May 2011

Arabic digital content in the GCC: Capitalizing on the growing opportunity

Intigral®

2Bringing audiences together with content creates economic value – recognized across commercial and social spheres

+

= economic value

Intigral®

3Digital distribution of content has changed the nature of the value chain, creating new opportunities and new challenges in our region…

Content Creation,

Adaption,

Acquisition

Billing,

Care &

Analytics

Network

(content

distribution)

User

Inter-

face

Content

Marketing

& Sales

Service

Design &

Delivery

Digital content value chain

New digital formats and technologies

New options for packaging content for interactive platforms

New ways to market and bundle content

New distribution networks

New user devices and experiences

Intigral®

Local content is king (Value Partners, 2010)

Media Lab

4The demand for Arabic digital content is high in the region, especially in the GCC…

Preference for Arabic content

Digital Arabic content players

High Smartphone penetration

One third of consumers in the Middle East will be looking to buy new smartphones in 2011

(Nielsen)

Google: 100 million Arab users will be online in 2015 (arabcrunch.com)

Internet access & Broadband penetration

Access to digital platforms

Queries in Arabic represent 54% of MENA queries, 70% of Egypt queries and 80% of Saudi queries (Google)

Intigral®

5

Source: PWC

The Middle East and GCC are not high focus markets for global OTT IPTV players…

Entertainment & media market by region (US$ billion)

458

342

57

481

23

532

413

73

560

36

NorthAmerica

Asia Pacific LatinAmerica

Europe Middle East& Africa

2010 2013

The regional opportunity is very small compared to other regions

Global players do not have easy access to relevant local / Arabic content

They might be restricted from operating in the region

Intigral®

6Developing the opportunity for Arabic digital content –the IPTV example…

Production• Producing Arabic digital content will require significant production costs for a smaller

opportunity than English content (e.g. Hollywood)• Relatively small population, fragmented audience and no secondary market

Co

nte

nt

Service design & delivery

• Minimum Guarantees require large subscriber base

• Need for specialist content knowledge (telecom operators do not have content expertise)

• Content adaptation / repurposing (censorship, dubbing, subtitling): investment & expertise (compliance)

• Infrastructure: IPTV head-end requirements are Capex-intensive for packaging content across multiple platforms

Content Creation,

Adaption,

Acquisition

Billing,

Care &

Analytics

Network(content

distribution)

User

Inter-

face

Content Mkg

& Sales

Service Design &

Delivery

Marketing & Sales

• Developing ways to bundle content with broadband and new media services. Market knowledge in media consumption, content promotion, pricing.

• Co-marketing and sales with content partners

• Leveraging marketing spends to create new digital media content opportunities.

1

1

2

Digital content value chain

Acquisition

3

2

3

Thank you

© 2011