The secret is out my friends…welcome to our new disjointed world of media. It is one where fewer humans watch TV and more <a href=”http://www.watchmojo.com/blog/business/2010/01/21/kids-spend-every-waking-minute-connected-to-web-and-on-mobile/”><em><strong>teenagers</strong></em></a> spend every waking minute connected to the internet.<!–more–> Lifeless are the days when more than 30% of households would watch prime time television; typically meaning that an advertisement slot during that period would potentially reach “everyone”. According to Nielsen, prime time reach is barely 5% today and we are officially turning to new mediums that feed our need for video, but are definitely not the TV set. This fragmentation coupled with social media’s loyal and powerful user gains are placing online video at the forefront of the web. Nevertheless, we remain in transition and the condition of video content in the world is still quite the plight – Yet, even more so in our corner of the planet.
Considering that the internet in the Arab world is safely 10 years younger than the web of the west, as a product, online video can seamlessly be placed in the shoes of search back in the early days. Figuratively meaning: it is an integral part of cyber-sphere that is just praying for a solid business model to come and save the day. Advertising may be one stream, subscriptions would be another and content licensing is a third, but why haven’t we seen a champion in the field just yet?
Now before we get all sentimental here, let’s realize that video hasn’t been a hopeless case with advertisers in the past. Regional properties such as <em><strong><a href=”http://www.d1g.com/”>d1g.com</a>’s <a href=”http://www.d1g.com/video”>Clibbat</a></strong></em>and <a href=”http://www.ikbis.com/”><em><strong>Ikbis</strong></em></a> have done rather well and grown many folds since launch, but the cost of streaming anything that is anywhere near 80TB worth of data every month comes at a hefty price tag that is definitely not being covered by video advertising campaigns – especially not in the Arab world. From TV trends we find that there is a direct relationship between the increase of channels and the increase of consumption. The problem is that advertising will not grow fast enough to feed all the mouths of the players in the video business. Hypothetically, as “consumer touch points” multiply, the number of people that each piece of content reaches is smaller at broadcast, but can grow with time. Enter the double edged sword – revenues online will be less than its TV counterpart for popular events, but the content owner will be capable of drawing more revenue over the course of the piece’s shelf life. Technically speaking, all video matter on the web can build a following and possibly gain an enduring revenue stream, but since there is no vetting process in the mix – the lowest common denominator can be nil. Not to mention that most consumed content is “crap” and cannot be monetized due to the fact that advertisers do not want to associate their brands with it. Putting this into context, a site like YouTube would probably only be able to monetize about 5% of its videos … So much for that idea!
Over the past few years, we’ve established that Arab users are hungry for rich media content over the web, and the mainstream opportunity for video is still just around the corner. To put matters into perspective here, an elaborate <a href=”http://techcrunch.com/2009/06/09/cisco-by-2013-video-will-be-90-percent-of-all-consumer-ip-traffic-and-64-percent-of-mobile/”><em><strong>study</strong></em></a> conducted by Cisco in 2009 suggests that 90% of all consumer IP traffic will be video by the year 2013 with a compound annual growth rate of 131%. In drilling this down by region, we find that the Middle East and North Africa is projected to experience the highest growth rates in the world over the next three years with Latin American and Central Eastern Europe tagging closely behind.
877,000 Terabytes of data in 2013 is no joke, exceptionally when considering that 35% of users in the Arab world are tapping in with a 512 kbps connection! A study conducted by <em><strong><a href=”http://www.d1g.com/”>d1g.com</a> </strong></em>around the state of video in the region teaches us that Arabs highly demand two types of content; miscellaneous videos (30%) and Movies (29%). Both of which are sadly can’t be monetized today, due to “crap” and copyright issues.
On the other hand, are users willing to pay for these videos that they want so bad? You probably guessed it…The overwhelming majority (54%) of Arab users are not willing to pay for the content they so happily and readily consume. Observations on the graph below suggest that less than half of Arabs would actually pay some amount for video online, but we all know that all the bells and whistles would have to be included to make the sale (HD video, premium & super premium programming…etc.).
Now, for the million dollar question: Is all the hassle worth the opportunity?
Naturally, getting paid for content is ideal but indicators sadly tell us that consumers will never pay for it online today – perhaps for a while too. What is left is syndication (getting other companies to pay for the content), but the Arab media space is far too young to see that model pass over to the internet as well. Perhaps for profit, web video is a bit of a discouraging case today. Despite all the difficulties, we need to realize that feeding relevant on demand video into the eyes of the Arab world is extremely important for our users, culture and growth of the web eco-system. For the sites themselves, video drives awesome traffic and usage generally spills over into other services, but the real prospect lies in providing Arabs with an open stage to share their interests and thoughts amongst themselves and with the rest of the world. The internet has brought around some unique possibilities for us to broaden our horizons. Ones that allow users to capture interest and “pull” for content instead of the “push” they’ve been so used to. It is a chance to make decisions and choose to be influenced, inspired and enthused by what we seek to see. Today, that alone is priceless and good things might as well be monetized later.
Arabian Videology: The Online Motion Picture
FJ
May 17
|16:46
The secret is out my friends…welcome to our new disjointed world of media. It is one where fewer humans watch TV and more <a href=”http://www.watchmojo.com/blog/business/2010/01/21/kids-spend-every-waking-minute-connected-to-web-and-on-mobile/”><em><strong>teenagers</strong></em></a> spend every waking minute connected to the internet.<!–more–> Lifeless are the days when more than 30% of households would watch prime time television; typically meaning that an advertisement slot during that period would potentially reach “everyone”. According to Nielsen, prime time reach is barely 5% today and we are officially turning to new mediums that feed our need for video, but are definitely not the TV set. This fragmentation coupled with social media’s loyal and powerful user gains are placing online video at the forefront of the web. Nevertheless, we remain in transition and the condition of video content in the world is still quite the plight – Yet, even more so in our corner of the planet.
Considering that the internet in the Arab world is safely 10 years younger than the web of the west, as a product, online video can seamlessly be placed in the shoes of search back in the early days. Figuratively meaning: it is an integral part of cyber-sphere that is just praying for a solid business model to come and save the day. Advertising may be one stream, subscriptions would be another and content licensing is a third, but why haven’t we seen a champion in the field just yet?
Now before we get all sentimental here, let’s realize that video hasn’t been a hopeless case with advertisers in the past. Regional properties such as <em><strong><a href=”http://www.d1g.com/”>d1g.com</a>’s <a href=”http://www.d1g.com/video”>Clibbat</a></strong></em>and <a href=”http://www.ikbis.com/”><em><strong>Ikbis</strong></em></a> have done rather well and grown many folds since launch, but the cost of streaming anything that is anywhere near 80TB worth of data every month comes at a hefty price tag that is definitely not being covered by video advertising campaigns – especially not in the Arab world. From TV trends we find that there is a direct relationship between the increase of channels and the increase of consumption. The problem is that advertising will not grow fast enough to feed all the mouths of the players in the video business. Hypothetically, as “consumer touch points” multiply, the number of people that each piece of content reaches is smaller at broadcast, but can grow with time. Enter the double edged sword – revenues online will be less than its TV counterpart for popular events, but the content owner will be capable of drawing more revenue over the course of the piece’s shelf life. Technically speaking, all video matter on the web can build a following and possibly gain an enduring revenue stream, but since there is no vetting process in the mix – the lowest common denominator can be nil. Not to mention that most consumed content is “crap” and cannot be monetized due to the fact that advertisers do not want to associate their brands with it. Putting this into context, a site like YouTube would probably only be able to monetize about 5% of its videos … So much for that idea!
Over the past few years, we’ve established that Arab users are hungry for rich media content over the web, and the mainstream opportunity for video is still just around the corner. To put matters into perspective here, an elaborate <a href=”http://techcrunch.com/2009/06/09/cisco-by-2013-video-will-be-90-percent-of-all-consumer-ip-traffic-and-64-percent-of-mobile/”><em><strong>study</strong></em></a> conducted by Cisco in 2009 suggests that 90% of all consumer IP traffic will be video by the year 2013 with a compound annual growth rate of 131%. In drilling this down by region, we find that the Middle East and North Africa is projected to experience the highest growth rates in the world over the next three years with Latin American and Central Eastern Europe tagging closely behind.
877,000 Terabytes of data in 2013 is no joke, exceptionally when considering that 35% of users in the Arab world are tapping in with a 512 kbps connection! A study conducted by <em><strong><a href=”http://www.d1g.com/”>d1g.com</a> </strong></em>around the state of video in the region teaches us that Arabs highly demand two types of content; miscellaneous videos (30%) and Movies (29%). Both of which are sadly can’t be monetized today, due to “crap” and copyright issues.
On the other hand, are users willing to pay for these videos that they want so bad? You probably guessed it…The overwhelming majority (54%) of Arab users are not willing to pay for the content they so happily and readily consume. Observations on the graph below suggest that less than half of Arabs would actually pay some amount for video online, but we all know that all the bells and whistles would have to be included to make the sale (HD video, premium & super premium programming…etc.).
Now, for the million dollar question: Is all the hassle worth the opportunity?
Naturally, getting paid for content is ideal but indicators sadly tell us that consumers will never pay for it online today – perhaps for a while too. What is left is syndication (getting other companies to pay for the content), but the Arab media space is far too young to see that model pass over to the internet as well. Perhaps for profit, web video is a bit of a discouraging case today. Despite all the difficulties, we need to realize that feeding relevant on demand video into the eyes of the Arab world is extremely important for our users, culture and growth of the web eco-system. For the sites themselves, video drives awesome traffic and usage generally spills over into other services, but the real prospect lies in providing Arabs with an open stage to share their interests and thoughts amongst themselves and with the rest of the world. The internet has brought around some unique possibilities for us to broaden our horizons. Ones that allow users to capture interest and “pull” for content instead of the “push” they’ve been so used to. It is a chance to make decisions and choose to be influenced, inspired and enthused by what we seek to see. Today, that alone is priceless and good things might as well be monetized later.
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