The future of content

Entertainment provider: How OSN is dealing with an ever-changing TV industry

OSN CEO Martin Stewart reveals how the company is adapting in a hugely competitive marketplace
Entertainment provider: How OSN is dealing with an ever-changing TV industry
OSN CEO Martin Stewart is certain his company’s model can survive the industry’s challenges
By Pranav Vadehra
Mon 05 Feb 2018 10:03 PM

Sitting in the office of Martin Stewart, CEO of OSN, it would be easy to get distracted. There are four large television screens behind him, one showing snooker, one golf, while the other two are a mix of English and Arabic dramas.

There are certainly enough real-life dramas in the industry to distract Stewart, who has been in his current post for 18 months – the various forms of piracy, the prevalence of over-the-top (OTT) media services, the boundless popularity of digital content and the new viewer behaviour it encourages, versus the tried and tested linear format of traditional television.

Then there’s the arrival of local and international video subscription service players, alongside a busy free-to-air and pay TV marketplace.

Rival pay television platforms could be seen as a threat to the very existence of OSN’s multi-channel offering, but not for Stewart. Not yet, at least.

Global streaming giants Amazon and Netflix together accounted for just 21 percent of the Middle East and North Africa (MENA) market in 2017, according to a report from research and analysis firm IHS Markit, while the Dubai-based entertainment provider OSN has a rich history, an audience that likes to watch TV, and a clear roadmap for the future.

However, that’s not to say Netflix can’t be a part of that future.

Stewart says: “OSN has always been a leader in entertainment in the Middle East. It is the oldest entertainment provider in this region and our shareholders invented pay TV in this region. They have been at the forefront of every stage of the evolution of this industry and they will continue to be at the forefront as we move forward.

"Having said that, newcomers in the industry have forced us – and people like us – to make sure we listen to changing trends and behaviours. I think that whatever they produce is adding to the richness of the content that already exists.”

Indeed, he believes that their future relationship will be built on cooperation and collaboration rather than dog-eat-dog marketplace rivalry. “I strongly believe that partnerships are the way forward, not only in our region but I also think that’s something you’ll see on a global basis.

"But for us, specifically, given some of difficulties we have of operating over so many different countries, partnerships are really key in order to ensure that local providers are as successful as they can be.

OSN says content theft is having a catastrophic effect on the region’s entertainment industries

“We have a very good relationship with Netflix and I certainly think that working with them can be very beneficial to both our companies in the future,” he continues, adding that talks have already taken place between OSN and Netflix for some kind of deal in 2018.

However, OSN already has its own, well-developed plans. Video on demand is dominating the media and entertainment industry and this has prompted distributors to come up with different ways to bundle and disseminate content, create new revenue models, and open up all kinds of opportunities to push the envelope on content creation.

Steps were taken several years ago to haul OSN into the 21st Century, with the launch of OSN Play, where all the movies, HBO series, kids programmes, Arabic shows and live sports could be viewed on mobile phones, tablets and other devices. This has been followed up by the recent launch of Wavo – an online TV service powered by OSN with access to live TV channels, with no annual contract and the ability to come and go as you please.

Stewart explains: “Wavo is a unique proposition in the marketplace. It’s not just a Netflix-like company. It’s not just on-demand, we have linear channels as well, so you get the best of both worlds.”

OSN’s strategy closely mimics that of Sky in Europe, where it offers subscriptions based on content type, such as movies, TV entertainment and sports.

“The idea is that Wavo will target a new generation of people watching content... a new generation who may miss pay TV all together and go straight to get their TV online,” explains Max Signorelli, analyst, home entertainment, technology, media and telecom at IHS Markit.

With the Wavo rollout, OSN is staking its claim in an ever-changing marketplace. “Our response has been one of trying to adapt to the realities of the market we find today,” Stewart says.

“Everybody knows the statistics about the amazing demographic change in the region, with the percentage of millennials and the percentage of people who are under 15. All of those people are incredibly tech savvy, they’re very hungry to understand more about the outside world, but also to celebrate their own heritage and their own culture. Our response to the situation is to try and make sure we adapt our offering to their needs and their wants.”

A huge part of this is catering to the local population. Stewart almost bristles when asked if there is to be a greater focus on Arabic entertainment on the OSN platform. With 15 Arabic language channels, he says: “I know that there’s a perception that OSN is an expat service. It’s not. Our customer base is 65-70 percent Arabic speaking. Those are our customers and they want to hear stories being told in their own language. They want to hear stories that reflect their lives, experiences, societies, history and culture where they come from.”

OSN recently picked up groundbreaking show Qalb Al Adala (“Heart of Justice”), which is inspired by LA Law but based on real cases from the Abu Dhabi Judicial Department. Written by Emmy Award-winning US producer William Finkelstein in collaboration with a local team, it is produced by Image Nation Abu Dhabi in tandem with LA-based Parkes/MacDonald Productions.

OSN recently picked up Qalb Al Adala, or Justice, a legal drama series based on actual cases

“We’ve had great success with OSN Yahala and the other channels we put out as part of our Arabic offering. They do extremely well, they rate extremely well on our platform and we’ve been very pleased with what we’ve done,” he adds. “We’re going to do more [Arabic] because that’s where, I think, our audience wants us to go.”

With so much content available, offline and online, legal and illegal, it is important that entertainment providers such as OSN do not price themselves out of the market. Stewart believes the company has struck the right balance, although he concedes it is a constantly changing landscape.

He says: “We’re digitising our services, so we’re making sure customers can self-serve when they operate with OSN through our My OSN app which has been very successful. We have been working very hard with all the different payment gateways in the region to make sure that we provide as many different online and seamless ways for customers [to pay].

“And we’ve continued to adapt the line-up and look and feel of the channels to try and always refresh the offering to customers and we’ve changed the pricing and packaging to make it more accessible.

“We tried to broaden the range of price points so customers can get access to our great range of content.

“That’s been successful and given us good positive growth in DTH (direct to home) and cable and we’re very excited about what the OTT service can bring us this year.”

Paying their way

Piracy is costing the MENA region’s entertainment industry $500m a year

OSN CEO Martin Stewart reveals piracy remains the number one threat to the entertainment industry.

Despite some successes. he concedes the crime, which costs the industry in the MENA region over $500m each year, is still a long way from being completely eradicated.

“In terms of trying to combat digital piracy, we’ve removed nearly 240,000 links for pirated content online,” Stewart says. “We’ve conducted 200 raids across the region, confiscating thousands of boxes and illegal cards and that’s an ongoing battle, not one you can ever step back from because as soon as we remove those links, more links come.”

Working hand-in-hand with the enforcement agencies, OSN is also heavily involved in educating people about the perils of piracy.  The company, which is an active member of the Broadcast Satellite Anti-Piracy Coalition, organised a conference in Beirut in November last year called “Together Against Piracy”, where Lebanese Prime Minister Saad Hariri spoke. It was attended by representatives from the entertainment industry, judiciary, police, telecoms and cinema, as well as content creators, actors and musicians.

“It was terrific to see all of the different constituencies come together and say, ‘we need to solve this.’ This is too important to us from an economic point of view not to take any action,” Stewart says.

Start early

OSN is also reaching out to children to educate them about piracy. They launched an anti-piracy video game, Copycat Combat, aimed at younger children, and is a world first. In the game, children are encouraged to stop pirates from stealing their favourite content.

Stewart explains: “It’s just a way of helping them understand the impact of pirate activity on the entertainment they love. If they fail to protect the content then the message comes up that there are 50 films less this week on OSN because the pirates have stolen them.”

There is also an initiative, under the banner of Kiwa Slam, which encourages kids to create content and forces them to think how they would feel if someone stole their work.

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