Mtv Networks: the Arabian Challenge

ICMR Case Collection Co p y Icfai decoct for Management Research MTV Networks The Arabian contest o D . N ot BSTR294 Teaching Note ? 2009, Icfai pump for Management Research. All rights reserved. No occasion of this publication may be reproduced, stored in a retrieval system, use in a spreadsheet, or transmitted in each class or by any means- electronic or mechanical, with stunned permission. To order copies, jaw +91-40-2343-0462/63 or write to Icfai Center for Management Research, Plot 49, Nagarjuna Hills, Hyderabad viosterol 082, India or email emailprotected rg. Website www. icmrindia. org BSTR/294 MTV Networks The Arabian take exception TEACHING NOTE synopsis Co p y MTV Networks (MTVN) had everyplace the years true a reputation for its capability to fork out topical anesthetic anaestheticized discipline without diluting what MTV stood for. However, the company approach the virtually challenging test in late 2007 with its launch of MTV Arabia in the spunk due east, which some experts considered as the biggest launch in the channels history.While the food market clothe in the marrow eastern offered MTVN with huge opportunities payable to its huge young person populace, MTVs controversial content that was known for angering religious, political, and nonprogressive communities could tardily backfire in the conservative environment frequent in the argona. On the different put crosswise, too much localization to suit the tastes of the region could dilute MTVs planetary brand. The case discusses in detail the system adopted by MTVN to enter and expand in the Middle eastmost and withal the contests go about by the channel. The case will help the students to t TEACHING OBJECTIVES & TARGET AUDIENCE Understand the issues and challenges in entering and expanding operations in new markets which were culturally different from the organizations home base/ handed-down/ alive markets. Understand the pros and cons of entering a ne w market with a regularise/adapted product to suit local preferences. Analyze MTVNs schema in the Middle due east, identify challenges and explore strategies that the channel could adopt in the future D o N This case is meant for students of the MBA/MS take programs in the Business Strategy curriculum.The case is to a fault suitable for conception(prenominal) Business/ foreign Marketing/Brand Management curriculum. TEACHING glide slope AND STRATEGY This case shtup be used effectively in classroom intelligences as well as in distance teaching programs. In the classroom mode, the case moderator can initiate the discussion by giving a brief introduction about the MTV and the channels image in global markets. This can be followed by a discussion on the localization system adopted by MTV in unhomogeneous markets and the challenges it approach plot of land lauching in the Middle easternmost.The students can and take the schema adopted by MTV in the Middle eastside a nd the challenges it faced in expanding its operations in the region. The moderator can take the discussion further with the help of the following questions. 1 MTV Networks The Arabian Challenge 1. Experts felt that hotshot of the biggest challenges faced by MTV period launching MTV Arabia was the prevalent kitchen-gardening in the Arab creation. Discuss the Arab culture. How is it expected to pose a challenge to MTV? 2. Critically dismantle MTVs scheme in the Middle East. chit chat on its introduction strategy and besides its strategy of providing mixed content to the market. Do you deliberate MTV will be able to succeed in this market? Suggested learner Assignment Do a SWOT analysis of MTV Arabia. What should the company do to mitigate the risks while taking advantage of the opportunities presented by the market? analysis 1. Experts felt that genius of the biggest challenges faced by MTV while launching MTV Arabia was the prevalent culture in the Arab world. Discuss th e Arab culture. How is it expected to pose a challenge to MTV?The Arab world contains 22 countries Algeria, Bahrain, the Comoros Islands, Djibouti, Egypt, Iraq, Jordan, Kuwait, Lebanon, Libya, Morocco, Mauritania, Oman, Palestine, Qatar, Saudi Arabia, Somalia, Sudan, Syria, Tunisia, United Arab Emirates (UAE), and Yemen and str and so ones from Morocco across Northern Africa to the Iranian Gulf. The Arab world derives its strategical importance from the fact that around 60% of the body politics oil reserves argon at or virtually the Arabian Peninsula. For MNCs, the Arab worlds teeming younker macrocosm is some other attraction. In the Middle East, 65 percent of the nation be to a lower place 25 years of age.When compared with the demographics in occidental countries, this fact has strong implications for occupationes. N ot The Arab countries are religiously and ethnically diverse. The Arab world is a location of some(prenominal) world faiths (Islam, Christianity, and Judaism) and a multitude of ethnic and linguistic classifys. However, the predominant faith is Islam, and Arabic the dominant address. To be an Arab is a cultural trait kinda than a racial one. Arab history and culture are based on tribalism. close to sides of Arab culture are discussed here Arab Worldview It is based upon six conceptsatomist theory Arabs feed to focus on parts rather than on the whole. They tend to see the world and events as isolated incidents, snapshots, and particular moments in time. corporate trust Arabs usually believe that almost all things in life are controlled by the will of God (fate) rather than by human beings. appetite Vs Reality Arabs express emotion in a forceful and aerial fashion. Their desire for modernity is contradicted by a desire for tradition (especially Muslim tradition). Importance of Justice and Equality Arabs value justice and par among Muslims, and to a lesser tier to others.All actions taken by non-Arabs will be weigh ed against tradition and religious monetary banners. Family Vs Self Arabic communities are tight-knit groups make up of even stronger family groups. Arabs tend to consider family pride and honor more than than consequential than individual honor. Paranoia Many in the Arab world tend to be suspicious of any western sandwich interest in or function on their land. D o 2 MTV Networks The Arabian Challenge Arab tradition Shame and honor Honor, pride, and dignity are at the core of discompose societies, much(prenominal) as the Arabs.For instance, admitting an error or lack of knowledge on a subject is distasteful to an Arab, as any admission of helplessness (muruwwa) is equated with failure to be manly. Constructive blame can, therefore, be taken as an insult. Family The family is the center of honor, loyalty, and reputation for Arabs. Arab families are patriarchal in nature. Personal topographic point It is a high-contact culture. Most Arabs do not share the American/we stern sandwich concept of personal space in public situations, and in occult meetings or conversations. Stepping or leaning away may be taken as an offense.However, the rules are exactly the opposite while dealing with women. socializing and trust Arabs give a lot of importance to hospitality and share plenty of time for refreshment beforehand attempting to engage in business. It is distinguished to first establish respect and trust. When conducting business, it is customary to first shake the hand of all males present, taking care not to grip too firmly. occidental Co p Arab y Arab Perspective Vs. horse opera Perspective Center of e realthing. (Father has first and last word. ) Important but not as underlying to individual. FriendsPeriphery, but courteous to all. Core to some, important to most. Honor Very important amongst Arabs. Honor will be protected and defended at all costs. typically not as important. Shame Shame (especially concerning family) avoided at all costs, insults and criticism taken very seriously. Typically not as important. Time less(prenominal) rigid. Approach to time is much more relaxed and slower than that in westward cultures. Very structured, deadlines must be met. Religion D o N ot Family Central to all things. Varies with individuals, very personal, not discussed in polite conversation.bon ton Family / tribe is most important Individual rights. Government Most governments are secular, but still emphasize religion. Purpose is to protect rights and improve standard of living. Age Age and wisdom honored. Youth and beauty praised. riches Wealth honored in both cultures. Wealth honored in both cultures. Adapted from http//graphics8. nytimes. com/images/blogs/thelede/posts/arabculture. pdf However, it must be emphasized that there is no one Arab culture or society. The Arab world is full of rich and diverse communities, groups, and cultures.Differences inhabit not further among countries, but within countries as well. For in stance, though Arab women are typically subordinate to men in their societies, the extent varies by country. The most restrictive conditions exist on the Arabian Peninsula, and the most relaxed conditions exist in the urban areas of Egypt, Syria, and Lebanon. Moreover, what may be acceptable in cosmopolitan Dubai may not be acceptable in other parts of the UAE. 3 MTV Networks The Arabian Challenge Any discussion regarding the culture of a group cannot get under way without some amount of generalization.However, while generalizations provide some insights on culture, they should be treated with caution and one should steer clear of stereotypes and misconceptions. Many feel that young people irrespective of their culture and nationality confine similar tastes where melody, clothes, computers, and issues with their parents are concerned. For instance, a recent study of Arab and Western jejuneness, carried out by Penn, Schoen, and Berland Associates Inc. and The Nielsen Company, es tablish numerous similarities between the two groups. both Arab and Western youth placed equal importance on family and friends.Their consumer and lifestyle habits were found to be quite similar with both the groups indulging in similar activities, using similar technologies and having similar lifestyle habits. Both maladjusted about their appearances and spent the majority of their disposable incomes on going out and shopping for clothes and shoes. Global brands much(prenominal) as Sony, iPod, Toyota, Nike, Nokia, Toshiba, McDonalds, and Ford were viewed favorably by both the Arab and Western young people, and both viewed Europe as the top desired travel destination. However, the study also revealed certain differences.Some of the key differences identified are given here. Western youth were found to be generally pessimistic about the future, while Middle east youth were generally optimistic. Religion was seen to be enormously important to Middle Eastern youth when compared to their Western peers. National identity and traditional value were entirely important to Arab youth, but not to their peers in the West. For Arab youth, end pointination of traditional values and culture was identified as one of the top triple biggest challenges facing the world today, along with rising cost of living and corruption in government. Arab youth generally admired political, religious, and business cuters, while Western youth do not. Arab youth wanted to make a difference, while Western youth mostly wanted to get ahead. Middle East and Western male youths had very different opinions about gender equality in the workplace, with less than 6 in 10 Middle East males favoring it. 1 o N ot Co p y D MTV and the challenges posed by the prevalent culture MTVN had recognized the huge chance for growth in the Middle East. Considering that MTV was a youth brand, entering the market provided MTVN with the opportunity to tap the teeming youth population in the region.Howev er, the briny challenge the entanglement faced was with regard to its controversial content. Its sexually unmistakable content had created controversies even in the Western markets, considered to be more tolerant. In view of the culture prevailing in the Arab world, the MTV fare was expected to spate up a storm. The culture in the largely Muslim Arab world is conservative. Gender separation is a key aspect of the culture and women are required to maintain their distance from men. Any public display of involvement between men and women is strictly forbidden by the Arab social code.Women have little role in business or entertainment. They are also expected to cover their whole body, head, and face with veils/robes for reasons of modesty. The honor/shame aspect of the culture also implies that people who do not adhere to these rules sire shame to the family/tribe. Arabs have been known to react violently in such situations, with instances of honor killings also being reported. The y also 1 The Global coevals A http//arabyouthsurvey. com/about. html. Cross-Cultural 4 Study of Arab and Western Youth, MTV Networks The Arabian Challenge ake insults and criticism very seriously and can react in an extreme way to what they perceive as an insult. For instance, calling someone a drop behind or exhibit the sole of the feet are considered grave insults and can suggest extreme reactions. So, its not particularly difficult to see why MTV had a major challenge on its hands. Its content (music videos and reality shows) could split the cultural sensibilities of people in the Arab world especially in cost of Excessive skin show Intermingling of genders Use of disparaging or confirm words Off-color or obscene attempts at humor References to inebriant Discussion on religion, politics Gestures such as finger pointing, showing the soles of feet, etc. y ot Co p Another challenge before MTV was that the Arabs were generally considered paranoid by Western standards and they tended to be suspicious of any Western interest. MTV, in a way, stood for what the Arab world most reviled about Western/American culture. While MTV might argue that the values that it stood for were relevant to youth throughout the world, it may still be perceive as something untoward to Islamic ideals and the Arab culture.The launch of MTV in the Arab world could easily be perceived as an im lay of Western culture. Fanatics, or those who pretend to be guardians of Islam, could easily rake up the issue and create a lot of perplexity for MTV. To complicate matters, the anti-American sentiments prevalent in a section of the Arab world too could pose steep challenges to MTV. o N One may argue that with globalization and the advancements in information and communication technology, youth across the globe share similar aspirations and consumption behavior. And that a section of the youth population in the Middle East did want MTV.However, ignoring the cultural differences is f raught(p) with danger, as the Arab youth consider religion enormously important and loss of traditional values and culture as a key challenge. D 1. Critically analyze MTVs strategy in the Middle East. Comment on its entry strategy and also its strategy of providing mixed content to the market. Do you think MTV will be able to succeed in this market? Operating internationally is usually fraught with political, technological, and socioeconomic uncertainties. The risks frame higher when the company is venturing into a market that is very different from its home country/traditional markets.We have already seen that the business environment in the Middle East is very different from that in the Western countries. ingress this market with a brand as controversial as MTV was a huge challenge. Nevertheless, MTVN was able to launch the brand in the Middle East without creating any major controversies and it seemed to be making all the right strategic carry ons. MTVNs extensive consume in operating in the global market came in handy while overcoming the challenges in entering the Middle East. It scanned the market well and decided on an entry strategy in better halfship with a strong local player.With the help of the local partner, it researched the market further to fine tune its strategy. This helped the network gain important consumer insights and also provided it with the opportunity to allay the doubts/fears of the people on the launch of MTV. In doing so, the network recognized the importance of honor and dignity to the Arabs. This was also a goodly move as there is a long-standing tradition based on the Quran and the sayings of Muhammad whereby Arabs consult with senior members of the ruling families and/or the community regarding business decisions. 5 MTV Networks The Arabian ChallengeMTVNs mixed content strategy (combination of music and other content/standardized and localized content) had been quite victorious globally. In MTV Arabia, it localized its o ffering further by offering more Arabic content and also making certain other changes, such as, Minimal use of content that could cause controversy (skimpily-clad women, use of expletives, etc. ). A culturally sensitive team recruited from various countries from the Middle East was given the responsibility of ensuring this. This meant that some of the more controversial programs and videos, which are standard fare in other markets, were not aired on MTV Arabia. Arabic equivalents of popular reality shows were launched with careful consideration of socio-cultural issues. Arabic subtitles were provided for English language content. Considering that Islam was the dominant religion of the Middle East, MTV also gave an animated call for charm during Namaaz (prayer) time. During the holy month of Ramadan, MTV Arabia also dropped its music videos. 2 Religion unremarkably underlies both moral and economic norms. In a region where religion is central to everything, such gestures could cr eate goodwill and insensitivity may lead to extreme reaction. Co p yIn addition to this, MTVN intercommunicate MTV Arabia as an Arab channel by the Arabs, which would help bring to the fore the music talent in the Arab world and also give a vowelise to the Arab youth. It made it clear from an early stage that MTV respected the Arab culture and say that the channel would help debunk various misconceptions regarding Arabs and the Arab world. Its decision to provide the Arab youth with a platform to showcase their talent was a good move considering the Arab youths desire to make a difference. ot The role of the local partner was very important, considering the business environment in the Middle East.The Arab Media mathematical group was very well connected and this helped overcome political and regulatory hurdles to a great extent. It also helped the network gain entrance into Arab homes a place that is considered very private by the Arabs and so get consumer insights. D o N All in all, MTVN had an excellent public dealings strategy and did mega merchandise3 quite well. This not only helped it to tap the growing number of people in the Middle East who were exposed (and accustomed) to the Western lifestyle, but also the huge youth base that had tastes, preferences, and aspirations similar to their peers in other developed nations.MTVNs decision to launch nickelodeon Arabia in 2008 just a few months after the launch of MTV Arabia was another good move. This not only put MTVN in a position to tap the huge population of children in the Middle East, but also helped it strengthen its business relations with the local partner. Needless to say, it also provided MTVN with the opportunity to catch them young. MTV has, thus far, discernd its strategy in the Middle East in a commendable way. In a market that was fed on Arabic pop music, it popularized Arabic hip-hop, a blend of Western-style hip-hop with both English and Arabic lyrics.Its ability to steer clear of co ntroversy is commendable considering the culture in the region. However, while moving ahead, the MTVN faces a number of challenges. The numerous Arab music channels already in the market pose serious challenges to MTV. Many of these channels imitator MTV and have very good knowledge of the market and excellent connections, and in such circumstances MTVs strategy to provide a extremely localized offering can prove to be disadvantageous. There is the electromotive force threat of brand dilution, and MTV Arabia may actually find it difficult to oppose itself.Another problem is the diversity in the Middle East. The network is faced with the question of how to ensure that the youth in Dubai and those in Jeddah relate to it in the same way. 2 3 http//www. arabianbusiness. com/528973-mtv-arabia-to-drop-music-videos-in-ramadan Megamarketing is a term coined by marketing expert, Philip Kotler, to describe the type of marketing activity required when it is necessary to manage elements of the firms external environment (governments, the media, pressure groups, etc) as well as the other marketing variables. 6MTV Networks The Arabian Challenge Notwithstanding the challenges, MTV with its extensive experience in the global market, seems to be in a good position to consolidate its position in the Middle East. It has been associated (positively and negatively) with bringing about changes in the culture in the markets it is aired. It is known to continuously push the limits (albeit in tough ways) of what acceptable content is and what is not. For instance, it started out on a cautious brand in India, a country in which many of the things that MTV stood for were considered taboo.The content it affectedness today in India would have been absolutely unacceptable when it was launched in the 1990s. MTV can do the same thing in the Middle East too. D o N ot Co p y MTVNs strategy in global markets has been to initially tie up with a local partner and in course of time acquire the local company. notwithstanding in this case, MTVN will be well-served if it adopts a more long term relationship with the Arab Media Group. Arabs value justice and equality among Muslims, and to a lesser degree among others. To cite one example, in late 2002, an unidentified man walked into a McDonalds fast food restaurant in Saudi Arabia and manage it on fire.The countrys interior minister was quoted as saying, Its an attack against the property of a Muslim, which constitutes an unacceptable act that we will drive using all possible means. 4 So, the risks associated in doing business in the Middle East could be significantly lower with a local partner. 4 McDonalds Torched in Saudi Attack, www. bbc. c. uk, November 21, 2002. 7 MTV Networks The Arabian Challenge References & Suggested Readings 1. Dirk Smillie, Tuning in First Global TV Generation, The Christian recognition Monitor, June 4, 1997. 2.Kerry Capell, Catherine Belton, Tom Lowry, Manjeet Kripalani, Brian Bremner, an d Dexter Roberts, MTVs World, BusinessWeek, February 18, 2002. 3. MTV to Launch Music TV transmit in Three Baltic States, www. eubusiness. com, March 6, 2006. 4. Faisal Abbas, Q with Showtime Arabias CEO dick Einstein, www. asharqe. com, June 29, 2006. 5. Faisal Abbas, MTV Eyes Middle East Market, www. asharq-e. com, August 8, 2006. 6. Brad Nemer, How MTV Channels Innovation, BusinessWeek, November 6, 2006. 7. Arabian Television Network Partners with MTV to Launch MTV Arabiya, www. ediame. com, December 27, 2006. y 8. Michael Learmonth, MTV Maps Mideast Move, www. variety. com, December 27, 2006. Co p 9. Iain Akerman, MTV Hires Two Agencies for Launch of MTV Arabiya, www. brandrepublic. com, May 23, 2007. 10. Salman Dossari, A Talk With MTV transgression Chairman Bill Roedy, www. asharq-e. com, July 23, 2007. 11. Ali Jaafar, MTV Arabia Ready to Rock Middle East, www. variety. com, September 25, 2007. ot 12. MTV Arabia to be Launched Soon, www. oceancreep. com, October 8, 2007. 13 . Kerry Capell, The Arab World Wants Its MTV, www. businessweek. om, October 11, 2007. N 14. Lynne Roberts, MTV Set for Middle East launch, www. arabianbusiness. com, October 17, 2007. Launch Nickelodeon Arabia, o 15. Stuart Kemp, MTV, Arab Media to www. hollywoodreporter. com, October 17, 2007. D 16. Andrew Edgecliffe Johnson, MTV Targets Muslim Countries as it Tunes in to topical anaesthetic Audiences, www. theaustralian. news. com, October 18, 2007. 17. Arab Media Group and MTV Networks International to Launch Nickelodeon Arabia in 2008, www. ameinfo. com, October 20, 2007. 18. Von Andrew Edgecliffe Johnson, MTV Tunes in to a Local Audience, www. td. de, October 26, 2007, 19. MTV Arabia to Launch November 17, www. middleeastevents. com, October 27, 2007. 20. Ali Jaafar, MTV Arabia Announces Lineup, www. variety. com, October 28, 2007. 21. MTV Arabia to Launch November 17, www. mediame. com, October 28, 2007. 22. Irene Lew, MTV Arabia to Launch in November, www. worldscreen. com, October 29, 2007. 23. Sarah Raper Larenaudie, MTVs Arab Prizefight, www. time. com, November 2, 2007. 24. Jolanta Chudy, MTVs Arab Net Thinking Locally, www. hollywoodreporter. com, November 6, 2007. 8MTV Networks The Arabian Challenge 25. Matt Pomroy, The variation go out be Televised, www. arabianbusiness. com, November 15, 2007. 26. Akon and Ludacris Dazzle The Desert in their Middle East Debuts to Celebrate the Launch of MTV Arabia, www. dubaicityguide. com, November 16, 2007. 27. Adam Sherwin, MTV Arabia to Feature Regional Talent and tonus Down Networks Risque Content, www. timesonline. co. uk, November 16, 2007. 28. Simeon Kerr and Peter Aspden, MTV Arabia Beams Bling to Gulf, www. ft. com, November 17, 2007. 29. MTV Launches New Arabic Service, www. ews. bbc. co. uk, November 18, 2007. 30. MTV Looks to Conquer Middle East Market, www. aol. in, November 18, 2007. 31. MTV Arabia Will It Work? www. scopical. com, November 19, 2007. 32. MTV Aims to Win over Middle East, www . cnn. com, November 19, 2007. 33. Muslim Hip-hop Turban Wrote, Thats Good, www. reuters. donga. com, November 19, 2007. Co p y 34. Barbara Surk, MTV for Young Arab is Less Naughty, www. cincinnati. com, November 21, 2007. 35. Barbara Surk, MTV Launches Arab Music Video Channel, www. theeagle. com, November 22, 2007. 36.Tamara Walid, Finally Got My MTV, www. arabianbusiness. com, November 22, 2007. 37. Will the MTV Brand Change the Middle East? www. brandchannel. com, December 2, 2007. ot 38. Irene Lew, MTVNI Ups Singh, www. worldscreen. com, April 30, 2008. 39. Dana El Baltaji, I Want My MTV, www. arabmediasociety. com, May 11, 2008. N 40. www. topfive. com 41. www. en. wikipedia. org 42. www. mtva. com D Book o 43. www. viacom. com Helen Deresky, International Management Managing Across Borders and Cultures (6th Edition), (Pearson Prentice Hall, Oct 2007) 9