Middle-Eastern platform Showtime, aiming to hit up to 200,000 subscribers by the end of the year, is now looking to expand, Showtime’s president Peter Einstein talked to Interspace about his plans…

Showtime, the Kipco and Viacom joint venture in the Middle East, expects to break-even during this next year, according to its president Peter Einstein, talking exclusively to Interspace.

Einstein said that Showtime’s multichannel concept is working so well that expansion is now a real option. “Sheikh Faisal [Kipco’s CEO] and I share the vision that [the Middle East] is, has been and will be a great market to be in,” said Einstein. “[As to the future] we could link in a overseas joint venture, perhaps with an existing player who might want access to the Middle East, and where we gain access to the foreign market. Or we could acquire, in markets that are in their infancy or where we might want to embark on a competitive venture.” Einstein said the company was keeping all its options open. “We are over the hump now, charging forward and able to spare some time to examine some of these options,” he said. “We simply look at opportunities inside and outside of the region. Kipco and its board is very much outward in its thinking.”

Showtime’s all-digital MPEG2 bouquet comprises channels drawn from Viacom, including The Movie Channel, MTV and TV Land, plus guest channels like Discovery and Bloomberg. In addition, viewers can access dozens of digital channels from NileSat. Einstein’s extra services will begin to fall into place once NileSat 102 launches this June (current plans see it sharing an Ariane 4 craft with BrasilSat B4).

As to its current status with regard to subscriber numbers, Einstein said the bouquet was on track to hit 175,000-200,000 subscribers by the end of the year. “And real subscriber numbers, not viewing points or any other fudge,” he said, referring to the 400,000-odd “viewing points” number claimed by rival Orbit. Einstein was ecstatic about Showtime’s fourth quarter for 1999. “Those months were the best-ever for Showtime by far. January, which again is traditionally slow, we achieved our January objectives barely half way through the month,” he said. “This year we have a very ambitious target, as we move towards the platform’s break-even. It will be a tight squeeze to achieve it this year. It is possible, but ask me again in September. Whatever happens I’d say 12-18 months from now we will be there.”

Meanwhile Einstein has plans for a clutch of new services to add value to the Showtime bouquet, including Internet via satellite. “We want to add during this next year [services] which exploit our Open TV platform, so I see us incorporating the ShowNet [Internet by satellite] service into the platform,” he said. “Also high on our list is adding interactive and transactional services.” It seems that Showtime now has achieved a critical mass of subscribers that will allow it to run additional services. “And we are also readying ourselves for PPV. I know the market has been talking about this for some time, but we have always held back until we had the right set of numbers,” explained Einstein. “We want it to be an added-value service for viewers. But PPV needs a lot of extra satellite capacity, and if we could partner with NileSat as well as the studios on a transactional basis, then this would be the right step and we are having those discussions now.”

Showtime currently shares certain sporting highlights, mainly built upon English premiership soccer, sharing rights with Arab Radio and Television, the Arabic-language bouquet. But Einstein would now like to extend those viewing options. “Sheikh Saleh’s ART plays an equally important part, and is the foundation for anything we do,” he said. “Looking at sport, and what is really appealing to viewers in the region…let me say that simply putting together a 24-hour channel might be a good marketing proposition but if you break it down to its component pieces we all know that 60 or 70 per cent of that on offer simply isn’t relevant.”

Last year ART/Showtime were outbid by an Abu Dhabi sports channel for Italian soccer rights. Einstein does not regret Showtime’s decision to set a firm limit on the amount it was prepared to spend. He said: “I am speaking to the Sheikh as to how we could move forward on other joint acquisitions, and making sure that the prices are kept sensible. There’s no point in any of us bankrupting ourselves in the ever-rising spiral of sport. We capped our bid for the Italian super league and we were right to do so, not offering prices that were not financially viable. But we will acquire where it takes sense, and whether 12 or 24 hour we will be there, soon.”

Showtime showed the recent Mike Tyson fight but aired the event as part of its regular transmissions. Einstein said: “The Tyson fight went well for us, but while we are still working hard to build our core subscriber base I do not see the next similar event being PPV, not yet. I am not even sure that the last Tyson fight would command the sort of premium activity that event PPV demands. For us event TV might be movie based, or concerts or special events. They could all work.”

But perhaps the most exciting part of Einstein’s planned expansion, at least for his home market, is transactional tele-vision through the Open TV digital architecture.

“We already know there is high Internet traffic going on [in the Middle East], so e-commerce for the thousand and one products that could work in this sector are all interesting to us,” he said. “This is going to be, in my view, an amazing set of services. We might partner with channel-owners where it makes sense, or start our own services. We are not going to ignore business-to-business services, either. We are already getting up to speed, looking at the things that could be done today on the Open TV platform without too much extra effort. Some home shopping, banking, insurance, for example, are all available through Kipco sister companies.”