MENA Entertainment & Media Outlook 2020-2024

Executive summary

COVID-19 has had an extraordinary impact on entertainment and media revenues¹ and patterns of consumption in the Middle East and North Africa (MENA), just as it has across the world. The damage to physical media spending – from cinema box office takings to concerts, corporate events and newspaper and magazine advertising – means revenues in the region are expected to fall by 8.3% to $19.7bn this year².

We expect spending bounce back to gradually recover to 2019 based on a successful COVID-19 vaccine being widely available in the region, and to continue to grow from 2022 onwards. Overall, we expect entertainment and media revenues to increase by 3% in the region between 2019 and 2024, exceeding the 2% rise forecast globally³.

To a large degree, COVID-19 and its after-effects have pulled the future forward, as consumers in the region take more control of their own media consumption, faced with an ever-expanding range of channels and content. As a result, we expect a K-shaped recovery, with the industry split between areas that return to growth quickly and others that go through a lengthy downturn. Digital entertainment led by OTT video (‘over the top’ or streamed video services such as Netflix, Shahid and Starzplay), gaming and digital music will grow at an accelerated pace to 2024, while in-person events will continue to suffer until restrictions to curb the spread of the virus end, and physical newspaper and magazine sales will decline more steeply than pre-pandemic.

Crucially, these changes in consumer behaviour require media companies in the region to consider new digital business models such as subscriptions, leveraging direct relationships with consumers and monetising content rather than relying solely on advertising as they have done in the past. And while MENA already has some of the highest mobile phone usage in the world, with 4G accounting for a third of mobile connections⁴ and 5G already launched in some markets, governments must work to expand digital infrastructure such as high-speed broadband access, public and private clouds, data centres and content delivery networks to enable content streaming and new content consumption experiences at home and on the go.

In this report, we will look in more detail at the shift to digital entertainment and paid content, the new business models and infrastructure required to support this change, and what governments and regulators can do to support the evolution of the industry.

A strong digital backbone

An essential enabler to support the growth of digital media and entertainment is sufficient digital infrastructure to allow consumers to watch, play and listen to online content from anywhere. Some countries in the region have already made significant investments in this area – in Saudi Arabia, the government and private sector has spent $15bn on ICT infrastructure since 2017 and as a result, the entire country has internet coverage. Saudi Arabia was also one of the first countries to offer commercial 5G services⁸. 

Across the region as a whole, high-speed home broadband coverage is low, ranging from 3% of the population in some countries to 40% in others (excluding the UAE and Qatar where the proportion is higher). The lack of coverage has been offset by widely available, high quality 4G and new investments in 5G. However, investment is still required to provide high-speed broadband to the broader population at affordable prices and expand coverage in rural areas. Improving distribution capabilities, upgrading service providers’ system capabilities, and expanding content distribution networks are all necessary to support the growth of digital media and entertainment services.