Dot-coms still far from making money
Arab Advisors concludes that the region's dot-coms are still losing money and that a failure to attract women is a key reason.
A new report from Arab Advisors Group has again pointed out a depressing truth, that few of the region’s internet companies make money because online advertising remains dismally low. The research company has one new idea on why that is the case: internet companies fail to attract advertisers' key target audience of women.
“Unlike online ads, satellite TV advertisements have exceeded US $250 million in 2003. This is due to the fact that the satellite audience is greater than internet users. Equally important, satellite TV ads mainly target the female audience, who represent a bigger share of the audience for TV than the audience for Internet portals. Our research shows that the online audience is overwhelmingly male,” say Abed Pharaon and Judeh Siwady, media analysts at Arab Advisors.
“The average share of female internet browsers is around 19%, while the percentage of male viewers is around 81%. Evidently, these figures indicate a strong gender gap in internet usage in the Arab World between females and males.”
The research company believes that the total value of online advertising in the Middle East was a mere $8-10 million in 2003.
Out of all the region’s internet companies, only AME Info and Bayt have told Arabian Business that they are profitable. Maktoob has said in the past that it is at or near the breakeven point.
Arabia.com is singled out in the Arab Advisors report as one dot-com that has bled money. The research company believes that its revenue was barely US $500,000 in 2003, while cumulative losses have now exceeded US $22 million.