November 2015

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November 2015

MIDDLE EAST

& AFRICA

2015 p01 DTVE MEA15.indd 1

21/10/2015 15:17

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www.amos-spacecom.com pIFC Spacecom MEA15.indd 1

16/10/2015 12:22

MIDDLE EAST

& AFRICA

2014

Middle East & Africa 2015 > Contents

Digital TV Europe November 2015

Emerging players

MIDDLE EAST

& AFRICA

The

Middle East has seen strong growth and increasing competition amongst pay TV players in recent years, with OSN and BeIN Sports fighting to attract subscribers. Recently, the region has also seen the emergence of OTT players, encouraged to launch offerings targeted at a digital-savvy younger generation used to consuming content on mobile devices, the latest entrant being US player Starz. In the 2015 edition of DTVE Middle East & Africa, we survey some of these developments, including interviews with key players, and look at the continued importance in the region of tackling piracy. Africa is now seen one of the world’s growth hot-spots, outperforming emerging markets elsewhere. A number of new pay TV services have emerged, often targeting emerging middle-income groups that find the premium offerings of MultiChoice beyond their reach, while existing players have launched new initiatives to capture this segment of the market. In our 2015 issue of DTVE Middle East & Africa we interview two of sub-Saharan Africa’s emerging pay TV operators – StarTimes, which has expanded across multiple territories with DTH and DTT-based services, and Consat, which has targed middle-income subscribers in one of the continent’s key markets, Nigeria. Finally, we survey the plans of one of the most innovative content players targeting the African market, France’s Trace, which has moved beyond simply offering TV channels to become a player in mobile, events and content creation. l Stuart Thomson, Editor [email protected]

2015 Published By: Informa Telecoms & Media Maple House 149 Tottenham Court Road London W1T 7AD Tel: +44 (0) 20 7017 5000 Fax: +44 (0) 20 7017 4953 Website: www.digitaltveurope.net Editor Stuart Thomson Tel: +44 (0) 20 7017 5314 Email: [email protected] Deputy Editor Andy McDonald Tel: +44 (0) 20 7017 5293 Email: [email protected] Contributing Editor Stewart Clarke Contributors

Contents

Kate Bulkley, Andy Fry, Adrian Pennington, Adam Thomas, Anna Tobin, Jesse Whittock

The Middle East: the big picture

2

OTT is making an appearance in a market that remains dominated by FTA satellite TV.

Sales Director Patricia Arescy Tel: +44 (0) 20 7017 5320 Email: [email protected]

The middle ground

6

Competition is heating up in premium TV in the Middle East. Rebecca Hawkes reports.

Africa: the big picture

12

Africa represents a huge pay TV opportunity, but the outlook varies between countries.

Star performance

Publisher Tim Banham Printing Wyndeham Grange, West Sussex

16

StarTimes’ Michael Dearham tells Andy McDonald about his company’s pay TV ambitions.

Consat’s Nigerian journey

Art Director Matthew Humberstone

SUBSCRIPTION HOTLINE INFORMA GROUP TEL: +44 (0) 207 017 5533

18

Consat’s Addy Awofisayo explains the Nigerian market to Andy McDonald.

Trace breaks new ground Trace is ramping up its African activities, CEO Olivier Laouchez tells Stuart Thomson.

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p01 Ed Note MEA15v3am.indd 1

20

© 2015 Informa UK Ltd All rights reserved Reproduction without permission is prohibited

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Middle East & Africa 2015 > The Middle East and its growth prospects

1,606,700

45,000

Syria

1,155,700 1,900

Digital TV Europe November 2015

4,250,000 37,000

Lebanon

Iraq

345,300 1,033,900 1,100 365,810

Jordan

Ku

3,510,000 190,000 154,000 3,215,879

Saudi Arabia

Middle East: the big picture Satellite continues to dominate Middle East TV reception, with IPTV and cable restricted to certain countries. However, growing broadband penetration is leading to the launch of OTT services.

2 p02-03 ME Map MEA15.indd 38

Visit us at www.digitaltveurope.net

21/10/2015 16:35

Middle East & Africa 2015 > The Middle East and its growth prospects

Digital TV Europe November 2015

1,400,000 170,000 4,096,000

Iran 335,000 159,300

Kuwait

5,000 5, 177,340 5,000 5 000 00 5,000 195,014

Bahrain ah hrain hrain rai ai Qatar

67,500

100,000 255,000

3,800 496,000 90,000 454,000 1,209,000

UAE

281,900 95,000 207,803

Oman

Cable DTH 1,629,400

DTT

181,000

IPTV

Yemen

Broadband Source: Ovum/WBIS

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p02-03 ME Map MEA15.indd 39

3 21/10/2015 16:35

Middle East & Africa 2015 > The Middle East and its growth prospects

Digital TV Europe November 2015

Middle East: the big picture OTT and IPTV are beginning to make headway in a region hitherto largely dominated by free-to-air satellite, while pay TV is making steady progress, according to recent research.

While

the Middle East and North Africa remains an overwhelmingly free-to-air market, with satellite the main mechanism for distribution of TV signals, there has been significant movement over the last year, with new OTT offerings targeting potential subscribers in the more advanced states across the region. Much attention over the past year has focused on the launch of SVoD services, with Starz Play Arabia emerging as US player Starz’ first major overseas move, creating a service that competes with the offerings of existing players including icflix (pictured). According to research group Ovum, the industry is likely to keep a close eye on Starz’ performance to see how much appetite there is for the kind of service it offers. The upside potential of OTT offerings such as Starz is to provide alternative sources of content to piracy, thereby stimulating the development of the local content industry. However, existing pay TV service providers view OTT as a relatively minor phenomenon, unlikely to have a significant short-term impact, according to Ovum, which nevertheless predicts that total OTT spend across the region will reach US$100 million (e90 million) in 2017, with SVoD representing over 70% of OTT market share. Much of the consumption of OTT, as in Africa, is likely to be over mobile, which enjoys penetration of over 110%, compared with fixed broadband penetration of only about 22%. Existing pay TV providers have their own OTT services, and icflix also provides an SVoD offering. Starz’ service is a the top end of the price range for such services, at US$14 a month. Of the regional players, Ovum believes that Saudi Telecom is best placed to deliver a mass-market VoD service, thanks to its reach. The telco’s Shashati service is currently only available to Saudi Telecom subscribers. Ovum believes that SVoD subscriptions in the MENA region will reach about one million by 2019, but that net additions will start to tail off slowly from 2017.

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Pay TV market Ovum holds that in Saudi Arabia, the key market in the Middle East, IP-based services will grow steadily and that the share of the TV market accounted for by satellite will fall marginally by 2019. Pay TV penetration will grow from about 34% in 2014 to 48% in 2019, according to the research group. Religion-focused pay TV outfit Al Majd takes the lion’s share of the market, with the remainder split between Saudi Telecom and OSN. IPTV will make headway, doubling an admittedly small share of the pay TV total, while overall pay TV revenue will almost double between 2014 and 2019, with DTH continuing to be the dominant platform. The Saudi market continues to be bedeviled by piracy, with an estimated piracy rate of close to 90%, according to the International Intellectual Property Alliance. Ovum also predicts that IPTV will play a significant role in driving pay TV take-up in Qatar, with local incumbent telco Ooredoo’s Mozaic TV service taking the lion’s share. Growth in the longer term is also likely to be boosted by the country’s hosting of the 2022 World Cup. The UAE, a key regional market and centre of media activity in the region, will meanwhile see pay TV revenues grow by about a quarter between now and 2019, according to Ovum. Over the Middle East as a whole, Ovum predicts that IPTV’s share of the pay TV market will rise from just under 8% today to 12% by 2020. OSN is the leading player in the UAE, with fixed-line telcos Etisalat and Du also attracting significant numbers of subscribers. Satellite

accounts for about three in five pay TV homes in the country. Ovum predicts that pay digital satellite will grow its market share between now and 2019, mostly at the expense of free satellite services. Research outfit Digital TV Research meanwhile predicts that pan-Arab platforms will do well between now and 2020, with beIN Sports adding about 768,000 subscribers and OSN adding 530,000. At the end of 2014, Digital TV Research estimates that OSN had 1.162 million subscribers at the end of last year, with BeIN Sports accounting for a further 819,000. In a report published earlier this year, Digital TV Research predicted that pay TV homes in the MENA region as a whole – including Turkey – would reach 21.3 million by 2020, representing a doubling of numbers in the course of the decade. According to the research outfit, 18% of homes in the region paid for a legitimate TV service at the end of last year, which will likely climb to 24% by 2020. Qatar will top the pay TV penetration league in the region by 2020, with 72% of homes signing up, according to Digital TV Research. Pay TV penetration in North African and Middle Eastern countries including Algeria, Morocco, Tunisia, Syria and Jordan is, however, likely to remain below 10%. Digital TV Research predicts that legitimate pay TV revenues in MENA will grow to US$5.63 billion by 2020, 75% higher than in 2010, with Turkey making a major contribution to the regional total. Satellite will continue to account for the lion’s share, generating US$3.76 billion, or two third of the overall total, by 2020. l

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21/10/2015 15:37

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16/10/2015 12:20

Middle East & Africa 2015 > Focus on MENA

Digital TV Europe November 2015

The Middle ground

Despite the region’s overwhelmingly free-to-air profile, competition is heating up in premium TV in MENA, with continued growth for BeIN Sports and OSN and the development of new OTT offerings. Rebecca Hawkes reports.

It

is often said that TV in the Arab world bears little or no resemblance to other international markets. Characterised by free-to-air satellite, content piracy, vast disparity in infrastructure and incomes, large diverse expatriate communities, and over 20 regulatory entities, the Middle East and North Africa (MENA) is a distinct and challenging environment for pay TV operators. Yet despite this, the past year has seen steady growth in the region’s pay TV market, with revenues of €873 million in 2014, up from €702 million a year earlier, according to IHS Research. The number of pay TV households in MENA rose to 4.8 million in 2014, representing 12.4% growth year-onyear, accordng to IHS. In a region of around 60 million homes, however, the pay TV base remains small. Satellite is the prime platform for delivery of both pay TV and the estimated 900 free-

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to-air channels, although IPTV and OTT video services are rising alongside increased broadband penetration in both MENA’s fixed and mobile communications market.

Sport versus entertainment Two players dominate the pay TV sector in the region: OSN and beIN Sports (previously Al Jazeera Sport). The latter’s rise to prominence has coincided with its avid collecting of major international sporting rights, including the Olympics; football’s World Cup, English Premier League and Spain’s La Liga; Formula 1 motor racing; and NBA basketball. It is estimated the Qatar-based operator will attract an extra 768,000 subscribers to grow its base to 1,389,000 by 2020, and increase its revenues from US$281 million (€247 million) in 2014 to US$724 million in 2020,

according to recent figures from Digital TV Research. Until now beIN has restricted its offering to sports, but this looks set to change with beIN Movie channels being trailed in the region, and the acquisition by parent company beIN Media Group of Turkish payTV platform Digiturk in July 2015. Digiturk, which has around 3.5 million subscribers in Turkey, offers a mix of premium sports and entertainment titles – through ties with, among others, Hollywood studios Disney, Paramount, 20th Century Fox, Warner Brothers, Universal, HBO and Lionsgate. “Expansion into the Turkish market is a natural next step for the beIN Media Group due to [the] proximity of [the] Turkish market to [the] MENA region,” said Nasser AlKhelaïfi, chairman and CEO of beIN Media, announcing the long-anticipated acquisition. Constantinos Papavassilipoulos, senior analyst at IHS, believes the Digiturk

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21/10/2015 16:01

Middle East & Africa 2015 > Focus on MENA

Digital TV Europe November 2015

acquisition will have knock-on effects for beIN Sports Arabia. “One way or another beIN Media will enter the entertainment content market. It will do so in Turkey, for sure, but the Middle East is its homeland, so I think it is only a matter of time,” he says. If beIN Media is looking to capture some of the regional entertainment market, Papavassilipoulos fears it could trigger a potential price war in the sector – a mirror image of the spiraling figures spent on premium sports rights in the Middle East. General entertainment in the MENA pay TV sector has so far been dominated by OSN, which offers a wide array of Hollywood, Arabic, Filipino and South Asian content, aimed at the diverse communities of the region, both nationals and expatriates. “In general, the pay TV operators’ offer in Arabic content used to be very poor but, kick started by the success of Turkish dramas in the Arab world, operators are now investing in quality Arabic productions to attract a wider audience,” says Papavassilipoulos. OSN’s Arabic channel OSN Ya Hala HD, now in its fourth year, is a good example of this. It offered 12 new Arabic series for Ramadan 2015 plus catch-up service Ma Fatak TV, allowing users to watch over 20 Arabic drama shows either online or on TV. Come 2016, OSN Ya Hala HD will launch Saturday Night Live Arabia (an Arabic version of the US sketch show), along with localised versions of Prison Break, Mad Men, Ugly Betty and Who Wants To Be a Millionaire. Kosem Sultan (a spin off of the successful Turkish drama series Hareem Al Sultan) is also among OSN’s new content, and an Arabic movie channel, Ya Hala Cinema HD, is also planned for launch next year – no doubt helped by OSN’s recent arrangement of a US$400 million financing facility. “While connectivity has redefined how TV is enjoyed globally, one of the new trends in the industry is how audiences look for regional content that they can relate to. We are bringing more regional flavour with the widest assortment of Arabic programming next year,” says Khulud Abu Homos, OSN’s executive vice-president, programming and creative services. As well as improved Arabic content, OSN’s South Asian offering has

been significantly boosted with its acquisition two years ago of the Pelha pay TV platform. The operator is not neglecting western content though, with the 2016 launch of an HBO-dedicated channel offering, among others, Game of Thrones, True Detective, Girls and Veep, as well as extending a long standing partnership with Hollywood’s Warner Bros. OSN is on course to add 630,000 subscribers between 2014 and 2020 to reach 1,704,000 subscribers, estimates Digital TV Research. The consultancy believes its revenues will rise from US$579 million to US$903 million in the same period. The French-speaking markets of North Africa and the Levant, however, are still growth targets for OSN, which remains more popular in the Gulf region. Premium French content has long been on its radar, but there have been no recent additions.

Enter Starz Play OSN has however made concerted efforts to attract a younger, digital-savvy audience in a region where 60% of the population is under 35, and 70% of online content is now consumed by mobile devices. May 2015 saw the launch of Go by OSN, a standalone OTT ‘skinny’ bundle. The service, available via fixed line, WiFi, 3G and 4G networks, does not require a full subscription to OSN but instead costs US$10 a month – way below the US$100 monthly cost of its Platinum satellite delivered package.

In 2014 beIN Sports relaunched its OTT service, beIN Sports Connect, and now sells smartphone and tablet subscriptions on a daily, monthly or annual basis, as well as offering its satellite subscribers free desktop access to its channels. These and other OTT services have recently been joined by Starz Play Arabia, which was introduced, softly, in April 2015. It is the first international foray for the US cable company Starz – creator of titles such as Black Sails, Power, Spartacus – and is streaming Hollywood content on-demand to consumers for US$13.99 a month. Maaz Sheikh, chief executive, Starz Play International, says the reasons the company opted for MENA is down to the potential size of the broadband market, the pay TV landscape, and finally, the current OTT landscape. “The broadband market – both fixed and mobile – is extremely attractive. There are about 14 million fixed broadband users in MENA, a figure set to grow to 20 million by 2020. But mobile broadband is where the market is even more attractive: there are 25 million 3G and 4G customers now, and by some estimates this base will grow to 75 million by 2020,” says Maaz Sheikh. “Although 80% of the broadband market is currently in the Gulf Cooperation Council [GCC] countries, and as a percentage of overall households across MENA broadband penetration is quite low, particularly in North Africa – from our perspective that just means there is more to come,” he says.

MBC’s The Voice (opposite left) highlights the appeal of local content; Starz Play (right) is betting on the appeal of SVoD.

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Middle East & Africa 2015 > Focus on MENA

Maaz Sheikh accepts his former employer OSN remains the dominant provider of subscription entertainment in the region. However its satellite services are, he says “not at a price point that the masses can afford.” This, combined with studios looking for a diversification in the way their content is distributed to reach more viewers, provides an opening for Starz Play Arabia. The subscription video-on-demand (SVoD) operator’s strategy is to provide premium movies and series at the time of broadcast in their country of origin, be that the US with content from CBS, Showtime, Starz, or Sony, or from the UK – as it has recently done with the Channel 4 series Humans and ITV’s Broadchurch. Current series will be shown exclusively on the platform. In addition, Starz Play Arabia aims to launch Arabic shows by the first quarter of 2016. “We have to have content and programming that goes beyond Hollywood, and we’re looking at both acquiring content from local producers and developing our own,” says Maaz Sheikh. Although Netflix is yet to launch in MENA, Starz Play Arabia does face OTT competition from local players Istikana and icflix, which launched an offering of Arabic (‘Jazwood’), Bollywood and Hollywood content two years ago. “No one had done anything like this from the region and we did not know what to expect. We knew there was a demand… but once we launched we had to cross a lot of hurdles [including] localisation and monetisation of content,” says icflix’s CEO Carlos Tibi. “Although icflix had a fairly large library of content, we were not completely sure what people’s tastes were and what age groups would be interested. We had an idea that it would be the younger generation. Then when we launched we saw it was not just the younger crowd, but the older generation was also interested because of Jazwood [Arabic content].” Icflix has evolved its business model to offer pay-per-view (PPV) alongside subscription due to demand for the latest content straight after its cinematic release – and related issues of piracy. Advertising supported VoD (AVoD) is also now offered; where viewers can watch select Hollywood documentaries, select Bollywood titles and Arabic TV series for free. Other than icflix’s original Arabic productions, which include the films HIV and Al-Makida, and TV series Alf Leila we Leila (Arabian Nights), the content it carries

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is non-exclusive. “Because today in the digital era, as soon as movies are out they are pirated in high quality and become available across thousands of sites,” says Tibi. Over 60% of icflix’s subscriber base of 700,000 comes from the UAE, Morocco and Egypt. It is also popular in Saudi Arabia, Kuwait, Bahrain, Tunisia and Algeria, and the number of subscribers is growing 25% month-on-month, claims Tibi. While action, horror, drama and sci-fi are the most popular genres, language is key to different markets. “In the Middle East it’s Arabic and English language content. In North Africa a lot of French, Spanish and Arabic, while the Levant

Digital TV Europe November 2015

speaks mainly French and Arabic. So with each country we localise the content to that user’s preference,” says Tibi. Pricing is also adjusted for the North African market to make it an affordable alternative to piracy, and the platform’s technology can go as low as 256kbps where broadband speeds are not very high. Both these OTT operators are also working with local telecom operators to carry their video streaming services on IPTV platforms in Bahrain, Egypt, Jordan, Lebanon, Morocco, Oman, Qatar, Saudi Arabia and the UAE. “For us, partnering with telecommunications operators is important

Piracy: the perennial problem Content piracy remains a constant concern for purveyors of premium content in the Middle East and North Africa (MENA), be they pay TV operators or free-to-air broadcasters such as MBC. “In the satellite market there are around 75 pirates that steal content and broadcast it free-to-air to 35 million people, this is the most pernicious,” said Sam Barnett, CEO, MBC. “Then there is online piracy, which everyone is feeling globally, not just in the Middle East. OSN is making great strides in this area and we are working with authorities and Dish TV in the US to identify the pirate sites.” The figures are staggering. Just one operator being tracked by MBC had allegedly stolen US$20 million (e18 million) worth of content over two years, according to Barnett. It is this kind of activity that has led MBC and other leading broadcasters, content owners, satellite organisations, and legal bodies to create a regional Anti-Piracy Coalition to identify and tackle content theft and copyright infringements. “Trying to pursue a particular pirate channel through the courts, in a region comprising 22 regulatory entities, was challenging and not always helpful. The perpetrator may just be told by a court not to download a particular title, like Gladiator for example, rather than cease operations. The coalition allows us to work together, identify the culprits, notify the satellite distributors, and have them taken down from the satellite,” says Barnett. “Before the coalition there was a lack of clarity on which broadcasters were pirating and which

were legitimate. But to some extent we’ve got there now. Together, we’ve closed down 45 pirates and, of the nine different distributors

Barnett: pursuing pirates through the courts in a region with 22 regulatory entities is challenging.

or operators selling satellite capacity, eight of them have now stopped dealing with illegitimate companies.” STN, du, Gulfsat, Nilesat, JMC, Arabsat, Eutelsat and Viewsat have all been praised by MBC’s CEO for their efforts to remove pirate channels from regional satellites. On top of the threat from organised pirates, the coalition thinks around 50% of families coming from the Indian subcontinent into Gulf States are using illegal satellite receivers. OSN has most to lose here, having paid for exclusive rights to show premium South Asian content and cricket coverage in MENA. However, efforts to tackle the problem are resulting in police crackdowns, such as a recent raid in Dubai’s Muhaisnah area where illegal dishes were removed and notices issued informing residents they were in violation of the law. Inroads are certainly being made into tackling piracy in MENA, though all involved would agree there is some way to go to ensure content legitimacy on the region’s airwaves.

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21/10/2015 16:01

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21/10/2015 10:44

Middle East & Africa 2015 > Focus on MENA

Digital TV Europe November 2015

SVoD service icflix has forged links with a number of local telcos.

as it brings the brand tradeability and legitimacy that the consumer is looking for. Starz Play is still a new brand in the market,” says Maaz Sheikh. “It’s good for both parties strategically – we bring the telecom operator the content and they provide us with brand credibility and easy billing and sign on options for the subscriber.” Starz Play Arabia already has deals in Qatar, Oman, Kuwait, Tunisia and Algeria, with more likely to be announced soon. Meanwhile icflix has arrangements with seven operators, including three group agreements with Zain, Orange and Qatar’s Ooredoo, with further discussions underway. UAE telco du also offers both these VoD offerings as part of its wider duTV IPTV fixed and mobile service, which now reaches 10,000 subscribers. Du provides 950 TV channels, both premium and free-to-air, along with just under 3,000 video assets for its ondemand offer – though it expects this to rise to 6,000 video assets in 2016, says Samer Geissah, du’s vice president, consumer home and multimedia services. “In October 2014 we launched Du View, a multiscreen companion to the home IPTV service, free of charge to our existing subscribers,” says Geissah. “It offers around 2,000 video assets and 79 linear channels – though this will be pushed to 300 live TV channels by early 2016.” A new Du View app will be available in November, with personal bookmarking to help viewers find where they left off when binge viewing box sets, plus a dedicated area providing Dubai-based videos shot in 360 degrees. Du is also in talks with Hollywood studios to provide the same feature with some of their content. Plans are afoot to launch an OTT version of Du View, which anyone in the UAE will be able to use, not just du’s existing IPTV subscribers. Pay TV providers OSN, beIN Sports, Abu Dhabi Media Corporation’s Abu Dhabi Sports, icflix and Starz Play Arabia are all carried on du’s IPTV platform – something seen throughout the GCC states. “In the end it’s the subscribers’ choice whose platform they watch content on, and they will choose the best offer. Ours is a comprehensive HD content offering, truly multicultural, with live TV from the Middle East, Asia, Europe. We have a large library of relevant content – and

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enough packages and variety to serve many different nationalities,” says Geissah. As TV generates just 5% of overall revenues for the GCC telecommunications operators, they view the provision of pay TV via IPTV as an add-on, not as full competition for satellite subscription services, says IHS’s Papavassilopoulos. “They are not seeking rights or their own productions as BT are doing in the UK, for example.”

OTT: gaining ground OTT is gaining ground in the region, but still represents just 2% of the MENA’s overall pay TV revenues. “We’re still in the education phase of OTT in the Middle East and North Africa, with Netflix’s launch not yet imminent in the region,” says Papavassilopoulos. “OSN, BeIN Sports and free-to-air broadcaster MBC – with its AVoD and new SVoD OTT service – are dominant in the OTT field and will remain so for the foreseeable future. Local services icflix and Istikana have a niche audience but are not challenging the dominant players, and Starz Play Arabia will need two years to make traction,” forecasts Papavassilopoulos. An undeterred Maaz Sheikh says Starz Play is aiming for a 20-30% share of the OTT market by 2020 “given we have an early start”, though estimates of what that market will eventually be worth vary considerably. At the high end, A.T. Kearney suggests the MENA OTT market could reach US$1 billion by the end of the decade, though more conservative estimates suggest the US$500US$600 million mark.

What is certain is that all of the region’s pay TV operators, however they deliver their content, have much to contend with from the heavyweight free-to-air players. Subscriptionbased services reach between two and five million homes, while MENA’s most popular satellite broadcaster MBC beams into 50 million homes daily (or 90-100 million when reaching the climax of its most popular shows such as Arab Idol or The Voice Middle East). “I don’t think MBC can fear any intruder in the region. The amount of investment in production, infrastructure, and local content is significant to their success, and they know their audience,” says Papavassilopoulos. “Around 52-54% of total advertising revenues in the region go to MBC.” The majority of the Dubai-based broadcaster’s content remains free-toair. However, it has recently entered the subscription TV business with its MBC+ payTV channel and nascent OTT SVoD service Shahid+. Shahid+ is a subscription version of its seven-year old AVoD sibling Shahid, and is available across the globe with the exception of the US. MBC’s presence online is as enviable as its satellite reach – the company claims it attracted 17 million unique users this year in the month of Ramadan, a 30% increase on 2014. Ultimately it seems MENA will continue to be dominated by free-to-air broadcasters. Although there remains growth potential, investment opportunity and technological innovation in the pay TV sector – with the proviso that piracy is curbed, investment in local content continues, and the implementation of broadband infrastructure remains on an upward trajectory. l

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21/10/2015 16:01

Q&A: Geir Bjørndal, Verimatrix Geir Bjørndal, VP, international strategy, Middle East and Africa at Verimatrix, talks about content security requirements in MEA. What particular challenges are associated with content and revenue security in the Middle East and Africa? What trends are discernible? The Middle East and Africa are two very different markets with different challenges. The Middle East is a very developed market where one of the main concerns is redistribution of premium content.  Therefore the priorities are to not only to protect the content, but also the ability to trace content in the event premium content has been redistributed over the internet.  In particular, beIN Sports, the largest sport content rights holder in the region, requires watermarking in order to broadcast their content. Major operators that want to deliver UHD content are also focused on meeting these more stringent security requirements. On the other hand, the majority of countries in Africa are still switching from analogue to digital as the main source of television.  Many countries start with free-to-air TV where security is not really essential. With the digital switchover, operators are tempted to go with free-to-air set-tops that feature very basic security systems.  Verimatrix is helping digital TV operators understand that the benefits of a security solution go beyond gaining access to content to providing a platform to capture and secure revenue – an investment in the inevitable future of pay TV. What do pay TV service providers need to put in place to overcome these challenges and threats? In both markets, pay TV providers need to select a security partner that can support the future development of their networks. Irrespective of the model used, these operators will need a simple, cost-effective and futureproof security solution that will enable security on all types of video content across all types of distribution networks and to all types of receive devices, such as the solution provided by Verimatrix. A key component in this approach is for operators to embrace technology vendors that have experience in successfully deploying technology components in other parts of the world and creating partnerships. Tapping into this knowledge and experience and establishing long-term relationships rather than simply selecting technology on an ad hoc or price-first basis is a logical way forward. Can security for one-way networks be made to match what is possible on two-way networks? What other tools are available to secure content and revenue streams on these networks? Security on one-way networks has to be just as advanced as security on two-way networks since it is more challenging to monitor different devices on one-way networks.  The development of what we call cardless security, which leverages silicon anchors available on a system on a chip (SoC) that powers a set-top box or consumer device, has been extensive over the last years. In fact, Verimatrix has announced Advanced Security certification with several SoC partners. This approach is increasingly popular, particularly in emerging regions,

as it offers equivalent security to traditional smartcards, but at a lower cost. Furthermore, cardless security solutions are largely implemented in software, which is flexible and can be securely upgraded over time as business and threat models change. It should also be noted that hybrid networks are becoming the norm. For example, Wananchi has launched two core Zuku services; one is for the basic pay TV market, which is attracting more of the population from free to basic, affordable pay TV services. The other is its cable service, which is most typically used for OTT streaming. How far can digital watermarking help secure content in emerging markets and how much demand is there for this? The demand for watermarking is typically an indicator of market maturation. Because the Middle East market is more developed, in terms of things like infrastructure, regulatory framework and available income for entertainment, the threat models are different. As mentioned, redistribution is the fastest-growing threat in the Middle East so watermarking is becoming an imperative. As the African market develops, it will also create a need for watermarking. In fact, currently we are seeing mobile networks as targets for piracy, where watermarking can be effective as they can carry large amounts of data. Of course no single technology can defeat or prevent all types of threats, and watermarking is just of the multi-layered security techniques operators can implement to delay piracy and allow additional time for revenue generation. How far will Verimatrix’s concept of globally interconnected pay TV revenue security be able to play a role in emerging markets in the future? The benefits of a cloud-based revenue security platform are appealing to both mature and emerging markets. Transitioning from a highly controlled and closed environment to a globally interconnected security infrastructure presents opportunities for OPEX reduction, more proactive threat management and greater visibility to optimize system performance – as well as simplifying the realities of a complex, multi-network, multidevice, multi-DRM environment. Without a doubt pay TV is becoming more connected. And greater connectivity brings the promise of more engaging services, but also potentially paints a much larger target for would-be pirates. To address these issues, it only makes sense for operators to have their revenue security platform connected as well. Our Verspective™ Intelligence Center takes advantage of the inherent benefits of a cloud-based system and extends the value proposition for the Verimatrix Video Content Authority System (VCAS™) architecture and ViewRight® device security offerings. Visit Verimatrix at TV Connect Africa 2015 at booth #5.

Middle East & Africa 2015 > Africa and its growth prospects

Digital TV Europe November 2015

41,000

3,000

12,520,000

76,000

41,950

Sudan

3,435,550

Egypt yp

2,000 205,000 205,0

Libya ibya

2,064,027

1,131,998

472,176

4,000,000

Tunisia

739,640 7,186,000

Nigeria

1,950 1,686,500 1,68 86 6,500

Algeria geria 138,616 83 83,000

Ghana

6,284,760 53,600 1,068,000

Morocco

5,000 9,010

Mauritania 100,000 102,000

Senegal

12 p12-13 Africa Map MEA15.indd 38

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21/10/2015 16:35

Middle East & Africa 2015 > Africa and its growth prospects

Digital TV Europe November 2015

0

a

109,000

165 5

166,200

Seychelles eych ycch cchelles h ess

72,000

Mauritius uritiuss

209,200

60,500

69,000 0

14,000

183,500

156,160

22,000

75,500

Kenya enya

20,000

TTanzania anz nz

113,500

Mozambique M Malawi

123,670

71,000

68,000 0

Uganda

154,460

Rwanda

Zimbabwe

3,161 44,882

126,500

19,167

34,500

Zambia

72,000 72,00 00 23,000 2 000 23

Botswana wanaa 69,000

82,000

305,000

19,000

44,200

41,000

Angola

5,807,498 1,414,600

South Africa

Namibia Cable

998

000

17,950

DTH

Africa: the big picture DTT

IPTV

Broadband

Source: Ovum/WBIS

12,570 18,520

Cabo abo o Verde

DTH satellite still dominates the pay TV scene in Africa, though DTT is beginning to show a strong presence in key markets like Nigeria as the continent moves towards digital switchover.

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p12-13 Africa Map MEA15.indd 39

13 21/10/2015 16:35

Middle East & Africa 2015 > Africa and its growth prospects

Digital TV Europe November 2015

Africa: the big picture Africa represents a huge opportunity for pay TV operators, but the outlook varies from country to country.

Africa

presents one of the world’s largest growth opportunities for pay TV. However, with analogue-to-digital switchover still incomplete across much of this vast continent, the regional picture is still complex with different countries at different stages of development. According to a recent report by Digital TV Research, pan-African pay TV is “set to boom” in the coming years. Digital-terrestrial pay platform GOtv is expected to more than quadruple its 2014 subscriber total by 2020, gaining 5.84 million customers to reach 7.5 million. Rival StarTimes is tipped to see similar growth, expanding its base by 4.39 million to reach 6.13 million in 2020. GOtv’s sister operator, pan-African satellite service DStv, is also poised for growth, and will expand its subscriber base by 56%, from 7.74 million in 2014 to 12.06 million in 2020, according to the report. Digital TV Research estimates that in 2020, DStv will be the second largest operator by subscriber numbers in the Eastern Europe, Middle East and African region, behind only Russia’s Tricolor. These predictions highlight the fact that pay TV penetration is still very low in much of Africa, with the majority still accessing analogue TV signals. Digital switchover could fuel pay TV uptake in the years to come. June 17 of this year was the official deadline for switchover from analogue to digital TV broadcasting in the UHF band in Africa, Europe, the Middle East and Central Asia – as set by member states of the ITU at the Regional Radiocommunication Conference in 2006. According to the latest ITU information, in Africa only Malawi, Mozambique, Rwanda and Tanzania have completed switchover. The process is ‘ongoing’ in a large number of countries, including Nigeria, Ethiopia, Zambia Uganda, the Democratic Republic of Congo and Angola. According to the ITU, in South Africa, Eritrea, Liberia, Libya, the Central African Republic and the Comoros Islands the process has not yet started. Earlier this year South Africa’s department

14 p14 Africa focus MEA15v4st.indd 14

of communications said that the issue of whether to include an encryption system in set-top boxes as part of digital switchover had “impacted negatively” on the country’s ability to meet the deadline. However, in April, the communications department reportedly outlined plans for an 18-month migration that will see DTT cover 84% of the country, with the remaining 16% to be covered by satellite. In pay TV, MultiChoice has been the dominant force in the South African market since it launched there, though newer entrant StarTimes now also has a presence. The neighbouring southern African countries of Botswana, Mozambique, and Namibia had a combined total of 1.1 million TV households at the end of 2014, according to Ovum statistics. Of these, 453,000 households – some 41% – took out pay TV subscriptions with South Africa’s MultiChoice and Zap TV, a service operated by Portuguese operator Zon, accounting for a combined market share of 82%. Cable TV provided by TV Cabo is available in Mozambique and had 55,000 subscribers by the end of 2014 – accounting for 31% of the country’s pay TV market.

DTT challenges Continent-wide, East Africa leads the way in terms of digital switchover, having settled on DVB-T2 as the preferred transmission standard. However, DTT uptake has been hindered by high set-top costs, with these often unaffordable for a mass-market audience. Ovum forecasts that East Africa will have roughly 7.7 million TV homes by the end of 2019, with the number of pay TV households due to grow to 1.9 million to account for 24% of the total. Total pay TV revenue will increase 68% from US$240 million (e212 million) in 2015 to US$402 million in 2019, driven by an increase in subscription revenue and more households taking pay TV. In Francophone Africa – across countries like Cameroon, the Democratic Republic of Congo, Republic

of Congo, Côte d’Ivoire, and Senegal – the growth rate of the pay TV user base is tipped to exceed 100% between 2014 and 2019 in most key markets. The Democratic Republic of Congo alone will see its pay TV market increase six-fold to pass the one million mark in 2019, according to Ovum forecasts. Currently in this region, Côte d’Ivoire is the largest overall TV market with 3.7 million households equipped with at least one TV set at the end of 2014. Elsewhere, South African telco MTN acquired a licence to provide digital-terrestrial pay TV services in Nigeria in September, paying NGN34 billion (€149 million) to the Nigerian National Broadcasting Commission (NBC) for the licence. This will enable the operator to provide pay TV services over the country’s DTT network. The move comes after NBC admitted in June that it would not meet the ITU’s original switchover deadline and agreed a new date of June 20, 2017 in coordination with neighbouring states. Meanwhile, Ghana’s ministry of communications signed a US$82.3 million contract with K-Net Limited for the rollout of the country’s digital terrestrial television (DTT) network in July. The contract was for the supply and installation of a DVB-T2 terrestrial network over the course of a year – nine months for rollout and three for trouble-shooting and resolving any issues. After deployment, analogue and digital transmissions are due to run concurrently for a year before the switch-off of the analogue transmitters. Currently Ghana’s pay TV market is dominated by satellite services from Multichoice-owned DStv and MyTV Africa, a subsidiary of Dubai-based Strong Technologies. However, pay TV penetration is low. According to Ovum, pay TV homes represented just 7% of the country’s 2.7 million TV households. While total TV penetration is tipped to reach 70% or 3.5 million homes by the end of 2019, the proportion of households that will subscribe to pay TV is expected to remain steady at 7%. l

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21/10/2015 16:31

p15 TV Connect Africa MEA15.indd 1

20/10/2015 15:49

Middle East & Africa 2015 > Interview: Michael Dearham, StarTimes

Digital TV Europe November 2015

Star performance

StarTimes media executive Michael Dearham tells DTVE’s Andy McDonald about the China-based company’s ambitious African expansion efforts.

Since

making its first steps into Africa in 2007, China’s StarTimes has made a major mark on the continent’s digital TV landscape, now claiming more than five million DTT and DTH subscribers across 16 countries. However, with content localisation efforts underway, technological innovations – including mobile and multi-room viewing – coming through, and more markets to grow and expand its footprint into, the company’s

16 p16-17 Startimes MEA15v4am.indd 16

media strategy is still evolving. Describing the vision of the company, Michael Dearham, media division vice-president of StarTimes, says that first and foremost “it’s about positioning” – specifically, delivering compelling content and offering it at an affordable price. Dearham says that StarTimes’ content strategy is based around “three pillars”: exclusive sports rights; high production-value Chinese content dubbed into local languages;

and different types of indigenous-language content in languages like Swahili, Luganda and Yoruba. He claims these are key to setting StarTimes apart from its competition – namely Africa’s dominant pay TV provider, Multichoice. “We’ve only been in Africa for seven or so years now. During this time this strategy has evolved, it’s grown, it’s refined to the point now where for instance we have got five sports channels and a year ago none existed. Now

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21/10/2015 16:07

Digital TV Europe November 2015

StarTimes’ media division vice-president Michael Dearham.

we have got numerous indigenous language channels – up to 10 or more,” says Dearham. In terms of sports rights, StarTimes scored a major goal earlier this year when it agreed a five-year deal to air German Bundesliga and a three-year deal to air Italian Serie A football exclusively to subscribers across Africa, including in its largest two markets, Nigeria and Rwanda. Currently MultiChoice has the African rights to English Premier League football, which it airs via its DStv platform. Meanwhile, Dearham says that tapping into Chinese content and dubbing channels from StarTimes’ home market is attractive to African audiences as the narrative style of Chinese movies and drama series are similar to African story-telling techniques. When it comes to localisation, Dearham says this is the next step in StarTimes’ “conetnt-building, multi-channel strategy.” Over the next year and a half the firm plans to

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p16-17 Startimes MEA15v4am.indd 17

Middle East & Africa 2015 > Interview: Michael Dearham, StarTimes

build a new Kenyan HQ in the Nairobi suburb of Karen. This will house production studios, employ local talent and provide a location for StarTimes to dub content. Though StarTimes already has offices in 16 countries, Dearham says the company now aims to improve local production capacity – first in Kenya with plans also afoot for Lagos, Nigeria. The firm currently has production studios and playout facilities in Beijing, though Dearham says “we’re going to immerse it locally”. Alongside a strong content proposition, Dearham says that StarTimes’ aim is to ensure its pay TV offering is affordable and “address millions” of people that don’t have access to digital TV. In Nigeria, for example, StarTimes’ entry-level Nova bouquet, which consists of some 29 channels, costs just NGN600 (€2.65) per-month. Dearham says that StarTimes’ vision is “to enable every African to enjoy digital television entertainment.” He talks of “levelling the playing field” and enabling everyone, not just an elite few, to access quality TV entertainment. This is something that the company is also keen to communicate as part of its marketing efforts, with StarTimes adopting what Dearham describes as “communitydriven approaches” to communicating with the public. “In South Africa, for instance, we have got seven customer experience centres. These customer experience centres are hubs, embedded in the community,” he says. “It’s bringing a formerly elite and exclusive experience down to the ordinary man.

Third development phase StarTimes’ positioning as an African media contender has been part of a gradual shift from its origins as a technology provider. Initially producing decoders, mobile phones, TV sets and digital projectors, StarTimes moved on to become a system integrator and platform operator. “Now we’re moving to phase three in development, which is becoming a media operation of note,” says Dearham. To help take the company to the next level, StarTimes has been working on a number of developments – including its recentlylaunched Tenbre Play app. This acts as a personalised TV guide that lets StarTimes subscribers follow their favourite programmes, set reminders and chat. However, the app’s

biggest draw is that it lets users watch video – including live football – from their mobile phones. Available for Android, with iOS to follow, the app aims to let users access content without using lots of data. “It’s supported by Chinese technology – it compresses the video image without sacrificing quality,” says Dearham. “We’re introducing it now in all of our country branches, promoting it heavily on our channels.” Another new development currently underway at StarTimes is a new multiroom, media gateway that it is working on with content security firm Conax. The new wholehome solution will make it easier to share live TV and DVR within the home, without needing an internet connection, according to the two companies. “It is part of a platform innovation that allows you to access whatever image, whatever text, whatever audio [or] video through a gateway,” says Dearham. “It’s in the research and development stage now and will soon be introduced in Africa and beyond.” Alongside these developments, Dearham says that phase three of its media plan includes consolidating its DTT base while challenging its larger rival MultiChoice in the DTH space. “Leadership positioning in DTT, challenger position in DTH,” as he puts it. On the digital-terrestrial side, StarTimes aims to have a “geographical proliferation of DTT transponders” across its footprint, and to roll out to countries such as Camaroon and Madagascar, says Dearham. On the DTH side, the firm also has growth plans. One key market it is focused on is South Africa, following StarTimes’ takeover of failing pay TV operator TopTV there in 2013. “We are busy in the process of bringing this out of business rescue and of course towards recovery,” says Dearham, who was recently appointed CEO of StarTimes’ South African office, alongside his other duties. He says StarTimes has a three-year plan for South Africa and that it is “determined to make a difference and provide content diversity within the South African media and television sector”. Beyond this, Dearham says StarTimes has ambitions to expand its DTH business across Africa, with a particular focus on countries including Zambia, Malawai and Zimbabwe. “DTH is very much key to our growth strategy,” he claims. “[We plan] to consolidate our position as leader on DTT and to ensure that our DTH business reaches critical mass.” l

17 21/10/2015 16:08

Middle East & Africa 2015 > Interview: Addy Awofisayo, Consat

Digital TV Europe November 2015

Consat’s Nigerian journey Consat’s Addy Awofisayo discusses the DTH operator’s growth to date and its future plans in its competitive home market of Nigeria with Andy McDonald.

Continental

Satellite Limited (Consat) was established in 2012 with a mission to provide an affordable and dependable pay TV service to all Nigerians. The Lagos-headquartered, digital satellite television company  offers direct-to-home (DTH) entertainment packages that director of content, Addy Awofisayo, says are aimed specifically at the country’s lower- and middleincome earners.

Consat offers two pay packages aimed at Nigeria’s lower and middle-income earners.

Awofisayo says that since going live over a year ago, Consat has seen “considerable uptake” of its service – even without a “big bang” marketing campaign. Although Awofisayo won’t reveal specific numbers, she says it has “definitely been a little bit more than we anticipated” in a challenging market. “When we started we were very conservative in terms of our subscriber numbers. Even though people say ‘it’s the Nigerian market, it’s big’, it is also very competitive. When you talk about the market that we’re targeting, which is the lower-income, middle-income class, disposable income is not readily available,” says Awofisayo. While Consat is targeting a similar customer-base to MultiChoice’s low-cost GOtv service and StarTimes’ Nigerian offering, Awofisayo claims that it has a coverage advantage over digital-terrestrial pay TV rivals. “DTT can only reach certain places. But being DTH we can target pretty much every nook and corner of Nigeria – every

18 p18 Consat interview MEA15v4st 2.indd 18

village, every town, every city. So we feel like we have something to offer that DTT players don’t have,” she says. Consat offers two main bouquets of content – its Style Package, priced at NGN999 (€4.40) per month, and its Classic package, which costs NGN3,999 (€17.70) per month. The Style package has 33 channels including Viacom-owned entertainment network Colors I n t e r n a t i o n a l , Nollywood network TVC Nolly, Hausalanguage channel TVC Hausa and MTV India. The Classic package has roughly 55 channels, including international networks MSNBC, Fox Entertainment, Fashion One, FilmBox and Fox Sports. Consat also offers a free-to-view option, with 17 channels including news networks TVC News, France 24 and Al Jazeera, along with the likes of TVC Entertainment and family entertainment channel Royal Roots TV. Viewers who have a Consat set-top box and pay a quarterly administrative fee can access these channels without paying a monthly charge. Awofisayo does not see Multichoice-owned DStv as a direct competitor “because we are not playing in the same field”. DStv’s packages range in price from NGN6,000 per-month for its Compact package to NGN13,980 for its Premium pack. However, one major draw that DStv has is access to sports, including English Premier League football. StarTimes, which offers both pay DTH and DTT services in Nigeria, also now offers more sport options to Nigerian viewers after securing a five-year deal to broadcast German Bundesliga football and a three-year deal for Italian Serie A football earlier this year. The operator has two new add-on bouquets – Sports Play and Sports Plus – specially designed for sport enthusiasts on the basic and classic packages on its DTT offering and

on the smart package for its DTH offer. “I know sports, especially the English Premier League is very big in Nigeria. However, I don’t think sports is the only offering that you can give to customers,” says Awofisayo, adding that Consat viewers can still access baseball and rugby, as well as French and Belgian football through the sports channels it does carry – namely Fox Sports and Fox Sports 2. “I think women and kids are really the big consumers of TV in Nigeria, and even probably across other countries too… As long as you have strong offerings in those [areas] and you make sure that those people are well taken care of in your channel offering, I think you’ll be fine.” Awofisayo believes that Nigeria’s move to digital broadcasting will present opportunities for Consat. Earlier this year Nigeria missed its ITU-mandated, June 17 date for analogue to digital switchover, with the Nigerian National Broadcasting Commission  agreeing a new deadline of June 20 2017 in coordination with neighbouring states. When switch-off does come, Awofisayo says “everyone has to have a box in order to watch TV”, putting Consat in a good position to be the chosen provider of “a considerable amount” of the millions of households that will need to make the switch. Looking ahead, Awofisayo says that, as a DTH service, Consat has the option of moving into neighbouring markets – though its focus is firmly on Nigeria for the time being. “Our footprint covers West, East, Central and Madagascar. We could expand, but I think because Nigeria’s such a big market we definitely want to get that right. It probably will take us two or three years to make sure that we really have our hold on Nigeria.” In terms of strategy for next year, she says that provided Consat has a strong offering in kids’, women’s and lifestyle channels, “we’re going to be able to keep our subscriber base and even grow it. That’s really our focus: how can we get people connected to our boxes. Our free-to-view offer is another strategy that we hope will get customers connected to us.” l

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21/10/2015 15:43

2016 ANNUAL INDUSTRY SURVEY The inaugural Digital TV Europe Industry Survey will provide invaluable insight and comprehensive analysis of the state of the industry through the key topics addressed in the survey. The Digital TV Europe team will turn the raw data from the survey into a series of reports and features that will be made available to our unrivalled community of industry professionals including key pay tv operators, broadcasters, content owners and technology providers. > Promoted through a series of direct emails to our unique 30,000 strong subscriber base > Promoted through DTVE Daily newsfeed > Promoted on Digitaltveurope.net > Promoted via Digital TV Europe social media groups including over 3,000 twitter followers and linkedIn members > Published in a special end of year print publication sent out to all our readers

SURVEY SECTION SPONSORSHIP With 6 sections available for exclusive sponsorship, the Digital TV Europe Annual Industry Survey provides you with a unique opportunity to:

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Topics covered will include: > UHD TV

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21/10/2015 15:46

Middle East & Africa 2015 > News feature

Digital TV Europe November 2015

Trace breaks new ground Youth-skewed media group Trace is ramping up its activities in Africa and beyond, taking its brand past its existing confines. CEO Olivier Laouchez spoke to Stuart Thomson about the company’s plans.

Youth

-oriented media group Trace has been focusing on expanding its footprint in Africa for some time now, but this year the company is accelerating the pace of development and expanding into new, hitherto unexplored areas. First, Trace is mulling the launch of a subscription VoD service for sub-Saharan Africa in the first quarter of 2016 and has hired Nathalie Morley, the former creative director of Fashion TV, to head this up. Trace Play, as the project has been dubbed,

Trace is developing a raft of other projects to expand its presence in Africa, including the launch of Trace Mobile in partnership with mobile operator Cell C. For this it is developing a streaming app with Universal Music that will include music, games and other content. “We are working with Universal to adapt music streaming to Africa,” says Laouchez, who adds that Trace has been working on this project for the last six months. The service will include the ability to download as well as stream content.

“Other music services do not have a significant penetration in Africa. We can [offer]...not just international content but local African content.” Olivier Laouchez, Trace

will include “a huge component of African content” with music, kids shows and series that will be available across French and English-speaking sub-Saharan Africa, as well as French-speaking countries in Europe, according to Trace CEO Olivier Laouchez. Trace also plans to develop scripted series and movies under the Trace Studios name. “We are going to invest in original production,” says Laouchez. The first projects are: Cote d’Ivoire-set series Pti Bisous, produced in partnership with local broadcaster RTI, Lagardère Entertainment-backed Diffa and Martica Productions; and movie Le Gang des Antillais, based on a true story about gangsters from the Caribbean island, starring Mathieu  Kassovitz  and Romane Bohringer. Trace has ambitions to develop more original productions, with former SABC executive Leo Manne, now Trace’s SVP in South Africa, charged with identifying projects. Laouchez says Trace will invest with partners in projects for which it could secure rights across both French and English-speaking markets.

20 p20 Trace MEA15v4am.indd 20

“Other music services do not have significant penetration in Africa. We can provide a service that offers adaptive streaming, but also the ability to download content as well – and not just international content but local African content,” he says. Apart from music streaming, Trace Mobile could include elements such as a loyalty programme, providing VIP access to concerts, movies and clubs. Trace is also launching a new music TV channel, Trace Gospel, available in English and French, which Laouchez says will be “a 100% gospel music channel”, with a broad appeal across countries including Nigeria and even predominantly Muslim countries such as Senegal. “We are actively discussing distribution deals,” he says, adding that the first platform deal for the channel will likely be announced in November. Trace is also considering launching Trace Gospel as a paid-for OTT app. Laouchez says that Trace remains wedded to the pay model. He points out that an advertising-supported distribution model requires scale, effectively

requiring terrestrial distribution. “Even for them it’s a challenge,” he says. Trace is also launching the third edition of its Trace Music Stars competition, where contestants record song entries by mobile with a chance to win a recording contract. The company has struck a sponsorship deal with South African mobile operator Airtel to support the event. This year’s edition will likely involve the country finalists being taken to Atlanta in the US for the final stage. The competition will kick off in November, with the final to take place in April or May next year.

Partnership model The final project in Trace’s current pipeline is the launch of Trace FM, a new radio station for Côte d’Ivoire, where the broadcaster has secured a national FM radio licence and a partnership with a local broadcast organisation. Laouchez says that Trace has an ambition to develop more radio services in other countries, for example in Cameroon, where it holds a local licence in Douala, the country’s largest city and economic hub. Laouchez says that Trace plans to expand its presence “on the ground” across a number of territories, providing its brand to affiliate entities through partnerships. Trace is also taking its African formats further afield, for example by launching Trace Music Stars in France’s overseas territories and departments. The group is targeting the African diaspora more widely and looking to countries where African culture has a significant foothold, including the US and Brazil. Trace has already launched a Portuguese-language channel in Africa – Trace Toca, distributed on the DStv platform – and the company plans to take this to other Lusophone markets. Broader ambitions aside, however, its existing core territories will remain at the heart of Trace’s expansion strategy. “France and Africa remain our priorities,” says Laouchez. l

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21/10/2015 15:38

#OTTTV15

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We Deliver the Best Experience in the Industry Intelsat connects your content to the largest number of viewers. Intelsat’s exclusive Video Neighborhoods place your content on the most in-demand satellites among top media and telecom providers. And, our next generation satellite platform will combine highthroughput spot beams for content regionalization and targeting, with our wide beam neighborhoods for mass audience coverage – that’s Intelsat EpicNG. Intelligent design developed specifically for your growth and your bottom line – you must agree, is an epic experience.

www.intelsat.com/DigitalTV

Envision. Connect. Transform.

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