The pan-Arab media and entertainment industry, worth $10 billion in 2007, is expected to keep growing at around 19 percent a year, despite a slowdown that has seen publications close and companies cut jobs, consultancy A.T. Kearney said on Monday.
A.T. Kearney said the industry is growing faster than the wider economy and is outperforming Europe and the U.S., where the industry is growing at 3 and 4 percent respectively, powered by a rising young and wealthy population.
The International Monetary Fund on Sunday cut its 2009 economic growth forecast for the Middle East to 2.6 percent.
A.T. Kearney said while the media and entertainment industry struggled worldwide with declining advertising revenue and consumer spending, Middle East consumer spending on media and entertainment was actually on the rise.
However, in Middle East media hub Dubai the advertising industry has been a major casualty of the region's economic slowdown as companies, particularly in the real estate sector, slash marketing and advertising budgets.
Several major media companies - including ITP Publishing, Arab Media Group and City 7 TV - have cut jobs and/or closed publications as they scale back operations to weather the downturn.
A.T. Kearney said the Middle East's underdeveloped media industry was an area governments should look at as they try to diversify their economies away from oil.
“The media industry is a great opportunity for the region to diversify economies and stimulate entrepreneurship leading to small and medium sized companies providing local job opportunities and long-term sustainability and stability for the entire region,” Dirk Buchta, of A.T. Kearney, said in a statement.
A.T. Kearney said the industry also holds potential for foreign investment and new international players.