Gulf region to continue video revenue growth

The Gulf Cooperation Council (GCC) video industry grew revenue by 11% year-over-year in 2021 to reach US$1.9 billion.

According to a new report from Media Partners Asia (MPA), SVOD contributed 23% to total GCC video industry revenues while AVOD contributed 26%. Total online video revenues are projected to grow at a CAGR of 7% to reach US$2.1 billion by 2026 with SVOD contributing 31% and advertising, 34%.

While streaming continues to thrive, the pay TV sector saw a 10% decline in 2021 to sit at US$631 million. This sector is expected to further contract to US$436 million by 2026.

The report goes on to note that advertising-funded terrestrial and satellite free to air generated US$366 million in 2021 revenue, down 3% year-over-year. This sector will also continue to contract, reaching US$311 million by 2026, while it will account for 15% of total GCC video industry revenues (down from 40% in 2016).

MPA vice president Aravind Venugopal said: “During 2021, some of the momentum from COVID-19 which accelerated the adoption of online services, started to taper. While subscriber additions decelerated during 2021 as Covid-related restrictions eased, an increased content pipeline for SVOD platforms resulted in flat to marginal subscriber growth for most operators. 

“In the medium term, the launch of new platforms and the increased scale and frequency of investment in premium content by SVOD players should drive future net new customer additions. However, profitability remains a challenge with heightened competitive intensity, which will only increase as the beINowned TOD, Disney+ and HBO Max launch over the next 12-24 months.”