YahLive revs up the HDTV offer

YahLive is the quintessential UAE-based company that combines government and entrepreneurship with practiced ease and characteristic panache. The Arabian Gulf-based nation is ‘littered’ with enough success stories, driven equally by government vision and individual enterprise – so when YahLive’s CEO talks about ushering the HD revolution in the region, you sit up and take notice. “In a market with 500 to 600 freeto-air TV channels and which also enjoys healthy competition from both local and international operators – it is important to differentiate ourselves from the incumbents. We therefore analysed and reviewed with our potential clients as to what the new, innovative and emerging technologies were – the simple answer was HDTV. We therefore concluded that our satellite would be a hotspot for the Middle East carrying HD-only broadcasts. Other satellite operators in contrast have a combination of HD and SD,” says Mohamed Youssif, chief executive officer of YahLive.

HDTV has been touted as the next big thing by the satellite, consumer electronics and broadcast fraternity for so many years now that the lay person cannot be faulted when he asks, “Aren’t we there already?” In reality, however, the marketplace for HDTV in the MENA region is akin to an unfinished puzzle that is missing somExe important pieces. Promising to complete the puzzle, Youssif says, “We commissioned a study in six countries in the Middle East – Morocco, Egypt, KSA, Kuwait, Lebanon and the UAE. The study indicated that 20 million HD television sets were sold in 2011 and I guarantee you that a very small percentage of them are watching ‘real HDTV’. Whilst manufacturers and retailers have made the plunge and today you would be hard pressed to purchase an SDTV, how many HDTV channels are out there for the viewer?”

Roadblocks to HDTV

The HDTV conundrum in the Middle East is not just a case of paucity of HD channels. There have been sporadic attempts by various broadcasters but what is holding them back is not just managing the steep start-up costs in developing appropriate infrastructure, against viewership and increased subscriber uptake. Describing it as a classic chicken and-egg stalemate, Youssif says, “Many broadcasters will plunge into HD only after knowing how many viewers have switched to HDTV and the opposite is true for the viewers. So we get into this vicious cycle. Currently, just as viewers have HD-compatible television sets at home, the equipment broadcasters are buying is HD compatible. In some cases, TV channels have native HD, and we are currently testing with a Kuwait-based channel where they produce their programmes in HD but convert it back to SD for other satellites. At YahLive, we are offering the technology to upscale broadcasters content to HD quality. We are happy for them to continue to broadcast SD on other satellites but come with YahLive for HD TV, thus reducing their risk. Once the viewer sees the difference, he or she will upgrade. To create a TV hotspot, as a new player, we realise that YahLive has to bring something unique and cost-effective to the table for both content owners and end users alike.”

With a critical mass of viewers who have HD-compatible television sets, the region is primed for a big push. And YahLive seems to be perfectly equipped for the task at hand. Established in 2009 when Al Yah Satellite Communications Company (Yahsat), owned by Mubadala, the investment arm of the Abu Dhabi government, entered into a partnership with European satellite operator SES ASTRA, YahLive will offer Direct-to-Home (DTH) television capacity and services to more than two dozen countries in the Middle East, North Africa, the South West Asian region and Europe. SES Astra was at the forefront of the HDTV rollout, broadcasting Europe’s first HD channel in 2004. Youssif underlined the significance of the partnership saying, “SES Astra is a global company owning and managing more than 40 satellites worldwide. SES has an excellent record of operating and maintaining satellites and their fleet enjoys an unprecedented reputation for carrying broadcast TV channels. However, they did not serve or operate in the Middle East DTH market. On the other hand, Abu Dhabi-based Yahsat owned by Mubadala, was established with aspirations to enter the space world and from that an initiative developed to combine the expertise of both groups into “YahLive” a joint venture with a 65 and 35% shareholding between Yahsat and SES-Astra respectively.

“At YahLive our mandate is to commercialise the 23 BSStransponders on the Yahsat 1A operating in the Ku-band frequency. The satellite has various payloads and the one dedicated to broadcasting is ‘owned’ by YahLive. It is not a lease but an ownership and the payload is considered as YahLive’s asset. In addition, SES Astra owns the frequency rights at 52.5 deg East orbital position and that is also considered an asset for YahLive. With a market capitalisation of $150 million, we, at YahLive, are now working hard to get TV channels on board.”

HDTV – the next logical step

At precisely 1:37am on April 23 2011, Abu Dhabi time, Yahsat’s Y1A was successfully launched from the European Space Center in Kourou, French Guiana. And on June 13 2011, following the successful completion of inorbit testing, the satellite Y1A, was officially handed over to Yahsat. With more than 30 years of experience in the satellite industry in the MENA region, Youssif knew that broadcasters would typically act only after they see the satellite in orbit.

“We have been in orbit for less than a month and we are in the process of finalising a number of contracts.” As a veteran in the region, Youssif also believes history is on his side. He  recalls, “Till 1998, there was only one satellite operator over the Middle East, namely Arabsat. All the receivers in our homes were analogue and all the dishes pointed to 26 deg East. When Nilesat arrived on station in 1998 they realised the future was digital. No one had digital receivers at home but if you go to the market to buy a receiver it would be digital. We’ve learnt from that experience. HD and 3D is the future. The incumbents cannot turn off the analog feed because they have receivers pointed at it and they don’t have enough capacity to quickly upgrade to HD so they are ‘stuck with their baggage’ as many operators will tell you. YahLive does not have any such baggage and is fully geared to cater to the emerging market for HDTV channels and those who do not take full advantage of their existing HD compatible television sets.”

With a Greenfield advantage and the financial clout to employ experts and partner with  proven global operators, the YahLive team is putting together a premium package of 60 to 70 most-watched channels in the Middle East – all in HD or HD quality as the upscaled SDTV is called. Youssif says, “Based on our study, we plan to be selective about channels with a premium package to differentiate ourselves from the rest, by catering to those who are interested in high quality transmission on HD and 3D with good quality content. We are going after the big broadcasters with an eye on the future and those intending to stay in the region for many years to come.”

The cost of switching to HDTV

YahLive appears to have overcome the big stumbling block in the move to HDTV by offering to upscale channels to HD quality. YahLive’s research indicates that the lesser hurdle, that of the viewer’s intransigence, will also be overcome. “Once the viewers watch popular  channels being broadcast in HD, they will upgrade because they have already invested over $ 1000 on an HD television set, so getting an upgrade in equipment (i.e. HD receiver) that would cost $120 to $150 dollars or installing another dish that is worth $20 dollars is not a big hurdle to cross. Our study showed that buying a dish has never been a barrier to entry.

In the face-to-face interviews that we conducted with people who had HDTV but had not experienced real HD, we were able to show the material in both SD and HD. There were a lot of surprised responses. A typical response was – can my TV really do that? Interest in HD rose from initial levels of 50 to 60 per cent to an incredible 98 per cent of those surveyed who wanted to acquire the full package of HDTV – i.e. a receiver and a dish pointing to our satellite. Once viewers experience HDTV it is very difficult to go back to SDTV.

So instead of switching between 500 – 600 channels to look for HD transmission, YahLive is offering the luxury of a package of most-watched channels exclusively in HD.” YahLive’s premium offering may just be the critical push the Middle East needs to move beyond what is now a scattered offering of sports channels or nature documentaries in HD, interspersed with a deluge of channels in SD. However, many of the 70 channels that YahLive proposes to offer will not be exclusive to the Abu Dhabi-based operation. What will compel the viewer who is inundated with channels from their low-end, set-top box, to make the shift, we ask? Youssif concedes that the Middle East broadcasting industry suffers from a weak penetration of pay TV. He says, “People are not used to paying for the channels. The idea of paying to receive TV is a bit hard to swallow even though every where else in the world, that is the norm. There is also a focus on number of channels offered, though the average viewer does not view more than eight to 10 channels at the most.” Good quality content costs money and eventually, Youssif says, people will have to pay. “Who says TV has to be for free? If it is free, then we don’t have the right to complain. Broadcasters are caught between a rock and hard place. Good quality content costs money. In addition, people’s behavior is changing. In our lifetime, we have moved from watching one or two channels to being able to watch what I  want when I want to. Broadcasters are finding it difficult to assess demand. And advertisers spend money on channels they assume people are watching, but they don’t really have  reliable feedback on viewer figures.” The penetration of pay TV in the US and Europe made it easier to launch HD given the captive audiences and the endless potential to crosspromote on a platform the viewers were already picking up. For Youssif and his team at YahLive, has the task been compounded by the ongoing recession? Youssif responds saying, “Launching a premium service during a region-wide recession does not worry us. People will always watch TV and in this region, for instance, during Ramadan, television viewership goes through the roof. Ultimately people may have to pay to watch good quality TV even if it was minimal, but for broadcasters it goes a long way when you consider that there are 165 million viewers in the region. That said however, this doesn’t mean that YahLive offer will be pay though.”

Competition and viewer expectations to drive HDTV

Change is decidedly in the air, as a traditionally value conscious viewer in the region wants choice and is increasingly discerning about quality. Youssif says, “A certain channel in the UK uses 16 – 18 MHz on the satellite because of competition and viewer expectations. Here the channel would use six MHz since you do not have too much competition. You have to be is slightly better than the rest, but that will change as viewers get increasingly aware of quality transmission. The issues of adult content and culture-specific content do not concern us since the channels we have selected are mainstream channels that our study has shown are popular in the region. Moreover, content is the purview of the channel owners not that of the satellite operator.”

Barely a year ago, channel owners interviewed by our sister publication BroadcastPro said that the “sums don’t add up’ to make HDTV economically viable. Will the equipment and cost pay itself off with increased ad revenues, they asked. YahLive’s offer promises to fundamentally shift the cost argument in favour of HDTV. Competition and viewer expectations will take care of the  rest, Youssif asserts. YahLive’s role is crucial in complementing and linking the groundwork done by manufacturers, retailers and broadcasters towards adopting HDTV as the new standard. Significantly, transition to HD in North America and Europe was aided by mandatory government switchover dates and heavy competition for  advertising and subscribers. Will we witness a similar move in this region? YahLive’s sister company in Germany, HD+ had incentives that included a one-year free-of-charge connection when purchasing an HD+ satellite receiver. Will similar incentives be offered in this region? As we prepared to leave his office on the outskirts of Abu Dhabi, Mohamed Youssif promised some groundbreaking announcements. He says, “What we have achieved at Yahsat in such a short time is monumental. This is just the beginning – we have big plans to conquer the industry in this region. You will hear a lot about us.”

About Mohamed Youssif

Mohamed Youssif has more than 20 years of professional experience in the satellite and telecommunications industry, particularly in the Middle East. Before taking responsibility for YahLive, he headed the commercial operations of Arab Satellite Communications Organisation (Arabsat) as Chief Commercial Officer (CCO). Prior to his assignment with Arabsat, he served as Managing Director of MESAT Consultancy and as General Manager for the Middle East at ICO Global Communications. Between 1987 and 1996, Mohamed Youssif worked for Hughes Network Systems where his latest role was Middle-East and North Africa Marketing Manager. Mohamed Youssif holds a university degree in telecommunications and electronic engineering.

About YahLive

YahLive was established in 2009 when Al Yah Satellite Communications Company (Yahsat), owned by Mubadala, the investment arm of the Abu Dhabi government, entered into a  partnership with European satellite  operator SES Astra. YahLive is to offer Direct-to-Home (DTH) television capacity and services to more than two dozen countries in the Middle East, North Africa and South West Asian region. At precisely 1:37am on 23 April 2011, Abu Dhabi time, Yahsat’s Y1A was successfully launched from the European Space Center in Kourou, French Guiana. The six-ton satellite with 10.9KW of power is located at 52.5° East and has a lifespan of 15 years. Y1A is equipped with acommunications payload featuring 14 active transponders in C-band, 25 Ku BSS transponders and a Ka-band government payload. The system includes gateways in C-, Ku- and Ka-bands, and a large number of ground terminals. In Ku band, Y1A offer three beams covering the Middle East, North Africa, South West Asia and Europe. YahLive offers the following key advantages:

Powerful coverage across all major cities in the GCC, North Africa and South West Asian countries

Strong signals enabling use of smaller dish sizes in favourable look angle to ensure uninterrupted service

Three connected beams in Ku band to enhance flexibility and eliminate audience waste.This is made possible by focused targeting as well as the ability to up-link in Europe and down-link to the target area