Local TV channel bouquet for $4. Income from advertising is dwindling - Lebanon

Local TV channel bouquet for $4
Income from advertising is dwindling
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Local TV stations have agreed to move from free program broadcasting to fee-based broadcasting. Station representatives agreed on a $4 (LL6,000)bouquet per month for all eight stations: LBCI, MTV, NBN, Al Jadeed, OTV, AL MANAR, Al Mustaqbal, and Télé Liban.

According to Talal Makdessi, Chairman of the Board of Télé Liban, TV stations are negotiating with cable providers to reach an agreement about the shift from free to paid broadcasting. “Cables have been diffusing our programs without paying rights for over 20 years and it is time that we start earning back our rights,” he said.

The TV cable subscription is between LL15,000 and LL20,000, per month. Cable providers will have to collect the LL6,000 out of these monthly subscriptions, without any extra charge to end users.

Makdessi said that TV advertising has been dropping drastically since 2010 and TV channels are suffering.

According to him, the announced advertising budget is $1.26 billion, whereas the real sum is $60 million. “This is only five percent of the announced amount,” he said. Seventy five percent of the UAE’s announced advertising budgets are real, 70 percent of KSA’s announced budgets are real and 50 percent of Kuwait’s announced budget is real.

The annual expenses of local TV channels are $110 million, while they earn $60 million in income. “TV channels suffer from a $50 million annual deficit,” he said. “This trend is increasing and ongoing due to continuous speculations between channels,” said Makdessi.

According to Pierre El Daher, CEO of the LBCI, there are 960,000 households in the country. Most of them are cable subscribers. If the paid bouquet is applied, TV stations will earn back around $4 million per month, or $48 million per year.

Shawki Bou Assi, Sales Executive at Right & Rights, a local media rights aggregator that sublicenses TV services to other platforms, part of Econet, a local cable provider, said that turning local channels into paid ones is not final yet and they are still exploring opportunities.
Reported by Rana Freifer
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Date Posted: Mar 20, 2015