This backdrop is promoting demand for concepts such as convergence, technological upgrades, and cord-cutting at an individual level – although most households will maintain a TV connection for the foreseeable future.
Where broadband infrastructure permits – especially in the GCC and in Turkey – OTT services are gathering momentum, tapping into the young segment that tends to spend more of its disposable income on new communication services, giving them a chance to succeed.
According to Ovum research, however, cord-cutting in the region should not be overstated, and the type of users accessing premium TV packages are the ones most likely to be first adopters of premium and international OTT-SVOD services like Amazon, Starz and Netflix, and OTT-SLIN (subscription linear) services like beIN Connect.
In content genres, the pay-TV staples of sport and films are important. OSN and beIN are battling out for regional pay-TV dominance, though the pair are not exactly competing directly, OSN has largely preserved most of its Hollywood studios contacts since beIN entered the entertainment space a couple of years ago, whereas beIN’s strength against OSN remains in sports rights.
In the meantime, beIN is negotiating hard with IPTV telcos in the GCC in the carriage of its channels, not only in premium sports but also children’s channels.
On occasions, some telcos have seen a cut-off in access to sports and kids channels, leaving many triple-play users frustrated with their telecoms provider. The balance of power is now clearly back with the pay-TV operators, having seemingly shifted to the telcos some five years ago.
Look out for the Media + Networks white paper on the MENA region, due to be published in early July.
Ismail Patel is a Research Analyst in Ovum's TV team. He focuses on global TV markets, particularly in the MENA, Sub-Saharan Africa and the Asia Pacific.
His research includes assessing pay-TV operator strategies, next-generation TV, and profiling companies and new start-ups that can disrupt traditional TV