The Gulf -- The World’s New Media Hub

Philip Stone March 18, 2010 (Follow on Twitter)

Few weeks pass without some major media entity announcing major expansion in the Arabian Gulf region. Last week it was Rupert Murdoch saying News Corp. was centering various Middle East operations in Abu Dhabi, CNN has opened what it calls a state-of-the-art regional center there and already broadcasts a daily news program plus various weekly programs, CNBC has announced it is creating a regional editorial hub in Bahrain and don’t forget the gleaming Dubai Media City that opened its doors in 2001 hosting various international media entities in a tax free zone.

It seems the various Gulf nations have decided it’s prudent not to rely solely on oil revenue – some have much more oil than others – and media is one of those new business environments that seems to have gained diversification favor.

But by basing themselves in the Gulf it seems the cable networks in particular are looking for an advertising bonanza. You can’t turn on CNN International (CNNI) these days, for instance, without seeing multiple ads for various Gulf-area airlines and many Arab-owned entities.  There are many promotions for various events going on in the Gulf area and looking at the list of sponsors for some of those events and it is not unusual to see the CNN logo.

Last week CNNI did major week-long reporting from Bahrain – it even broadcast its usual London-based one-hour primetime Quest Means Business from there – and various Bahraini officials, including royalty, had ample opportunity to give global viewers the positive spin on doing business there. But look at the editorial and advertising in the Quest show when it was back in London Wednesday night for instance, and you wonder just how solid is that Chinese Wall separating advertising and editorial – there were three “Business Friendly Bahrain” spots, there was an interview with the CEO of Gulf Air that is based in Bahrain, and there was a feature about Quest himself going through flight attendant training at the Gulf Air Academy in Bahrain – plenty of branding there. Other ads, incidentally included the Dubai Racing Club and for the Qatar Foundation -- you can definitely see the growing Arabian influence in CNN advertising.

Last week, also, Abu Dhabi hosted the  Laureus World Sports Awards ceremony and CNN send London sports anchor Pedro Pinto not only to cover but to host a CNNI sports panel discussion featuring German tennis great Boris Becker, Brazilian Formula 1 star Emerson Fittipaldi, National Football League star Marcus Allen and former Australia cricket captain Steve Waugh.

You get the definite feeling that CNNI is investing heavily in its brand for the Gulf, it is pulling out all the promotional stops, and it fully expects to see that investment repaid and a lot more besides from additional advertising from the region.

Now comes CNBC saying it is going to create a regional editorial hub in Bahrain which should be operational in Q2 to which Sheikh Mohammed bin Essa Al Khalifa, the chief executive of the Bahrain Economic Development Board (EDB), commented, “For a major media organization to choose us reflects the high priority we place on openness and the steps taken to create an environment conducive to doing business in and from Bahrain.”

But does that openness include true freedom of the press as West Europeans, North Americans and others expect? Rupert Murdoch tackled that issue head-on last week when he keynoted a media conference in Abu Dhabi. “I’d like to say a word about freedom and regulation. This city is the capital of one of the Middle East’s most cosmopolitan societies. Your people have one of the highest GDP’s per capita in the world. And every day you continue to grow – in size, in sophistication, in wealth, and in the attention of the global press.

“With this increased global attention comes the occasional inconvenient or unwelcome story. Again, I speak from some personal experience. Throughout my life, I have endured my share of blistering newspaper attacks … unflattering television coverage … and books that grossly distort my views or my businesses or both.

“I have learned that this kind of coverage is a fact of life in a modern media society. I have learned too that it is the price one pays for success. For a nation, the stakes are even higher. In the face of an inconvenient story, it can be tempting to resort to censorship or civil or criminal laws to try to bury it. This is not only a problem here: In France a criminal defamation law remains in place. In the long run, this is counterproductive. Markets that distort their media end up promoting the very panic and distrust that they had hoped to control.

“Certainly each nation and culture has the right to insist that the people they allow into their countries to do business respect their national values and traditions. This is best administered, however, with a gentle touch. Human creativity flourishes in

freedom.  By making the decision for greater openness, you will signal the importance you have assigned to creativity in your plans for the future – and declare your confidence in your people.”

Murdoch is a man who can put his money where his mouth is. Last month News Corp. invested $70 million in the Rotana Group, controlled by Saudi tycoon Prince Alwaleed bin Tala. News Corp. has a 9% stake in Rotana and the prince’s Kingdom Holding Company has about 7% of News Corp Class B shares.

Getting the Gulf immersed in welcoming additional media entities got its first real stranglehold with the 2001 opening of Dubai Media City which describes itself as “a state-of-the-art media facility” which is still expanding.  At the time Dubai said, “The new facility will afford unheralded levels of freedom to the press, encouraging and facilitating trust.”

So, no longer is Al-Jazeera, with its main company headquarters in Doha, Qatar, the only cable news outfit doing big business in the region. And with oil’s price on the rise again, various governments will have plenty of incentive funds on hand to entice those big media entities that have not yet set up shop to do so, or to expand their current operations in that part of the world.

See also in ftm Knowledge

Rupert Murdoch and News Corporation

News Corporation has a global footprint. Rupert Murdoch has a global fingerprint and when he talks everybody hears it. Update includes News Corporation and News International resturcturing, European television and newspapers. 108 pages PDF (April 2009)

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