| Kippreport.com

Sounds of Saudi

April 18, 2010 3:15 by Rania Habib

It’s been a long time coming; about five years to be precise. But Saudi Arabia has finally started awarding licenses in the kingdom to private radio operators. The latest was awarded just last month; Riyadh Electronic Resources secured the fourth new license this year at a cost of 68 million Saudi riyals.

The whole process is being heralded as the beginning of a new era in Saudi radio, and comes years after companies such as Rotana (also recently awarded a license) began pushing for a more liberal and competitive Saudi radio market.

The first new license was awarded at the end of January to Alf Alf, a Saudi Arabian media company that produces a newspaper and is planning to launch a television station, for the price of 75 million Saudi riyals. The second was granted two weeks later to Ghayat Al Ibdaa Innovation Holding for 66 million Saudi riyals, and the third one in early March to Rotana for 67.35 million Saudi riyals.

The four companies are entering a market that has been monopolized by MBC since 1994, and it’s a change that the media industry is very much looking forward to. “From a buyers’ perspective, the more the merrier,” says Choucrallah Abou Samra, managing director of OmnicomMediaGroup in Jeddah.

Market gains

Mazen Fakhoury, managing director of Mindshare in Saudi Arabia, agrees that the more choices are available, the more interesting work becomes for those in the advertising and communications industry.

“By having a competitive market, we will have more variety of content and much more innovation, and ultimately consumers will gain from that,” he says. “And advertisers will gain by having more options to reach consumers and more interesting ways of reaching them, and from a media buying unit perspective, we have a medium that is going into an interesting phase.”

“This is where you play around with negotiation tactics and you put vehicles against each other,” says Abou Samra. “From a buyer’s perspective, the more you have the more you negotiate, and from a planner’s perspective, the more you have the more it will increase fragmentation. This is where analysis of research becomes critical, to assess which is the best vehicle for reaching your target audience.”

Firas Khashman, general manager of emerging business at Rotana, says he expects that the Saudi radio market will grow rapidly once the new stations begin operating (which is expected to be in about six months), simply because it could not grow while it was dominated by MBC.

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Tags: Alf Alf, Ghayat Al Ibdaa Innovation Holding, MBC, radio, Riyadh Electronic Resources, Rotana