Pay TV packages in the Arab world have an average cost of US$ 29 per month.

Private companies dominate the Arab Pay TV market, with ART, Orbit and Showtime competing for a share of the Arab world’s still relatively small pay TV market. The competition revolves around two main pillars: Channels and prices, and the three providers differentiate themselves by focusing on different types of content. The Arab Advisors Group believes that the heightened competition in the region as well as the emergence of numerous free-to-air (FTA) channels is leading to the adoption of new competitive strategies by pay TV providers.

When it was first introduced to the Arab world in the mid-1990s, pay TV was quite expensive. Subscription fees were around US$ 80 per month, and these were accompanied by high installation and insurance costs. At the time, free-to-air (FTA) satellite television was still relatively new with expensive equipment, and Arab audiences had few viewing options consisting mainly of local terrestrial channels.

During the past few years, all this has changed. FTA channels are exploding in the Arab world; during the past four months alone, 45 new FTA channels were introduced via Arabsat and Nilesat, bringing the total number of regional FTA channels to over 200. These channels depend on advertisements and interactive TV services - rather than subscription fees - to generate revenues and as a result provide a full variety of programs to viewers free of charge. These programs in some cases compete with the offerings of pay TV, and this is placing pressure on pay TV networks to enhance their competitive positions and add value to their services and content.

A new report, “Pay TV in the Arab World” was released to the Arab Advisors Group’s Media Strategic Research Service subscribers on December 4, 2005. This report can be purchased from the Arab Advisors Group for only US$ 950. The 35-page report, which has 26 detailed exhibits, provides a detailed analysis the services of ART, Orbit and Showtime along six dimensions: Channels, packages and prices, dealers, receiver technologies, interactive services and advertising rates. The report also includes an overview of local pay TV providers in the Arab world. Please contact the Arab Advisors Group to get a copy of the report’s Table of Contents.

“Pay TV providers are adopting a number of competitive strategies,” Ms. Nadine Usta, Arab Advisors Research Analyst wrote in the report. “These include promoting different types of exclusive content, lowering prices, eliminating installation costs and in some cases even including free decoders and satellite dishes in the deals. Long-term strategies also include diversification into other areas (such as providing broadband Internet via satellite) and vertical integration” Ms. Usta added.

Orbit is currently the largest shareholder in the recently launched private satellite platform Noorsat. Additionally, Orbit and Showtime have both moved into providing broadband Internet via satellite.

Alongside the three major operators, smaller local pay TV providers also exist in some Arab countries, and these tend to add to the available choices for viewers by providing channels in combinations of categories from more than one pay TV provider together with a selection of FTA channels.

The Arab Advisors Group’s team of analysts in the region has already produced over 480 reports on the Arab World’s communications and media markets. The reports can be purchased individually or received through an annual subscription to Arab Advisors Group’s (www.arabadvisors.com) Strategic Research Services (Media and Telecom). To date, Arab Advisors Group has served close to 330 global and regional companies by providing reliable research analysis and forecasts of Arab communications markets to these clients.