercome piracy—that [served as] the bedrock for growth. The key for me is being able to get the consumer to reengage

with pay TV after 15 years; a lot of them had looked at pay TVand decided there was nothing there for them. We now haveto encourage them to reengage and [we need] to invest in local-ized content. We’ve just embarked on investing in original Arabic-language entertainment content. Over the last two years we’vequadrupled our marketing spend. We have quadrupled ourspending on research so that we can actually understand theconsumer a lot more. [We’ve also created] a stronger brand:

we’re no longer Orbit Showtime Net-work, we’re OSN; it’s a much easier,articulated brand.

TV MIDDLE EAST & AFRICA:You’ve also been rolling out importedshows almost day-and-date with theirU.S. release. Does that help to discour-age piracy?BUTORAC:What we do with all of ourmajor series now is that we’re within 24hours of the U.S release. So when Des-perate Housewives season nine aired in theU.S., 24 hours later it was on our screensin the Middle East. All of the majorseries: Pan Am, Boardwalk Empire. BSkyBlaunched Sky Atlantic in March 2011with Boardwalk Empire. We aired the seriesin September 2010. We were six monthsahead of the curve. We do that to stopthe imperative to download. Why wouldmy teenage daughter download con-tent? Because she wants to watch it assoon as it’s available. If we can deliver itin beautiful high definition on a beauti-ful TV screen, why download it ontoyour laptop?

TV MIDDLE EAST & AFRICA: What are your plans foroffering your viewers access to content on multiple platforms?BUTORAC: We’ve committed expenditure to build out ourdigital platform, which commenced in the first quarter of2012. I want our customers to feel the value proposition oftheir broadcast subscription extending way beyond the TVscreen. They can have content on their tablet, on their smart-phone, on their PC, on their laptop. So long as we get theDRM [digital rights management] right, the studios will behugely supportive of this. Initially it will bring churn ratesdown, eventually it will also add to incremental revenues.

TV MIDDLE EAST & AFRICA: What are some of the otherstrategies you’ve put in place to reduce churn and increaseyour ARPU?BUTORAC: Lowering churn is about providing a high-qualityproduct and making a value proposition for subscription televi-sion. What we’re doing is investing in local content and makingcertain we can shorten the windows of the content, have con-sistency in our approach and have a quality customer-care expe-rience. All of those go together to bring churn down. In the last12 months we’ve halved our churn rate. At the same time [in2011 we increased] our subscriber base by 34 percent. So thesubscriber base is taking off, the value proposition is taking off,the churn rates are dropping. And that’s all to do with the qual-ity of content. The emphasis is on HD. We now have 19 true1080i HD channels—no one else in the region is doing it.

TV MIDDLE EAST & AFRICA: How has the takeup beenfor your DVR and HD services?BUTORAC: DVR and HD are two really important strategies.Our premium customers get a free DVR. Over 60 percent of ournew customers are coming in at premium. Once you experience



OSN’sDavid Butorac

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television on a DVR, you don’t go back. We just commissioned anew hybrid set-top box, which will have a terabyte of hard drivespace. It will be an Internet-connected box as well, so we can dotrue VOD downloads, we can do all sorts of connectivity betweenthe satellite stream, which is our primary distribution, and theInternet. We will continue to stay on the front end of the curvewhen it comes to that level of technology. And there are400,000 HD panels sold every month in the MENA region.Most of those customers are going home, bolting a beauti-ful television to their wall and watching SD on a nice TV! Aswe expand our HD experience, our viewing share in HD isjust skyrocketing.

TV MIDDLE EAST & AFRICA: Did the Arab Spring protestslast year affect your business?BUTORAC: In terms of our sales, it probably enhanced someparts of the business. It gave us some minor disruptions—par-ticularly in Egypt, Libya. A lot of the areas where there was amovement and change, there was a bit of a distrust of state-run television. We have a myriad international news channels,so what we’ve seen is not a long-term [reduction] of sales inthese markets—it has actually allowed us to continue toexpand. Egypt is going very well for us, even though they’vebeen through the issues they’ve had.

TV MIDDLE EAST & AFRICA: What are your other growthmarkets?BUTORAC: Saudi Arabia is our biggest growth market and soit should be, as it’s got a [high] level of affluence. We need tosimply get our message out about what pay TV is about, andour sales are already taking off. UAE is always a very strongmarket for us. It has a predominantly foreign workforce andwe’re able to aggregate a lot of content. And throughout theregion, if you cut affluence off at household incomes of, say,$25,000 or more a year, most of those households have English-proficient Arabic-speaking locals—a lot of them have beeneducated overseas. So our English-language content is veryimportant. The number one driver is English-language movies.The big markets of the Gulf states—Kuwait, UAE, Bahrain,

Saudi Arabia—and the volume marketslike Egypt, that’s where you’ll see thebiggest growth.

TV MIDDLE EAST & AFRICA: Whatkinds of content packages are you offeringto appeal to the large population ofmigrant workers in markets like UAE?BUTORAC:There are 3.5 million Filipinosworking throughout the MENA region, andthe South Asian [population], the Hindi andUrdu-speaking [segments], are very strong aswell. We currently aggregate a five-channelFilipino-language package, which is hugelysuccessful, and we’re looking at getting intothe South Asian markets. The South Asianmarket is usually fairly English proficient, soour English-language content will be appro-priate for them as well. But [we’re lookingto] aggregate some of the core sports, par-ticularly cricket, and entertainment from[South Asia]. That’s a focus in the next 12

months. The other significant thing we’re doing is we’re lookingto pull together some French-language content so we can havea package specifically targeted across North Africa.

TV MIDDLE EAST & AFRICA: You mentioned acquiringsome cricket programming. How do you manage the con-stantly escalating issue of sports rights?BUTORAC:The reality is in our region, round-ball sportsrights, i.e. football, have gone to uneconomic levels. The twopredominant sports platforms [Al Jazeera Sports and AbuDhabi Sports] are [government] backed and the economicreturn is not an imperative—we can’t compete with that. Wewould love to aggregate English Premier League football orChampions League football onto our screens, but given therates we’d have to pay for the rights, we can’t do it. We carriedthe Rugby World Cup live and exclusive, all 48 games in HD.We carry a lot of golf and U.S. sports. So there’s a market forsport beyond international round-ball football.

TV MIDDLE EAST & AFRICA: In your current position,do you see any parallels with pay-TV platforms you’ve runin Europe or Asia?BUTORAC: The biggest similarity is with Astro [in Malaysia].Astro is in a multiethnic, multilingual market. What we have inthe Middle East is quite a diverse multiethnic market, albeit ulti-mately a single-language one. If I look at pay TV in the MENAregion, 16 years in existence, it’s at about the same state thatAstro was in back in the early years of this century. I joined Astroin 2002, when we were just on the cusp of taking off—wefloated the company and the business has been hugely success-ful. I see the Middle East region on the cusp of taking off. Wehave an increasingly affluent market. We are a very forward-thinking regulatory environment—that’s a surprise for a lot ofpeople coming from the outside. The key difference is [inMENA] you have about 500 free-to-air channels, all of whichare distributed on satellite. Satellite is the main distributionmeans for free to air. So what we have to do is differentiate ourproduct by quality and by localization. That’s fairly similar towhat we had to do in markets in Asia as well.


A rich experience: OSN launched its Ya Hala! channel inHD last year as a homefor original Arabic-language series as wellas imported fare fromthe region, such as the Turkish hit Hareem Al Sultan.


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tv middle east & africa miptv 2012

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