Ramadan shows give TV revenue a big boost
Television companies across the region are enjoying a 20 per cent increase in advertising revenues this Ramadan as the industry makes its most significant step yet towards recovering business lost since the Arab Spring.
The Holy Month is the most important time for the region's US$2 billion (Dh7.34bn) TV advertising market with millions watching religious shows and long-running soap operas.
The Pan Arab Research Centre (Parc) estimates that advertising on TV channels across the Arab world rose by a fifth in the first week of Ramadan compared with the same period last year.
Such growth would mean the amount spent on Ramadan TV advertising should exceed the $420 million forecast for this year, based on industry estimates.
Sami Raffoul, the founder and general manager of Parc, estimates the 20 per cent growth rate will be sustained throughout Ramadan.
"It will be around that range, eventually a little higher," he said.
"The issue is due to more adverts running on the air combined with new stations."
Mr Raffoul pointed to new TV stations in Egypt as spurring growth in the advertising market.
A total of 16 new Egyptian channels obtained licences to broadcast in the first half of last year and Mr Raffoul said more had launched since. Notable new entrants to the market include CBC, Al-Nahar and 25TV.
"There are a lot of Egyptian stations which have blossomed in the last year with the deregulation in Egypt," he added.
"The revolution in Egypt has created a very open environment for freedom of expression. And this itself has helped those stations to grow, commercially speaking."
Mohammed Burhan, the chief executive of the news station CNBC Arabia, based in Dubai, said the overall advertising market was expected to recover this Ramadan after a tough financial crisis and the Arab Spring.
"It's getting healthier this year. The trend during Ramadan is good, it's up … But I don't think that it's matching what happened before the Arab Spring."
The total Arab advertising market is forecast to be worth $4.9bn this year, according to the Arab Media Outlook, a report published in April in collaboration with the Dubai Press Club and Deloitte. Television accounts for a big chunk of this with total spending expected to hit $1.98bn this year.
According to Parc, 21.2 per cent of the last year's TV advertising was spent during the Ramadan period.
Time spent watching television also rises during Ramadan. According to Parc, UAE viewers are spending an average of five hours and 12 minutes a day watching television this Ramadan, up 9 per cent on last year.
Other monitoring groups have higher estimates for Ramadan TV-viewing. Tview, which measures TV audiences in the UAE, estimated individuals watched television for an average of six hours and nine minutes a day during the first 10 days of Ramadan, 32 minutes more than the average in the first six months of the year.
"There's a very big increase in the amount of people viewing television, particularly in the evening," said Christopher O'Hearn, the general manager at Tview. "From 5 or 6 o'clock onwards, there's clearly a lot of family-orientated viewing going on."
While audiences and advertising revenues tend to increase during Ramadan, so does the cost of making special shows for the season.
"A huge proportion of production and advertising budgets go during the Ramadan period," said Mr O'Hearn.
The Tview ratings are produced by the Emirates Media Measurement Company, a joint venture supported by Abu Dhabi Media, which owns and publishes The National, as well as Sharjah Media,Rotana Media, Etisalat and du.
The initiative was led by the National Media Council and the Telecommunications Regulatory Authority.
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Updated: August 5, 2012 04:00 AM