United Arab Emirates Gets First TV Ratings System
ABU DHABI -- The United Arab Emirates and the broader Persian Gulf region have long lacked a reliable TV audience measurement system, which observers this week said is holding back the media industry's growth prospects here.
"At the heart of the structural problem of the Middle East and North Africa market is the lack of a reliable TV audience measurement system," Oliver Wyman consultant John Turner told an industry crowd here during the Abu Dhabi Media Summit this week.
Tview is the new service offered by Emirates Media Measurement Company that wants to change that and just launched this month after a test phase. The system is run by international research firm Kantar Media and uses people meter and the tag line "your vision for television."
But industry observers know it is not everybody's vision. "There are certain people who benefit from opaqueness in the market," said Wyman. "There is strong inertia."
"Currently, there is a system using survey recall methodology," Christopher O'Hearn, general manager, Emirates Media Measurement Company, said at the same event. "That shows quite stable, unchanging results," which benefits those who do well in it.
But O'Hearn says the company is set up so that other media companies can come in as shareholders over time and join current shareholders and investors, which include Saudi Prince Alwaleed bin Talal's Rotana, in which News Corp. owns a stake, Abu Dhabi Media and telecom giant Etisalat, among others.
"There are many, many unique things about this market," he explains the difficulty of establishing a ratings system, an endeavor that has failed several times in the past. "There are no reliable census figures here. We can spend months arguing about what the country looks like before we set up [research] panels."
Kantar data and telephone surveys helped overcome that challenge. But O'Hearn emphasizes that about 20 percent of the population won't be able to be measured reliably -- also due to unique characteristics of the region. "The only people we don't cover are ones in labor camps and dormitories, because we can't get individual demos there," he said.
Still, the company covers a universe of around 6.5 million people.
Another limitation is the number of channels tview will capture. "We would like to eventually get set-top box data to capture even smaller channels," O'Hearn said. "This is such a fragmented market. In most countries, you can capture 50 percent-60 percent of TV viewing with a number of channels you can count on one hand."
His company's system will measure 58 channels, including Viacom's Colors, News Corp. channels such as Fox Movies, FX and Fox, Sony TV and Sky News Arabia, out of around 400-plus available. "That captures only half to 60 percent of the viewing," he explained.
Other challenges include widespread piracy and the fact that it is considered unusual or rude to go to people's houses unannounced -- not only to ask them to use people meters.
All this has left an audience measurement system nothing more than a dream so far. And it has kept a lid on the regional TV industry's growth potential, many say,
"The TV ad market in the Middle East is at an unnaturally low level," Turner said.
"That causes problems for people who want to invest, such as big international media companies. They look at the overall market and say why bother."
Gross ad spending for the Arab world amounts to roughly $1.9 billion a year, according to Turner. About $1.5 billion of that comes from free-to-air TV as pay TV is in less than 10 percent of homes in the region, he said.
The gross spend is about 2.6x smaller than it should be, by some estimates even 3.4x smaller, the consultant suggested.
"The gross number is very significantly smaller than it should be. If you are a media owner that is very bad news," Turner said, suggesting that most big TV network operators in the region lose money.
The net ad revenue for media companies is even smaller. Turner's company estimates it at $650 million-$720 million.
"That's a very, very small numbers," he explained.
Observers expect a big impact of tview on the TV market for that reason alone.
"The current system is not dynamic and granular," O'Hearn said. "And there is a week- or month-long delay. This is bringing minute-by-minute analysis every day. It will make people's life hell -- in a good way."
For example, the assumption here so far has been that an ad spot gets the same viewership as the program that it runs in -- and that despite ad breaks of up to around 9 minutes in popular shows, O'Hearn said.
tview's data shows that people typically tune out soon after the start of the commercial break, even though they typically return when the show resumes.
"Audiences just go," said O'Hearn. "Networks under the new system would have to change" to retain audiences and advertisers. "Everybody here has been running a supermarket stocked with tins. Now you must turn into a fresh fruit market and check if your fish stinks."
With a more detailed data set, marketers can go from a shotgun to a more targeted approach.
One result could be higher ad rates for the time around 2-3 p.m. or 3:30 p.m., O'Hearn predicts. His data shows an audience peak starting around 2pm that doesn't show up in the traditional recall surveys, but in which TV viewing hits 80-90 percent of primetime viewership. O'Hearn's explanation: "Schools end at 2 p.m. and a lot of people who close shops for afternoon take a break. And government workers finish around 2-3 p.m. But ad people more or less give away afternoon ads" right now.
Another way that advertisers could target are by distinguishing between the TV viewing habits of the large Indian population and Arabs. Indians tend to watch most TV in the 8-10 p.m. primetime slot, while Arab primetime viewing is pushed later into the night with the biggest audiences around 10 p.m.-1 a.m., O'Hearn said.
Many of the biggest TV shows, such as the local version of The Voice on MBC1 and Arabs Got Talent on MBC4 here therefore air in the 10-11 p.m. slot, he said. "Big format shows do well here," he said.
MBC, Middle East Broadcasting, based in Saudi Arabia and broadcasting from Dubai is generally considered the biggest network in the Gulf region, experts say.
But while tview may change some TV programming and ad rates here, other things will not change, because tradition or religion is involved, according to O'Hearn.
"Ramadan programming is something that is unique to the Arab world. For one month of the year, TV schedules are completely different. You wouldn't show or watch Idol or other format shows then. You abandon your regular schedule, and it's all about soap operas, especially big Turkish dramas."
Some estimates say that networks focus 70-80 percent of their annual programming expenses on Ramadan programming as some channels focus on that time of year. While the viewing won't change, the uneven budget spending probably will, thinks O'Hearn.
Some fear that the reach of the new audience measurement system may remain limited though instead of being pushed out across the region.
Saudi Arabia, for one, is working on its own audience measurement system, which experts expect to go live in about a year.
"More than 70 percent of TV ad spending go to Saudi Arabia, Egypt and the United Arab Emirates," said Turner. "Until you get all three, you don't get audience measurement for the region."
O'Hearn is still hopeful. "Eventually, we would like to have a system across the Gulf," he said. "There are discussions going on among the [Gulf region] countries. Combining efforts would make sense as some countries wouldn't be able to afford their own system."