TBI Tech & Analysis: Why MBC took a 30% stake in Greece’s Antenna Group

Hell’s Gate

Middle East broadcast giant MBC Group recently invested almost $240m to take a stake in Greek operator, Antenna Group. Omdia analyst Constantinos Papavassilopoulos explores why and explains how it fits into a broader international strategy.

MBC Group, the largest broadcaster in MENA, acquired a 30% stake in Greece’s largest broadcaster, Antenna Group, earlier this year, investing €225m ($238m) to secure the deal.

Most of the funds will be directed towards the creation of modern, state-of-the-art content production facilities like studios and relevant infrastructure – but why?

For MBC, it is not the size of the Greek market that made investment in Antenna attractive but the fact that Greece has turned itself into a hub for international content production thanks to a generous cash rebate plan put forward by the Greek government.

Legislation introduced in April 2018 facilitates the production of content in Greece by providing a 40% cash rebate for all expenses incurred in Greece while shooting films, series, documentaries or animation.

The rebate scheme also includes post-production costs incurred in Greece and offers financial incentives in the form of a tax relief of up to 30% on all eligible costs incurred while shooting in Greece.

Mutual interests

MBC is the largest content producer in the MENA region, with originals such as Hell’s Gate and remakes of Western shows, including a local reboot of The Office. Omdia intelligence shows that MBC has spent more than $2bn since 1992 on producing or commissioning Arabic-language content.

The company has its own production facilities, spanning across the MENA region in countries like the UAE, Egypt, Jordan and Lebanon. Since January 2020, MBC has been shifting its focus more towards producing content for its standalone SVOD online streaming service, Shahid VIP.

The ambition is to make Shahid VIP the number one Arabic OTT video service in the world. To support this target, MBC is pouring significant amounts of money into producing original Arabic content exclusively for the service, while the Saudi-based group is also inking deals with other content producers in MENA for the exclusive carriage of their works by Shahid VIP.

Omdia’s research shows that MBC is investing between $150m and $180m per year to produce Arabic original content for OTT and is producing between 20 and 30 titles per year. At this level of investment, the company is the undisputed leader in the MENA region. Omdia estimates that MBC is spending almost four times more per year on Arabic originals in comparison with the other major OTT platforms in the region: Netflix, OSN+, StarzPlay Arabia, Jawwy TV and Viu.

Greece is not the only foreign market where MBC has invested: it has also been present in the Turkish market since 2008 when it created one of the largest content production companies in the country, O3 Medya.

For MBC, investment in Greece offers a strategic advantage over its investment in Turkey or MENA: the company, having established a foothold in an EU country, can satisfy any relevant criteria regarding quotas for European productions and thus its own productions can travel freely within the EU.

The excerpt above is taken from an Omdia Analyst Opinion column – available here – and was written by Constantinos Papavassilopoulos, Omdia’s principal analyst for TV & Online Video. Omdia, like TBI, is part of Informa.