The Arab advertising market is forecast to grow to a value of US$6 billion (Dh22.03bn) by 2015, bringing hope to a media industry hit hard by the disruptions of the Arab Spring and the global financial downturn.
Greater use of the internet and wider economic growth have been cited as driving a rebound in the regional media market, after advertising spending fell by more than 10 per cent in 2009 and last year.
That is a key finding of the Arab Media Outlook, a study published yesterday by the Dubai Press Club and Deloitte.
"Generally people are positive that the market is going to change," said Maryam bin Fahad, the executive director of the Dubai Press Club.
Total advertising spending in the Arab world should be worth $4.9bn this year and grow by 6.7 per cent annually to reach $5.95bn by 2016, the report found.
The Arab Spring disturbances contributed to an estimated 10.3 per cent decline in regional advertising spending last year, while the world financial downturn prompted a 12.1 per cent decline in 2009.
The Arab region has one of the world's lowest levels of advertising spending in relation to the size of its population.
Advertisers spent just $15.90 per person last year, compared with $54.40 spent per-capita in the Asia-Pacific region, $262 in Western Europe, and $466 in North America, according to the Arab Media Outlook.
Santino Saguto, a partner at Deloitte Middle East, said the report highlighted the growth opportunities in the local media industry.
Subscription levels for pay television are as low as 10 per cent in some countries - a figure that represents a significant growth opportunity for regional players such as OSN.
"It confirms that there is still some big growth potential for the advertising and pay-TV sectors in the region," said Mr Saguto. "Local revenues, as compared to the GDP or population, are well below what is happening in the rest of the world."
Future growth is also attributed to the rise of digital media, which is forecast to take a bigger share of the market, at the expense of newspapers and magazines.
Digital advertising is forecast to account for 10 per cent of the overall advertising market by 2015, compared with just 4 per cent last year.
Industry professionals confirm that online media are attracting more advertising spending.
Ahmed Nassef, the vice president and managing director of Yahoo Middle East, told The National that digital advertising was poised to grow by 15 to 20 per cent this year. "The Middle East region is the fastest-growing region globally in terms of internet … audience, as well as in terms of revenue growth," he said.
Other positive trends for the Arab media industry include investments by global players in the local market, said Mr Saguto. He pointed to Sky News Arabia, which is to start broadcasting from Abu Dhabi next week.
However, he said the relatively low value attributed to regional sporting rights, such as for Arab football tournaments, was a missed opportunity.
The Arab Media Outlook covered 17 countries in the region, and was based on 2,000 interviews. It was published ahead of the Arab Media Forum, which starts next Tuesday in Dubai. The report found that 65 per cent of industry professionals had a positive outlook for the media industry this year, compared with 17 per cent who were pessimistic and 19 per cent who were neutral.
Despite the harm to advertising revenue last year caused by the Arab Spring, the report found that the regional unrest would have a "positive long-term impact" on the industry.
Ms bin Fahad said the regional unrest had increased the public's trust in the media, which should benefit the industry in the long term.
"I think this is a positive thing that increased the level of transparency in the industry," she said.
According to the report, 79 per cent of a smaller sample of people surveyed said the Arab Spring had increased the freedom of the press, while 65 per cent said the quality of satellite TV news had improved.
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