Hooray for Hollywood

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The arrival of the hugely popular Fox network on the Middle East's free-to-air TV comes as the region's entertainment industry is undergoing a transformation. Hollywood is heading East, with big US networks and studios staking their claim to affluent audiences and lucrative airwaves.

Showbusiness has been no business for most of the oil-fuelled economies of the Gulf, with imported Egyptian soap operas and paid-for international satellite channels providing most of the region's 200 million people and 38 million households with their entertainment.

That is about to change, however, as local audiences look forward to an entertainment revolution, sparked by the arrival of some of the biggest names in Hollywood bringing new channels and production facilities - and aiming to convert plentiful petrodollars into TV advertising revenues and movie box office receipts.

"The Gulf is on the cusp of an entertainment revolution," says Avi Bhojani, the Dubai-based CEO of BPG Group, a unit of WPP Group. "We are seeing an influx of new channels, as well as new studios opening up and big names like Warner and Universal coming to town."

Fox, the most-watched US television network, started broadcasting the first free-to-air branded Hollywood channels this month across the Middle East, in competition with the Dubai-based MBC group.

The arrival of News Corporation-owned Fox is set to shake up the regional broadcasting industry, which is also seeing a surge of investment in new production studios and even theme parks branded by the biggest names in movies, including Warner Bros and Universal.

"The Gulf is witnessing a rapid change in its entertainment industry," says Elie Khouri, regional MD of Omnicom Media Group. "Witness the growth of MBC through its new brands, the portfolio of channels at DMI and now Fox Movies.

A downturn in US and European TV advertising is also focusing attention on the region, as well as negatively impacting on advertising revenues in developed markets.

Middle East advertising figures continue to soar. According to a report by global media services agency ZenithOptimedia, forecasts show a decline in advertising growth in North America and Western Europe from 4.4% to 3.8% last year.

Meanwhile advertising spend in the Middle East is expected to grow by 54.2%, according to the agency. Advertising spend in the UAE has increased from US$869million in 2005 to US$1.3billion in 2007, the highest figure in the region, according to Spence Felix, exhibition manager for signage, imaging and media at ZenithOptimedia. He predicts the UAE will spend in excess of US$2billion by 2010.

Rising advertising revenues and a rapidly expanding population are already attracting attention from US networks such as Fox and studios including Warner Bros and Universal.

"There is enormous financial growth and very large international investments coming into the region," says Dawood Al Sheryan of MBC, currently the biggest player in terms of market share in the free-to-air TV broadcasting space here.

Earlier this year Fox International Channels brought the first free-to-air branded Hollywood channels to the Gulf, in partnership with Rotana Media Services.

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