The Coming Contenders
Issue 11, Summer 2010
Prince Alwaleed Bin Talal on his private plane
There are 487 free-to-air (FTA) Arabic satellite TV channels broadcasting on Arabsat, Nilesat and Noorsat, in addition to the dozens of ailing terrestrial channels.1 The region's media landscape has become saturated, as indicated by the drop in the number of new channels going on air, from 104 between August 2007 and March 2009 to just thirteen during the financial year to April 2010.2
When it comes to pan-Arab satellite news channels, there has been no major entrant into the broadcasting arena since the Saudi-backed Al Arabiya, part of the MBC Group, went on air in 2003 in response to the Qatari-owned heavyweight, Al Jazeera.
There have certainly been attempts to contend with the two big players, yet the numerous Arabic-language news channels launched by governments in recent years to win hearts and minds, such as by Britain (BBC Arabic), Russia (Russiya Al Yaum), Iran (Al Alam), China (CCTV) and the United States (Al Hurra), have not drawn the same audience figures.
The Arab world's news duopoly is set for a shake-up, and it is to come from two ventures that are connected to one of the world's biggest media organizations, Rupert Murdoch's News Corp. The common thread is Saudi Arabia's Prince Alwaleed Bin Talal, head of Kingdom Holdings Company (KHC)3, which owns the entertainment group Rotana.
The Rotana tie-up
It has not been good times of late for KHC, with the value of the firm's overall assets slumping 44.4 percent in the fourth quarter of 2008, a $8.26 billion net loss. This year the investment firm reported gains, netting profits of $20 million. But the Rotana Group, which has six TV channels4, radio stations, a digital media group and is the world’s largest producer of Arabic music 5, has reportedly been struggling in the changing media landscape, a reason analysts believe Prince Alwaleed is mulling the option of selling stakes in the group through an initial public offering (IPO) sometime in the next two years.6
It has also been suggested as a factor behind the Lebanese Broadcasting Corporation's (LBC) decision to lay off 140 staff earlier this year.7 LBC-SAT is 85 percent owned by Prince Alwaleed, a stake the mogul has gradually increased since buying into the channel in 2000 with a 49 percent stake.8 LBC SAT and Rotana merged in 2007.
1 Satellite TV in the Arab World 2010 Report, April 2010, Arab Advisors Group
3 Kingdom Holding is 95 percent owned by Prince Alwaleed, the nephew of King Abdullah. The firm most prominent stake is in Citigroup, hotel chain The Four Seasons, Movenpick and News Corp.
4 Cinema (movies), Clip (music clips), Moussica (contemporary music), Resala (religious), Tarab (classic music) and Zaman (classic movies)
5 Faced with widespread piracy in the region, Rotana has lowered the cost of music CDs to retain sales, from 45 Saudi Riyals ($12) to 15 Riyals ($4), the same as a pirated CD. Sales quadrupled. - “Rotana aims to sink pirates with low cost for content”, Keach Hagey, The National, February 3, 2010.
6 Alwaleed moots Rotana Holding IPO”, April 27 2010 - www.ameinfo.com/230862.html
8 Prince Alwaleed bought the shares off Saudi media mogul Saleh Abdullah Kamel for $100 million. Prince Alwaleed also owns stakes in two daily Lebanese newspapers, 17% of Al Nahar and 25% of Al Diyar.
9 “Rotana signs $26.7m TV deal with Walt Disney,” Bloomberg, 13 December 2009. Rotana has also inked a deal with Yahoo Middle East that will provide free access to multimedia content from Rotana – including music, films, TV, radio and Ramadan features – through Yahoo’s recently launched video channel. “Yahoo tunes in to Rotana for content in Arabic”, Ben Flanagan, The National, July 8, 2010
10 This year strategic partnership was also struck between Fox International Channels and Abu Dhabi's twofour54.
12 “Saudi tycoon to launch 24-hour news channel,” AFP, July 7, 2010
13 Khashoggi resigned earlier this year after Al Watan published an opinion piece questioning Salafism in Saudi Arabia. The article, written by Saudi poet Ibrahim Al Almaee, was published while Khashoggi was out of the kingdom. Khashoggi later claimed that he did not agree with the points made in the article - “Prince opens channel with Fox,” Ben Flanagan, The National, July 6, 2010
14 “Khashekgi to start a news television channel,” Elaph, July 6, 2010 – translated Mideastwire.com
15 “Tussle of Arab news stations set to heat up,” Andrew England and Robin Wigglesworth, The Financial Times, July 17, 2010
16 'Sky in talks over Abu Dhabi channel', Ben Flanagan, The National, July 14, 2010
18 “Sky News in talks to launch Arabic TV station in Abu Dhabi,” Ben Flanagan, The National, July 14, 2010
19 “Al Hurra: Propaganda tool or voice of the people?”, John Parnell, Digitial Media Production Middle East, June 23, 2009
20 “Wadah Khanfar on a life and death struggle,” Claire Ferris-Lay, Arabian Business, July 8, 2010. Khanfar is the director-general of Al Jazeera. For more information on Saudi Arabia's pressure on advertisers see Hugh Miles' Al Jazeera: The Inside Story of the Arab News Channel that Is Challenging the West (New York: Grove Press, 2005).
21 Baroud is also the editor of PalestineChronicle.com, and author of “My Father Was a Freedom Fighter: Gaza's Untold Story.”
22 Fox News did not respond to questions sent by the author.
23 "The Rotana partnership with Murdoch," Sateh Noureddine, As-Safir, February 28, 2010 – translated by Mideastwire.com
24 Iraqi media has also followed this track in the post-2003 environment with dozens of channels launched and the majority connected to political and/or religious parties and governments. See “Iraq: A Diverse Media,” David A. Rousu, Arab Media and Society, Issue 10, Spring 2010 and “The ‘Lebanonization’ of the Iraqi Media: An overview of Iraq’s television landscape,” Paul Cochrane, Transnational Broadcasting Studies, Volume 2, Number 1, 2006.
25 The Orbit-Showtime Arabia merger happened in 2009, to form the “biggest Pay-TV platform” in the region with some 70 entertainment and sports channels - “Showtime Arabia and Orbit merger is complete,” Emma Goma, Arabian Business, August 11, 2009
26 See “Saudi Arabia’s Media Influence,” Paul Cochrane, Arab Media and Society, October, 2007
27 “Saudi Rotana bets on News Corp to lead Arab media,” Reuters, February 23, 2010
28 “The Greatest Resource of Them All”, Rupert Murdoch, Abu Dhabi Media Summit, March 9, 2010
29 “Murdoch’s Dealings in China: It’s Business, and It’s Personal,” Joseph Kahn, The New York Times, June 26, 2007
30 The Independent obtained the details of Murdoch and Blair's phone calls through a Freedom of Information request. “Planet Murdoch: is nothing out of his reach?” Stephen Foley, The Independent, August 2, 2007