MTV Networks eyes children’s market in the Middle East

MTV Networks International’s Nickelodeon Arabia is set to go on air in the Middle East in the second half of the year, becoming the network’s first localised free-to-air Arabic channel for children across the region.

 

The station, which will fall under the umbrella of Arabian Television Network (ATN) – Arab Media Group’s TV broadcasting arm – aims to take centre stage in the region’s untapped children’s market.

 

The networks hopes to launch four to five of its channels and brands in the Middle East by the end of 2010 from its broadcast base in Dubai, and is also looking into a hotel development deal in the region, according to MTVNI’s Emerging Markets managing director and senior vice-president, Bhavneet Singh.

 

He sat down with Emirates Business to discuss the region’s television sector and the group’s ambitious expansion plans. 

There seems to be a lot of interest in the Middle East media markets, with recent launches such as MTV Arabia and Virgin Dubai radio.

 

What is driving this interest?

For us, it was a culmination of a couple of things that fell in to place at once. One of them was the macroeconomics and macro-demographics are just so compelling. Sixty per cent of the audience is under 25 years old, which is a core demo both for MTV and Nickelodeon.
 

But what’s been additive is the fact that the economies have done very well in the past six or seven years.Also the media environment and regulation has become much more robust, much more transparent and has been growing consistently for the past few years.

 

If you look at the top 10 fastest growing ad markets in the world, I think four or five come from the Middle East. Yes, it still has a long way to go in terms of the true potential of the region, but if you take the audience desire for more differentiated and unique content, the scale that this market can provide eventually, and the growth and stability, all that makes for a very compelling reason to be here.

 

Is there a gap then in the market for children’s channels in the region?

We believe there is. There is no real global children’s brand that’s talking and engaging with Arab children in a language and manner they understand.

 

We’re doing a lot of research to find out what these children really want, what the issues that are pertinent to them, what things we want to showcase on the channel, which of our global franchises will resonate with this audience, what will be acceptable to their parents, and how we can do something that is not just for the child but for the parent as well? We definitely believe there is a big niche here where a brand such as Nickelodeon can take centre stage.

 

Who do you regard as your competition and how do you expect to take them on?

At the cost of sounding immodest, there is no one. We believe that Nickelodeon is not just a channel. We have merchandising, events, hotels, theme parks, and we’re doing a Nick cruise this year, so there’s no real brand or competition that we have, who can do that as well as we can.

 

The challenge for me would be, how can the channel be relevant and relate to a child equally in Saudi Arabia, Egypt and the UAE? [These] are countries in different stages of revolution and development and children and their sub-cultures are different enough to warrant specific targeted programmes.

 

What regulatory challenges have you encountered in terms of expanding in the Middle East?

I don’t think we’ve faced any significant regulatory challenges. Rather we’ve been welcomed and most of the regulatory dealings we’ve had have been very encouraging. That’s also helped by the fact that we are working in partnership with AMG, who understand the local regulation and the local norms much better than we do.

 

The continuing challenge for us is how to stay relevant as an umbrella brand across this vast region, yet relate with this microcosm of smaller cultures within that unifying language band. That is something we’ve done well on so far but which continually will be a big challenge.

 

Why was it important for you to team up with a local media company in Dubai?

When we started looking in the Middle East about two-and-a-half years back, we quickly came to the conclusion that it made sense to have a partnership with somebody who gets the dichotomy of the region, in the sense that it’s one language but an amalgamation of 10 different cultures within that. We have a licensing agreement with AMG.

 

We believe in an ideal mix of two key components that go to the success of any channel business we do here. We bring in the brand expertise and the global know-how and AMG brings in the local know-how, the local talent and the Arabic sensitivity and cultural understanding. All key decisions on what goes on air locally is the AMG team decision.

 

What is driving MTV to expand its global reach through more licensing deals?

I wouldn’t say we’re expanding purely through licensing – MTV Networks probably has the biggest footprint in terms of global reach. It reaches a billion-and-a-half people, and Nickelodeon probably reaches close to half-a-billion.

 

Every time we enter a new market, we look at whether it makes sense to do a fully owned business or a joint venture or licensing. And there are a myriad of reasons why you decide what approach to go with. The idea is to find out how we can get our brand and our content out there in the best way, in a manner that is most feasible economically and from a reach point of view.

 

What ad revenues do you expect here compared to other regions?

It’s a significant investment we’ve made into the region, both in terms of resources and financial, and we believe the ad market and the brand optimisation opportunities are good enough to seal in our investment in the medium to long term.

 

We are in no hurry to try to monetise or maximise return investments straight away. We believe if you can get the audience the dollars will follow, and that is exactly what we want to do. So we’re focusing purely on getting our relevance to the audience right first then we will worry about the second piece of it.

 

Which are the most profitable demographic segments in Dubai and who are you targeting?

We eventually want to be in a place where we cater to a demographic from age of four to 40. We have a portfolio of channels and brands that we believe will eventually be able to address each of the demographics that will give us the scale, and will also put us in a very unique position, as in some of the other markets in the world, such as the United Kingdom and the United States.

There we’re offering specific brand and content for a specific audience, but when we roll them up we’re offering something for everybody.

 

What are some of your plans in terms of offering digital services in this region?

We will have a full bells-and-whistles video-embedded Nick website that has the ability for games, downloads, and on-demand video services, and which will [be available] within six months of the channel launch.
 

We will also look at rolling out some of our associated services on Nickelodeon such as our web business and NickTropolis, which is a virtual world. We’re also looking at doing a Nickelodeon mobile service.

 

How did you decide on Dubai as the broadcast base for Nickelodeon’s first Middle East station?

We were fortunate enough to partner with AMG who have offices in most of the key capitals in the Middle East but their hub is here. From an infrastructure, regulatory, and talent pool point of view, Dubai seems to be the most obvious destination for people across the Middle East.

And in more ways than one it has become known as a broadcasting or media business hub. So when you want to attract the best talent in the industry or get a healthy environment where you have clear regulatory guidelines even in terms of connectivity, this seems the obvious choice.

 

How do you see the development of this region’s television sector as compared to other places in the world?

The Middle East is now at what I think is the tipping point. In the past few years, there has been a lot more active voicing of the demand from consumers of what specific content they want, which has fuelled this growth of channels that have come across. The business community and the media world are working towards realising that opportunity.

The second big thing is that [the Middle East] has come of age from a pure business standpoint. The advertising markets have grown, they’ve been showing strong growth for the past six to seven years, which again is not seen anywhere else in the world. I don’t know any other market where there are 300 free-to-air channels fighting it out, which makes it that much more interesting.

What will be the structure of the staff for the station?

We will have everybody local. We obviously might bring in some brand experts, so people who’ve worked on Nickelodeon brand internationally will come in to work with people here to share some of the best practices. But the channel is going to be run by local people, which is an amalgamation of different nationalities.

On MTV we have 12 or 13 nationalities of Middle Easterners who work on the channel, and we’ll probably have the same set up at Nickelodeon. It’s a channel that’s going to be reflective of a local Arab child on the street, so it has to be a local Arab person who knows that better than a European or an American.

 

The comedy service [Comedy Central channel] is the next venture we’re looking at. I can’t say whether it’s with AMG, but Nick Junior and VH1 will be with AMG. After we launch Nickelodeon, I’ll want to look at a Nick Junior proposition, which is for pre-school [audiences].
 

I hope that by end of 2010, we’ll at least have four to five services [in the Middle East]. They don’t necessarily have to be purely broadcast, we could launch the services purely on-demand, and then launch the wider broadcast platform later.

 

Currently overseeing the launch of Nickelodeon Arabia Singh is also responsible for the management and direction of more than 20 broadcast and broadband channels across Central and Eastern Europe, Central Asia and the Middle East.

Since joining the Emerging Markets group of the network in 2006 as deputy general manager, he helped launch MTV Baltics, MTV Turkey, the very first Comedy Central channel in Poland and the launch of MTV On-Demand in Romania. His most recent project has been the launch of MTV Arabia.

 

His global experience in new media comes from working for Manchester United in the United Kingdom, IMG WTI in New Delhi and the Discovery Channel in Asia. He holds an MBA from Manchester Business School.