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Connectivity in the Middle East

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      Home Opinion

      Connectivity in the Middle East

      Guest Columnist by Guest Columnist
      August 18, 2017
      in Opinion
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      The fall in oil prices in the Middle East and North Africa in the last few years, although now recovering, has had a knock-on effect on spending on broadcast technology and services in recent months, with budget cuts, deferred projects and overall decreases in investment.

      Paul Airey is Sales Manager of SIS LIVE.

      The fall in oil prices in the Middle East and North Africa in the last few years, although now recovering, has had a knock-on effect on spending on broadcast technology and services in recent months, with budget cuts, deferred projects and overall decreases in investment.

      Demand for occasional-use satellite connectivity has remained strong, however, even increasing, which continues to make the region a very attractive proposition for growth in the provision of these services, provided the price is right.

      In part because of pressure on oil revenues, the MENA region is more price-sensitive than most for similar services. It also tends to be more reactive, in that long-term planning for satellite capacity is less common than the more prevalent last-minute requests for satellite service. I should perhaps rephrase ‘occasional use’ to ‘right now’, as many requests that come into booking departments are for capacity needed within the hour.

      A corollary to the price sensitivity for satellite connectivity is that it also applies to the growing IPTV market, and perhaps even more so. Although satellite with IPTV delivery is very much on the rise in the region, it is still underdeveloped, and because the majority of IPTV offerings have been introduced by regional telcos, the proverbial ‘last mile’ connectivity into the home is a bit more complicated and, importantly, expensive.

      HDTV delivered by satellite has achieved significant penetration, and although the total number of HD channels is still somewhat limited, demand is growing rapidly, which has in turn prompted a significant expansion of capacity offered by satellite service providers.

      All of the above said, it is fair to add that many parts of the region are still very much in the throes of the transition to digital broadcasting, and by default HD, UHD and multiplatform delivery. And because most of these transitions are backed, at least in part, by government-led initiatives, many of them currently lack the financial resources to not only revaluate and reconstruct broadcast infrastructures, but to extend that financial support to individual homes with subsidised set-top boxes and the like. Nevertheless, the digital transition continues, and with that the need for satellite connectivity services and, increasingly, fibre-based IPTV services.

      As with broadcast suppliers the world over, the primary drivers of increased service, technology sales and expanded connectivity are the insatiable demand for news and sport, which has helped drive expansion in the region.

      News in particular is still for the most part delivered by traditional SNG connectivity rather than emerging technologies such as cellular bonding, which means demand for satellite capacity remains high. This also means that although there are a lot of capacity-only sales, satellite capacity sales are very price-sensitive and there are many operators competing for that business.

      The other driver, sport, particularly considering the 2022 Qatar World Cup, is in our case based on interest in UK-based sport (okay, football) and bringing it back to MENA. In our case, this is primarily via satellite via our UK teleports. Fibre networks that connect more than 100 sport and entertainment venues and international data centres have received increasing interest from broadcasters, partners and customers in the region.

      But the key to fibre is availability, and with that the ability to establish relationships with multiple data centres that already have strong ties to the Middle East. For example, data centres in Paris with strong ties to MENA can deliver services from the UK to Paris and then on to customers in MENA. The simple fact is that the fibre proposition has too many advantages, particularly in light of the migration to IP-based products and services, to not be developed and expanded in tandem with established satellite offerings.

      So while spending has been lagging in recent years, demand has not. And what we’ve seen throughout history is that demand almost always wins in the end.

      Paul Airey is Sales Manager of SIS LIVE.

      Tags: Connectivity in the Middle EastIPTVPaul AireySIS LIVE

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