Box-office revenue rose to $553 million in the region last year, as the UAE and the KSA drive stupendous growth.
Four Arabian Gulf countries are among the Top 10-ranked countries in the world in terms of the share of premium cinema screens in 2021, according to a research report by Omdia, a global consultancy, that shows the Kingdom of Saudi Arabia (KSA) ranked fourth, followed by the UAE in the sixth position while Kuwait and Oman secured the eighth and 10th positions, respectively.
A growth story
The Middle East has emerged as the fastest- growing cinema industry in the world during the last four years, due to the massive investments in the KSA and the UAE when Covid-19 wiped off $66 billion from global box-office revenues since 2020.
Box-office revenue in the Middle East recovered to $558 million in 2021, although it is still lower than the corresponding figure of $743 million recorded in 2019.
The KSA raked in $238 million in box-office revenue in 2021, followed by the UAE with $140 million. Omdia data shows that the UAE has the highest box-office spend per head of $14 in the region.
The UAE was the largest cinema market in the Middle East before Covid-19 struck — from $262 million in 2019 to $140 million in 2021.
Similarly, the KSA’s was $112 million in 2019, which rose to $238 in 2021. The uptick is attributed to the opening of the cinema industry in the Arabian Gulf’s most-populous nation in 2018 that prompted investors to build cinema complexes across the KSA.
The country’s “Vision 2030” aspires to grow household spending on entertainment from 2.9 per cent to 6 per cent, which in turn is expected to develop a SR30 billion market.
According to Invest Saudi, the local spend on entertainment is $11 billion, while spending abroad on entertainment by Saudi Arabian nationals is $26 billion – more than twice the domestic spend.
Cinema box-office revenues in the Middle East and North Africa (Mena) region are expected to grow by 4 per cent to $1 billion by 2024, compared to a 2.4 per cent decline worldwide, according to a report by global auditing firm PriceWaterhouseCooper (PwC).
The KSA shows the way
By 2024, Omdia estimates there will be 1,400 screens in the KSA, up from a count of fewer than 300 screens in 2020.
The General Commission for Audiovisual Media (GCAM) — one of the governing authorities to regulate and operate cinemas — expects around 350 cinemas and 2,500 movie screens in the country, and the industry will be worth around $1 billion by 2030.
The share of premium cinema screens in the KSA is close to 10 per cent, or one in 10 cinema screens. These belong to the premium category in either of the PLF/4D/IMS formats, for which consumers pay a lot more extra to enjoy the full audio-visual effect of the film.
In the UAE and Kuwait, the share of the premium screens is over 8 per cent, while the global average is much below at 3.4 per cent. This reflects the changing consumer behaviour towards premium cinema experience in the Arabian Gulf.
“Globally, the cinema industry is bouncing back towards recovery from the Covid-19 pandemic and is set to return to the growth mode by 2024,”
according to Maria Rua Aguete, Senior Research Director, Omdia, while addressing delegates during the first day of the two-day Meta Cinema Forum that got underway at Atlantis, The Palm, on Tuesday.
The global trend
The number of cinema screens has grown 3.4 per cent to 212,981 while box-office revenue reached $20.8 billion in 2021, with 3.27 billion admissions to cinema theatres worldwide. Studio revenue reached 10.4 billion last year, which is significantly lower than $26 billion in 2019.
The 13 Middle Eastern countries account for 2,759 screens, which is close to that of Turkey (2.693), amid room for further growth in some of the countries.
Altogether, nine countries in the Commonwealth of Independent States (CIS) house 6,530 screens, with Russia leading the pack (5,725).
In Africa, 41 countries — for which data is available — account for 1,638 screens for over one billion people. South Africa has the maximum number of screens at 658.
China is the largest box-office market in the world, as revenue rose to $7.3 billion last year.
“The global cinema industry will lose approximately $66 billion in box-office revenue between 2020 and 2023, not including cinema concessions – the key profit driver – and screen advertising due to the pandemic. Distributors will lose around half of the gross box-office revenue lost in the Covid-19 gap, or $33 billion,”
Aguete told delegates at the Meta Cinema Forum.
“While some markets are seeing 2019 levels of attendance in patches but not consistently achieving them, some markets are struggling to recover and need structural refresh. The industry is still in the recovery mode and will perhaps recover to the pre-Covid-19 level by 2024, when it starts to grow,”
Meta Cinema Forum
“The cinema industry in the Middle East is outgrowing all other regions in the world, which is reflected in increased industry participation at the fifth Meta Cinema, which is the only convention for the industry for emerging markets.”
Leila Masinaei, Managing Partner of Great Mind Events Management, Organiser of the Meta Cinema Forum
Meta Cinema Forum has been supporting the development of the creative economy that the governments are now promoting. Meta Cinema Forum also boosts the Dubai Creative Economy Strategy that aims to transform the emirate of Dubai into an international destination for creativity and the capital of the creative economy by 2025.
The Dubai Creative Economy Strategy aims to double the contribution of the creative industries to the gross domestic product (GDP) of Dubai from 2.6 per cent in 2020 to 5 per cent by 2025. It also seeks to more than double the number of Dubai-based creative companies from 8,300 in 2020 to 15,000 by 2025, and more than double the number of creators based in the emirate, from 70,000 in 2020 to 140,000 by 2025.
A total of 56 exhibition stands are displaying the latest products, services, new technology from a select group of industry suppliers, technology providers and industry stakeholders at the convention,where more than 44 industry officials and experts are sharing their views through speech, presentations, training and workshops on the current market situation, challenges and ways to overcome them.
More than 500 delegates, visitors, buyers, sellers and other industry stakeholders are participating at the event that is addressing the shortage of feature films, documentary movies and other film genres, among other issues.
The two-day mega cinema industry conference will be followed by a three-day Meta Film Fest that will screen over 70 shortlisted full feature films, documentaries, and short films along with premieres of highly anticipated releases of 2022 at the VOX Cinemas at the Nakheel Mall. Warner Bros, Universal Studio, Empire Entertainment, Film One Entertainment and Tiger Films are among its Studio and Distribution Partners.
Rosy outlook for the Middle East
Middle East $558 million Box-office revenue in 2021
$743 million Box-office revenue in 2019
$1 billion Box-office revenue expected in 2024
$238 million Box-office revenue in the Kingdom of Saudi Arabia (KSA) in 2021
$112 million Box-office revenue in the KSA in 2019
$140 million Box-office revenue in the UAE in 2021
$262 million Box-office revenue in the UAE in 2019
The world 212,981 Number of cinema screens in 2021
$20.8 billion Box-office revenue in 2021
3.27 billion Cinema admissions in 2021
$10.4 billion Studio revenue in 2021
$26 billion Studio revenue in 2019
$1 trillion The projected size of the media and entertainment services market in 2023
$2.6 trillion The projected entertainment industry revenue in 2025
$219 billion Traditional TV/home video revenue
$542.2 billion The projected annual sales revenue of web content, search portals and social media by 2025
$83.3 billion Film and video industry’s projected size by 2025
$79.2 billion The estimated size of the TV broadcasting segment by 2025
News Source: Khaleej Times