Twofour54, Abu Dhabi’s government-backed media free zone, plans to be profitable by 2016, the company’s new CEO told Arabian Business in an interview.
“We can’t ignore the fact that we want media to be a commercially sustainable business,” said Noura Al Kaabi, the incoming CEO who takes over next month from Tony Orsten.
While Al Kaabi did not give numbers on how much the government has invested developing twofour54, it has been reported that by 2014 the free zone will have spent around US$3bn building studios, training facilities, and funding capital.
Al Kaabi said the Abu Dhabi government has not given her a blank cheque and the free zone will break even and be profitable in the coming years.
“We will reach a point where we will be able to fund ourselves. If we continue doing what we are doing, with the same plans, 2016 is a year when we can start giving back,” she forecast.
“The whole emphasis on this project from the start was to be sustainable. This isn’t speculative,” added Wayne Borg, deputy CEO and COO. “When you look at what we have achieved in terms of the number of companies that have set up here and production and people we have trained, we have created an export industry for Abu Dhabi. The proof in concept is there.”
Despite there being nearly 300m Arabic speakers, only around 1.5 to 2 percent of online content is in Arabic, therefore there is great potential growth for those in the sector, he adds.
Another report by the consultancy group Booz & Co stated that media revenues in the MENA region will surge from US$14.1bn in 2008 to US$26bn by 2013. Capturing a tiny sliver of that market would be a record haul for any media brand.
Therefore, it is no surprise that international brands have been attracted to Abu Dhabi, including the BBC, Bell Pottinger, Bloomberg, Cartoon Network Studios, CNN, Financial Times, Fleishman-Hillard, HarperCollins, JCDecaux, National Geographic Channel, Sky News Arabia and Thomson Reuters.
A new entrant into the free zone recently was EMM, which is to launch a 24-hour general entertainment TV and online network in Abu Dhabi. The new channel will produce 650 annual hours of original programming from twofour54 and the free-to-air channel is slated to go live by the end of 2012.
“EMM’s existing digital audience will be drawn to the original and exciting offering from the distinctive new TV channel when we transmit across the Middle East & North Africa. Editorially, operationally and technically our TV programming will be distinctive, innovative, empowering and with high production values,” said EMM’s CEO, Nicholas Claxton.
The new channel will be produced and broadcast from the twofour54 facilities in Abu Dhabi and will create a number of new jobs for the industry, initially with 20 technical and operational staff and as many as 30 creative production personnel. These numbers are expected to grow as output increases over the first five years.
Besides TV, the executives also want to tap into the gaming market, where big brand names are nearly as lucrative as movie franchises. Twofour54 ibtikar, the media zone’s investment arm, in August signed investment deals worth US$2.5m with two online gaming firms.
Twofour54 took minority stakes in Arabic online games companies Tahadi Games and Jawaker, in deals that are expected to create tens of new jobs for local youth. “We are creating meaningful jobs for young people in the UAE,” Borg said at the time. “We are looking about 50 jobs minimum realistically within the first eighteen months.”
Another area currently proving popular is the 3D format and this is an area twofour54 is already tapping into. “For us, we didn’t build a studio, we made sure to start with an academy, the Cartoon Network academy,” said Al Kaabi. “It is how we make sure it a property community and an ecosystem.
“We also have the first 3D studio lab, where we did produce a 3D content by Emiratis, written by an Emirati and written by a partner and we are very proud of it. It was done in the last two or three months,” she added.
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