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Q&A: Sherif Iskander, Rotana

Sherif Iskander, head of digital media at Arabic entertainment group Rotana, spoke to Jamie Beach about the challenges facing IPTV operators in MENA.

How has IPTV developed in the Middle East over the last 12 months?

The Middle East currently has a limited number of “true” IPTV implementations – most implementations are hybrids of either retransmission of satellite over IP or over-the-top services. The largest driving factor will be the launch of IP-based TV services by TV manufacturers trying to promote the value proposition of connected TVs. While this is a very fragmented approach that will lead to a plethora of competing platforms, it should act as a catalyst for more standards-based implementations in the future.

What role will IPTV play in the Middle East and Africa in the coming years?

I believe IPTV in the true sense of the word will make significant strides in new urban developments and high-end compounds. Bandwidth and infrastructure limitations will significantly hinder progress in existing cities and metropolitan areas. The transition will be gradual, with the value-added services taking the lead in deployment in hybrid models where linear channels are re-transmitted from satellite and VOD deployed in simple form.

How much of a threat is over-the-top video to established pay-TV services?

Long term, OTT TV and IPTV (pay and free) will merge into more flexible and interactive services. The threat is not a technology threat. The threat today is from “grey marketed” OTT boxes that come from other markets where content might be more reasonably priced or available earlier than in the Middle East and Africa. Examples are boxes like Roku and Apple TV, and web-centric services such as Hulu. The threat therefore is more of a business threat than a technology one. This threat to pay TV is further complicated by the fact that, unlike in Europe or North America, here in the Middle East bandwidth and pay TV are not provided through the same operator or provider, and hence the competition is going to be between bandwidth providers or ISPs that want to drive more bandwidth revenue by increasing demand for higher Mbps versus pay TV offered by satellite operators.

What are the major challenges faced by the IPTV opetators?

The biggest challenge for IPTV in the region is still the lack of a unique selling point that warrants the investments in infrastructure. Until IPTV in the region evolves on the services and interactivity levels, that USP will remain elusive.

What will prove to be the most popular interactive TV features in your market?

With satellite being the predominant form of transmission, localised services and advertising are non-existent. Introduction of localised advertising and interactive services will be a key anchor point for IPTV and interactive TV in general. Such localised services such as direct interaction with advertisement CTAs will create a more user friendly experience and drive adoption quickly. From the content side, well-structured on-demand services with premier windows in line with theatrical releases for movies will fill a significant market demand for premium content at home. Additionally, personalised grids and socially networked channels play-listed by users will create a unique experience that further differentiates interactive TV from traditional TV.

Are content security issues the biggest obstacle to TV Everywhere services?

Content security is just one of the issues. Bandwidth and delivery platforms are still challenged to provide a seamless TV Everywhere experience.

How can content providers and IPTV operators work together more effectively?

Both parties benefit when more content is consumed as on-demand or linear. The grey areas remain in what sort of cannibalisation to other revenue streams content providers will suffer. At the same time, because IPTV viewership is accurately measured and advertising can be targeted to the individual household, content providers will need to adapt to models where they are actually paid for what is being watched and what content generates advertising revenue, and not just based on channel audience in general and historical trends. For example a new series during Ramadan can be paid on a revenue-share basis for all advertisements shown during the viewing of each episode whether linear or on-demand. Ultimately this model will become a true catalyst for change in the content industry, driving creativity to new levels because of the immediate and accurate feedback on viewership and audience.

Tags: Rotana