Abu Dhabi’s media sector has evolved rapidly in recent years, establishing the emirate as a regional centre for film, television and social media. Sustained government support at both the emirate and the national level has been key to the sector’s success. Carefully calculated promotion has attracted investment and encouraged collaboration in the production of local content in Abu Dhabi’s dedicated media free zone, twofour54. Major developments took place in 2019 in the film and TV broadcast segments, which saw the signing of new partnerships and considerable investment, while the advertising segment followed global shifts placing more emphasis on social media platforms.
Oversight & Regulation
At the national level the National Media Council (NMC) oversees and regulates the UAE’s media sector. Traditional print media as well as newer digital media platforms and film all fall under the purview of the NMC. The council also takes responsibility for issuing licences (including filming permits) to all media institutions; providing general guidelines for content publishing and regulations; developing and growing the local media industry; creating industry jobs; and attracting investment. As part of its efforts to strengthen the sector, in April 2019 the NMC launched the National Programme for Supporting Emirati Films, aimed at developing, promoting and distributing locally produced films and fostering Emirati talent.
There are two primary government-owned media entities at the emirate level whose work feeds into the broader policy vision of the NMC: Media Zone Authority – Abu Dhabi (MZA) and Abu Dhabi Media (ADM). The MZA oversees all regulatory and licensing aspects of twofour54. Its responsibilities include developing and maintaining the media zone’s regulations and licensing, while ADM, the official media organisation of the Abu Dhabi government, operates and manages broadcast, publishing and digital media outlets.
Sector Size
In 2013 the Abu Dhabi Film Commission (ADFC), which falls under the MZA, introduced a 30% rebate of up to $5m on expenses for international production companies that film feature-length movies, TV programmes or commercials in the emirate. Over 90 productions from Hollywood, Bollywood and the Arab world have since been filmed in Abu Dhabi, including box office hits like Star Wars: The Force Awakens, 6 Underground, Mission: Impossible – Ghost Protocol, Sonic The Hedgehog and Bunty Aur Babli 2. The increasing number of productions has put the emirate on the map as a filming and production location. According to ADFC, more than 1bn people have seen the emirate on the silver screen through productions filmed in Abu Dhabi.
The local production industry is also an important contributor to employment and business for ancillary entrepreneurs and small and medium-sized enterprises, such as catering, transport, storage and shipping companies, among others. Taken together, efforts by ADFC and incentives aimed at international companies have added considerable value to the emirate’s wider economy. It has been estimated that for every Dh1 ($0.27) spent by ADFC on incentives, an average of Dh3.10 ($0.84) goes back into Abu Dhabi’s economy.
Media Centre
Through the government’s efforts and investment at the emirate level, Abu Dhabi has emerged as a regional and global competitor in print and digital media. Since its establishment in 2007 ADM has built a considerable media portfolio. From its offices in central Abu Dhabi, ADM operates and manages 24 brands across multiple platforms, including broadcast, print publishing and digital. These include Arabic daily newspaper Al-Ittihad, National Geographic Al Arabiya magazine, and TV channels such as National Geographic Abu Dhabi and Abu Dhabi Sports, in addition to radio and other online content outlets.
While ADM continues to focus on building its brands and growing its digital content, the twofour54 media free zone is at the heart of much of the emirate’s international film and TV production. Since its establishment in 2008, twofour54 has grown into a vibrant media centre, offering 100% foreign ownership, easy registration and licensing, a campus-like collaborative environment, a studio, a 300,000-sq-km backlot (an area where outdoor scenes are filmed) and post-production facilities. In December 2018 Abu Dhabi announced a new batch of foreign direct investment incentives, offering to waive licence and registration fees for new companies and freelancers for two years, which the media zone implemented in 2019.
James Hartt, director of business development and strategy at twofour54, spoke to OBG about the impact incentives have had on business. “By waiving these fees, we have significantly reduced the financial barrier for some businesses. We have since seen twice as many small businesses setting themselves up at twofour54.” Efforts to increase efficiency have also benefitted newcomers, according to Hartt. “Any company with its paperwork in order can set itself up here in twofour54’s media zone in less than 24 hours,” he said.
The media zone now hosts more than 550 media firms and over 700 freelancers. This includes a mix of notable international brands, such as CNN, Red Bee Media, Sky News Arabia and Fox International Channels Middle East, as well as a score of locally owned media companies. “Around 30% of our campus companies are owned and operated by Emiratis, which is significant because UAE nationals are not required under law to operate in a free zone,” Hartt told OBG. “These companies choose to come to twofour54 because they are drawn to a community of like-minded individuals and to the collaborative environment.” The zone is consistently ranked as one of the best broadcast partners in the region, having been named the Broadcast Services Provider of the Year at the ASBU BroadcastPro Summit and Awards two years in row, in 2018 and 2019.
Training & Expertise
Apart from the free zone’s economic contribution, which reached Dh1.5bn ($408.3m) in 2016, twofour54 has also been a major source of job creation and upskilling. As of the beginning of 2019 it had created over 4000 jobs and played a central role in fostering the local talent that has been key to the media zone’s success. Among the initiatives offered as part of twofour54’s wider efforts to foster collaboration is Creative Lab, a 14,000-strong online community that connects students and young creatives with producers and other media experts, while also providing workshops, training and internship opportunities.
In June 2019 twofour54 and Mumbai-based FTC Talent signed a memorandum of understanding that will see the two organisations work together to create new programmes aimed at developing young talent in the emirate’s rapidly growing film industry. The same month, as part of the partnership, twofour54 and FTC Talent hosted a two-day audition-preparation workshop for 50 young, aspiring actors.
The emirate’s film industry is drawing on a growing pool of graduates from media and film programmes, such as those offered by New York University Abu Dhabi (NYUAD). In partnership with local production company Image Nation Abu Dhabi, NYUAD will host the fourth annual Arab Film Studio Young Filmmakers Workshop, a three-week programme focused on developing film-making skills for Emirati students.
Advertising
Challenging economic conditions across the region had a knock-on effect on advertising expenditure, even before the economic disruption of the Covid-19 pandemic in early 2020. Though ad spend has been in decline since 2015, the UAE remains the region’s largest advertising market. In 2018 spending on traditional advertising (not including social media) sat at $1.2bn, down from $1.3bn in 2017, according to multinational media and digital marketing agency Dentsu Aegis Network. Preliminary data from the agency, which was compiled prior to the virus outbreak, suggests that this fell to $1.15bn for 2019, and was projected to drop by an additional 2.1% to $1.13bn in 2020.
Out-of-home (OHH) advertising accounted for the largest share of advertising expenditure in 2018, at 40.8% of the total, or $499.8m, followed by radio (24%), newspaper (19.7%), magazine (7.2%), television (4.6%) and cinema (3.7%). Spending on OHH advertising was expected to increase to $509m by 2020, while newspaper advertising continues to drop rapidly, having fallen from $420m in 2016 to $241m in 2018, and was expected to decline to $154m in 2020.
The UAE’s smartphone and social media penetration rates are some of the highest in the world. In 2019 approximately 99% of the population was active on social media, with 92% of those active connecting via their smartphones, according to a report by Dubaibased media agency The Media Lab. While specific figures for the UAE and Abu Dhabi are not available, it has been estimated that of the combined $3.4bn spent on advertising in the MENA region in 2018, over $1bn, or 40%, was on digital ads on platforms like Google, Facebook, Snapchat, Twitter and Instagram.
Media zones like twofour54 are home to dozens of local and international advertising firms, such as Viola, M&C Saatchi and JCD ecaux. Local companies, too, make considerable advertising expenditure. The UAE’s flagship carrier, Etihad Airways, spends an estimated $30m a year on marketing and advertising.
Broadcast Media
Abu Dhabi and the broader UAE have become a centre for broadcast media as well. Major international news outlets including CNN and Sky News Arabia are based in twofour54, along with 36 others. CNN has been broadcasting live from the emirate since 2009, filming and producing prime-time news programmes such as Connect the World.
Access to twofour54’s advanced production, infrastructure and broadcasting facilities has been a major attraction. In November 2019 Rani Raad, president of CNN International Commercial, told the company’s press room, “Having one of our largest international hubs in Abu Dhabi has been a game-changer for CNN, both commercially and editorially, because it is central to our output and business in terms of both geography and time zone.” ADM continues to invest significantly in TV broadcasting on both locally produced and international content. In April 2019 ADM secured multi-year exclusive broadcast rights for Ultimate Fighting Championship (UFC) in MENA for an undisclosed sum. It then launched the first Arabic-language downloadable app to stream UFC content via its digital subscription service.
Film
The emirate’s film industry has continued to evolve and it now hosts one of the most dynamic film production industries in the region. Over 90 productions have taken advantage of the ADFC rebate and more than 2300 projects have been completed in twofour54 since its establishment. The media zone has also started to invest directly in film and TV productions. In July 2019 twofour54 announced a new partnership with MBC Studios and Image Nation to produce the Arabic-language series Inheritance. The soap opera began airing in March 2020 and has created more than 200 jobs. A dedicated studio was built for the production, which comes as twofour54 prepares to move to a new media technology campus, designed to cater to the creative industries on Yas Island. The premises will feature offices, TV studios, retail space and post-production facilities. In November 2019 twofour54’s post-production facilities became the first in the UAE to receive Dolby Vision certification for technology and tools, which means that twofour54-based producers can now deliver content for major broadcasters such as Netflix, Amazon and Apple TV.
Investment & Collaboration
With its modern infrastructure, business incentives and growing twofour54 zone, Abu Dhabi’s media sector continues to attract foreign investment. Image Nation and the MZA’s work and collaborative partnerships with overseas firms have been to key to the success of the local film industry. Between 2015 and 2020 Image Nation made Dh400m ($108.9m) in investment in the local film and television industry, and inked several strategic partnerships in the film segment in 2019.
In May 2019 Image Nation, MBC Studios and Dubaibased holding company Majid Al Futtaim entered into a new partnership to produce film and TV across the Middle East. The group plans to support several projects annually from inception to distribution, which will provide a significant boost to the region’s growing entertainment industry. The first project, Three for Eternity, is slated for release in 2020.
Outlook
As the media sector in Abu Dhabi continues to mature, much of the focus is on the growing local film industry and twofour54’s new premises. Its space on Yas Island is expected to increase its production and post-production capacity by 30% in order to meet growing demand from film studios. While the degree and length of disruption caused by Covid-19 was still uncertain as of June 2020, several local and international films are set to be shot and produced in the emirate in 2020, which will tap into the growing pool of local talent and expertise. Elsewhere, the focus will be on how to mitigate and adapt to the pressures placed on traditional forms of advertising given the new media dynamics of the digital age. With nearly its entire population active on social media, and a dynamic and well-equipped media zone, Abu Dhabi still has much room for growth and leadership in this segment.
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