The OTT media market in the Middle East and North Africa: emerging players and operator strategies

Research Report

The OTT media market in the Middle East and North

Africa: emerging players and operator strategies
August 2013
Karim Yaici

Analysys Mason Limited 2013

The OTT media market in the Middle East and North Africa: emerging players and operator strategies

Contents
Slide no.

Slide no.

5.

About this report

6.

Executive summary

20. Market context: the challenge of piracy is significant in MENA, which

hampers monetisation of OTT content

7.

Operators must position themselves to capture the growing OTT media

opportunity as smartphone and broadband adoption grow in MENA

8.

The absence of international players, and changing consumption trends,

are favouring the emergence of local OTT media players in MENA

9.

Recommendations

10. Recommendations for mobile operators considering the launch of an

OTT music offering

11. Recommendations for fixed operators considering the launch of an OTT

video offering
12. Recommendations for OTT content and media players
13. OTT media market overview and value chain
14. The focus of the OTT video market has shifted from the PC to the TV in
developed markets, and this trend has only started to emerge in MENA
15. Strategic approaches to OTT: operators should use their core capabilities
to determine how to position themselves in the OTT media market
16. MENA operators have limited OTT offerings, but regional start-ups offer
alternative media consumption experiences online and via mobile devices
17. OTT video could substitute for pay-TV services, which have been
dominated by satellite broadcasters and, to lesser extent, IPTV providers
18. In MENAs mobile music market, partnerships with OTT players can
strengthen operator positioning and offer alternatives to illegal downloads
19. Market context: so far, local players have been more successful in
capturing the OTT opportunity than international OTT players

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21. OTT video services and strategies in MENA

22. Mobile is a key driver for OTT video demand: our mobile Internet survey
found that more than 60% of respondents watched video on their
handset
23. Smartphones clearly drive video usage and OTT take-up: smartphone
users are far likelier than feature phone users to watch mobile video
daily
24. Operators can be enablers/distributors in the OTT video market, but must
prepare their infrastructure for the increased demands of these services
25. On the service supply side, the OTT video market is burgeoning in
MENA, but partnerships with operators or vendors are still rare
26. Emerging regional video OTT players are providing ad-supported content,
but players will need to adopt new monetisation models to sustain growth
27. Broadcasting and pay-TV companies in MENA are investing in the OTT
space, taking advantage of the absence of international OTT players
28. Fixed operators in MENA have launched multi-screen video services to
complement their broadband or IPTV service offerings
29. OTT video case studies: Etisalat (UAE) and STC (Saudi Arabia)
30. OTT video case studies: icflix (UAE)
31. OTT music services and strategies in MENA
32. Mobile is also a key driver of demand for OTT music: more than 40%
of mobile Internet users in our survey use music on their phones

The OTT media market in the Middle East and North Africa: emerging players and operator strategies

Contents
Slide no.

33. Despite the clear demand for mobile music in MENA, market players are
still working out how to monetise content in the face of widespread piracy

34. MENA has only a few examples of operator-run music portals and they
offer limited choice
35. Local OTT players are revitalising their music offerings by switching
from download to streaming services
36. OTT music case studies: Anghami (Lebanon)
37. OTT music case studies: Yala Music (various countries)
38. About the author and Analysys Mason

39. About the author

40. About Analysys Mason
41. Research from Analysys Mason
42. Consulting from Analysys Mason

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The OTT media market in the Middle East and North Africa: emerging players and operator strategies

List of figures
Figure 1: Major companies discussed in this report
Figure 2: Smartphones share of mobile handset connections, Middle East
and North Africa, 20092018
Figure 3: Fixed broadband connections, and DSL and fibres share of
connections, Middle East and North Africa, 20092018

Figure 4: Changing focus of the OTT video market

Figure 5: Operators core capabilities and their benefits to OTT players
Figure 6: Principal paths for video consumption in the Middle East and
North Africa
Figure 7: Channels to access full music tracks for consumers in the Middle
East and North Africa
Figure 8: Respondents who use video on their phones, Egypt, Saudi Arabia
and the UAE
Figure 9: Mobile video usage by content type, Egypt, Saudi Arabia and
the UAE
Figure 10: Reported use of video on mobile phones within the past
3 months, by handset type, Egypt, Saudi Arabia and the UAE

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Figure 11: Smartphones share of mobile handset connections, Middle East

and North Africa, 20092018
Figure 12: Fixed broadband connections, and DSL and fibres share of
connections, Middle East and North Africa, 20092018
Figure 13: Examples of OTT video streaming services, Middle East and
North Africa
Figure 14: Examples of OTT video services supported by media companies,
Middle East and North Africa
Figure 15: Operators multi-screen and OTT video offering in the Middle East
and North Africa
Figure 16: Respondents who use music on their phones, Egypt, Saudi
Arabia and the UAE
Figure 17: Reported use of music on mobile phones within the past
3 months, by handset type, Egypt, Saudi Arabia and the UAE
Figure 18: Examples of operators music streaming or download portals,
Middle East and North Africa
Figure 19: Examples of OTT music players, Middle East and North Africa

The OTT media market in the Middle East and North Africa: emerging players and operator strategies

About this report

This report analyses the key trends in, and drivers and
inhibitors of, the over-the-top (OTT) media market in the Middle
East and North Africa (MENA), focusing on two segments.

Figure 1: Major companies discussed in this report [Source: Analysys

Mason, 2013]
Market

Video services: These include video content distributed

over the operators infrastructure with an unmanaged
infrastructure (unlike IPTV). Content can be consumed on
mobile devices, desktop computers or TVs.

Bahrain
Egypt

Music services: These include digital music streaming and

download services. Most of the music consumed in the
region is pirated, but new companies have recently emerged
to provide legal music streaming and download services.

Active Digital Development,

LINKdotNET, TE Data

International

Google (YouTube), Netflix,

Dailymotion

Apple, Blogmusik (Deezer)

Jordan

d1g, iAraby, Istikana,

TootCorp

Umniah

Pan-Middle
East

Aljazeera Satellite Network,

icflix, MBC, Sky News
Arabia

Anghami , Hewlett-Packard
(HP), Music Master,
Ooredoo, UrFilez, Wataniya
Telecom, Yala Music

Saudi Arabia

STC

UAE

Abu Dhabi Media, EITC

(du), Etisalat, OSN

The report also provides recommendations for fixed and mobile

operators, and content players in the region. Figure 1 gives
an overview of some of the companies discussed.

Video

This report is based on several sources:

Analysys Masons internal research
interviews of stakeholders in the MENA market
our survey of 2000 feature phone and smartphone users
conducted between November 2012 and January 2013 in
Egypt, Saudi Arabia and UAE.1
1

Major companies discussed

For further details, see Mobile Internet Survey in the Middle East and Africa 2013: OTT
services and mobile money usage. Available at www.analysysmason.com/MIS-MEA-OTT.

Analysys Mason Limited 2013

Music
Batelco

Note: Case studies are provided for players highlighted in bold.

The OTT media market in the Middle East and North Africa: emerging players and operator strategies

15

Strategic approaches to OTT: operators should use their core capabilities

to determine how to position themselves in the OTT media market
Fixed and mobile operators have several assets that they could use in a partnership with an OTT media player. Operators could
decide to limit access to OTT media completely, but we believe that they should instead adopt a more-constructive approach
through partnerships with OTT players.

Operators could play a significant role in this emerging content market by offering a new distribution channel and facilities for
monetisation, such as integrated billing. They could also profit from OTT video by monetising the additional bandwidth that consumers
use, but should offer additional data capacity at a reasonable cost and avoid the temptation to impose excessive charges. At the same
time, OTT players would be able to provide fresh content to mobile subscribers, and create opportunities to improve the value of
operators data offerings through media bundling.
Figure 5: Operators core capabilities and their benefits to OTT players [Source: Analysys Mason, 2013]
Operator capability

Benefits to OTT players

Provide connectivity

Provides a distribution channel for their services.

Marketing and reach

Uses traditional sales and marketing channels to promote media content for example, by launching SMS
campaigns, placing advertisements in their application stores and positioning content at the top of their portals.

Billing relationship with customers

Facilitates payments for premium content via means such as integrated billing, in a region where a high proportion of
the population is unbanked.

Ability to control quality of experience

Operators have the ability to offer an enhanced user experience and enable end-to-end control of content
management, delivery and quality of service.

Analysys Mason Limited 2013

The OTT media market in the Middle East and North Africa: emerging players and operator strategies

Executive summary
Recommendations
OTT media market overview and value chain
OTT video services and strategies in MENA
OTT music services and strategies in MENA
About the author and Analysys Mason

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The OTT media market in the Middle East and North Africa: emerging players and operator strategies

39

About the author

Karim Yaici (Analyst) works on Analysys Masons The Middle East and Africa regional research programme. His
primary areas of specialisation include mobile operators VAS strategies in developing markets, and the adoption of
IP Multimedia Subsystem (IMS) services and mobile devices. Prior to joining Analysys Mason, Karim was an
associate analyst at Informa Telecoms & Media, where he authored reports on mobile accessories and mobile
applications. Prior to that, he worked as a research engineer in the Centre for Communication Systems Research
(CCSR) and Vodafone. Karim holds an MSc in Information Systems Management from the University of
Southampton and a PhD in humancomputer interaction from the University of Surrey.

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The OTT media market in the Middle East and North Africa: emerging players and operator strategies

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About Analysys Mason

Knowing whats going on is one thing. Understanding how to take advantage of events is quite another. Our ability to understand the
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knowledge of our people, is what sets Analysys Mason apart. We deliver our key services via two channels: consulting and research.

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The OTT media market in the Middle East and North Africa: emerging players and operator strategies

Research from Analysys Mason

We provide dedicated coverage of developments in the telecoms, media and technology (TMT) sectors,
through a range of research programmes that focus on different services and regions of the world.

Alongside our standardised suite of research programmes, our Custom Research team undertakes specialised, bespoke research
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To find out more, please visit www.analysysmason.com/research.
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The OTT media market in the Middle East and North Africa: emerging players and operator strategies

Consulting from Analysys Mason

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Our clients in the telecoms, media and technology (TMT)
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The OTT media market in the Middle East and North Africa: emerging players and operator strategies

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