North Africa, West Asia

Why is the Egyptian state monopolizing the entertainment industry?

Egypt has long been dubbed the “Hollywood” of the Middle East. But with heightened state-imposed restrictions and stifling production circumstances, what is the way forward for the country’s once widely celebrated television and cinema industry?

Yasmin El Banhawy
24 June 2019
Satellite dishes on Cairo rooftops.
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Picture by Moody Man / Flickr.com. Some rights reserved (CC BY-NC 2.0)

The number of Egyptian television series that aired during the peak Ramadan season this year dramatically decreased by half from previous production volumes. Production restrictions and censorship in the most populous Arab country are on the rise, tough circumstances for the entertainment industry, exacerbated by a military-linked production company’s recent monopoly of soap operas. The move also raises concerns about whether a similar fate might be in the works for the film industry.

To make matters worse, the Egyptian cinema and television industry have largely suffered from budget cuts and economic difficulties during the past couple of years, particularly as inflation soared following the float of the local currency in November 2016. Production costs reportedly rose by 50 percent in the mere months thereafter, and inflation levels continue to climb.

In late 2018, a memo circulated to industry professionals by state affiliate Egyptian Media Company (EMC) laid out a set of regulations making it virtually impossible for almost any production company asides from EMC sub arm Synergy Production to produce soap operas in the 2019 Ramadan season. A cap was applied to production costs for soap operas scheduled to air during Ramadan, the shooting cycle was limited to merely 12 weeks, and compensation levels were slashed by upwards of 30%. Although the regulations only apply to the Ramadan season, which this year ran from May 6 to June 4, ambitious television productions historically air during the holy month, as it is the time when advertising revenues soar and viewership levels escalate.

“We have to understand why Synergy is gaining this much control…it’s also very clear that some series [this year] have an almost didactic direction, promoting particular ideas such as improving the image of police officers. Mandating which themes are to be discussed and which won’t be is not censorship, its indoctrination,” Aly Mourad, the CEO of Al Shorouk for Media Productions, tells Open Democracy. “I don’t think we’ve heard of this level of censorship since the time of [Former President] Nasser; it’s like we are going back 60 years in time.”

Though the company has notable credits under its belt, such as the hit 2014 mystery film El-Feil El-Azraq (The Blue Elephant) and the 2010 comedy series A’yza Atgawez (I Want to Get Married), Mourad has taken an indefinite break from the production industry as the challenges to making films and series magnified. “Things are very difficult for producers at the moment, and [state] institutions have made things all the more challenging. It’s not easy to get shooting approvals, and to pass a script through the censors is tougher today than ever,” Mourad explains of circumstances typical even during the off season.

“Many of those who previously worked in the drama industry are sitting at home [jobless], given the decreased volume of opportunities in the industry [due to these restrictions],” says Sabry El Sammak, a prominent artistic producer, explaining how decreasing production volumes and timelines affected personnel across the board, be they technicians, cinematographers, set crew and more. “What I fear is that this pool of currently unemployed talent will switch careers, which will come at the longtime expense of the industry since these are trained professionals. I do not believe that the military [Synergy] sees this; they simply have one clear goal: to control the industry. The government has effectively, through the institutions it runs, carried out the first monopolization process in the history of neoliberalism.”

These relatively new restrictions on drama production raise concerns not only about what is best for industry talent, but also freedom of speech, as the government gains almost single-handed control of what does and doesn’t air on television. The move is also concerning as it is part of a larger clamp down on the arts by President Abdel Fattah El Sisi’s regime.

In April 2017, 3 new government entities were formed under a presidential decree to “reform” the media industry, although many see it as an additional layer of censorship. Publishing or broadcasting materials deemed “harmful to national security” could lead to severe fines, travel bans, or even imprisonment, largely due to wider monitoring measures by entities such as the newly formed Supreme Council for Media Regulation.

In June 2018, the authorities banned a film examining a love affair between a Muslim man and a Christian woman before it hit the cinemas, although director Khaled Youssef said he obtained the necessary licenses. The decision was later revoked, but was alarming to many given rising censorship levels. Throes of poets, writers, satirists, filmmakers and even bookstore owners have been arrested, fined or banned from travel under Sisi’s clampdown on artistic freedom since he took office. The Human Rights Watch dubs this a move “to silence criticism of the government on television and in movies, theaters, and books,” although many of such decisions have little to do with any direct political criticism.

Lebanese indie band Mashrou’ Leila was banned from performing in Egypt after fans attending their last concert in Cairo, in October 2017, waved the rainbow flag in support of the openly gay lead singer Hamed Sinno. In late 2017 as well, the security apparatus canceled two of rock band Cairokee’s concerts in Cairo at the last minute, with little explanation given to the organizers. One of the more recent of such decisions is the indictment of writer Alaa El-Aswany for “insulting” the state. And in April, 34,000 websites were blocked ahead of a constitutional referendum proposing amendments to Egypt’s 2014 constitution, potentially extending the term of President Abdel Fattah El-Sisi to 2030.

“At the moment, we [as artists and directors] face a lot of challenges in terms of political accuracy, whether you’re putting in mind the audiences’ reservations, or the sensitivities of [historic Islamic institution] Al-Azhar. Add to that the subject matter restrictions concerning portraying the police or their families only in a positive light, and there’s so little left to talk about,” argues prominent film director Tamer Mohsen, whose notable credits include acclaimed Ramadan series such as the 2015 Taht el-Saytara (Under Control) and the 2017 Haza el-Masaa’ (Tonight). The prior was celebrated for tackling the drug abuse epidemic across social strata and age groups, breaking taboos on a topic that the media previously turned a blind eye to. “We need to understand the role of the arts; unfortunately, our society does not understand it. Art should not be didactic; art affects and comes from the subconscious…I can understand the current attempts [by Synergy and EMC] to regulate the drama industry given the chaotic production circumstances during the past couple of years, but I have reservations concerning some the recent measures in place.”

Mohsen is known to only participate in a film or TV series release every two years, despite recent industry convention of preparing and shooting a show within a timeframe of less than four months. For many of the shows he has worked on, he spent that much time in just the pre-production and scriptwriting phases, although most television series during the past few years, particularly during the peak Ramadan season, begin shooting before a script is even entirely complete.

Mohsen did not release a TV series this year, he tells Open Democracy, due to the current level of “uncertainty” in the entertainment industry and the “direction that the industry is moving in…It is difficult for me to take on a project when all the circumstances tell me that I will fail.” Criticizing Synergy’s list of production regulations, which arguably might work well to maximize production margins as it slashes production costs, he says, “This is not the right way to decrease costs; limiting costs could be done far more effectively if scripts and production timelines are ready several months ahead of shooting. Through this one change, costs decrease by 30-40%.”

Echoing Mohsen, Al Shorouk’s Mourad laments, “To produce a good show, you really need 7 months at minimum, and that is how things once were [in the 1990s and 2000s]. Today, most shows are written, produced and shot in less than 4 months, which leaves room for a lot of errors.” The situation he complains of was typical even in the years prior to Synergy’s monopoly of Ramadan soap operas. “From a production standpoint, when the norm becomes that you are beginning to shoot merely weeks before Ramadan begins, without even the complete script being drafted because you’re so short on time, planning things efficiently becomes close to impossible. The producer really doesn’t know—for example—which sets or equipment will be used throughout the production timeline.”

While over fifty shows typically aired during the peak Ramadan season, even during economically turbulent years as in 2017 and 2018, only twenty-four shows aired last Ramadan, and over two-thirds of them are produced by Synergy. Production powerhouses like El Adl Group and Beelink Productions were notably absent this season from their regular Ramadan run, while regionally acclaimed megastars like Yossra, Adel Imam and Laila Elwy uncharacteristically did not star in any shows during the peak season either, likely due to the dramatic, forced budget cuts which make casting an A-lister virtually impossible. Compensation levels for many of these lead faces could often be as high as EGP 50 million (~USD 3 million), the currently imposed budget cap for aggregate production costs of a Ramadan soap opera’s full season.

Six key producers and directors interviewed by Open Democracy separately agreed on one thing: Prior to the industry’s current woes, the drama market was saturated with TV series produced during the peak Ramadan season in particular, as the number of shows aired multiplied over the course of the past 10-15 years. The causes for this vary from the rising number of television channels during the early 2000s, creating more opportunities for airing a larger magnitude of shows, to technological advancements facilitating the production process. Viewership opportunities also expanded, as TV audience numbers in Gulf countries grew given rapid urbanization in these areas. Production costs and budgets skyrocketed, a thorny situation when coupled with mounting levels of mismanagement, leading to serious debts for the owners of the television channels and production companies. The explosion of television channels, the hypercompetitive environment between each, the race to choose the right “star” for the next show of the season, and gradual rise of unrealistically short shooting timeframes made the production industry increasingly problematic and taxing.

Tragically, the past couple of years prior to the 2019 season have witnessed time high losses for the production of Ramadan series. “The market collapsed because of large production volumes under uncalculated and unplanned production circumstances,” says producer Ebrahim Hamouda. “For a producer, the direct client of drama series is television channels, and several factors have negatively impacted their purchasing power. The GCC-owned channels are struggling in light of the economic difficulties there, primarily due to the war in Yemen, so the main overseas market for selling television series is not that great. Add to this that privately owned channels in Egypt were never highly profitable, and media budgets generally were slashed with Egypt’s high inflation levels [during the past couple of years], and you have a situation where many production companies are struggling to stay afloat.”

In many ways, the rampant mismanagement and the soaring debts of private channels created the opportunity for the government’s gradual—albeit, indirect—takeover of the country’s entertainment industry, specifically in television. Heightened regulation became justified by the fact that there weren’t structured, well thought-out and clear plans in drama production, particularly for projects set to air during the peak Ramadan season and produced in the mere weeks prior. Over the course of the past year, EMC CEO Tamer Morsy also gradually gained majority ownership of key television networks such as CBC, ONTV, DMC and Al-Hayat, a move facilitated through the recent launch of EMC affiliate United Group for Media Services. Moreover, state-owned entities effectively gained control of both the production and purchasing sides of the business as these unprecedented levels of regulation and government ownership were put in place.

To make matters worse, in early May United Group for Media Services launched paid streaming app WatchiT and prohibited the longtime convention of shows airing online on YouTube for those who couldn’t catch them on satellite television channels. Widely accessed streaming app EgyBest, among other free online streaming services, were also blocked to allegedly mitigate “piracy”, granting government intelligence-affiliated WatchiT a monopoly over streaming services. Since digital finance and financial inclusion levels are low in the most populous Arab country, the decision came to the dismay of throes of viewers regardless of political affiliations or regulation concerns. For those following television series on satellite channels, short broadcast announcements interrupt episodes to denounce a May 28 Human Rights Watch report on enforced disappearances, killings and torture in North Sinai. Other broadcasts order audiences to pay heed to “threats to terrorism and national security.”

“It’s no secret that [Synergy and EMC] have a particular agenda. We all know the type of content they want to create,” producer Hamouda explains, speaking of heightened restrictions to the portrayal of police and army officers in a negative light. Ramadan 2019 soap operas, in true doctrinal fashion, depict the police as brave and heroic in the face of supposed threats to national security through poorly implemented action serials, among other themes concocted by Morsy, EMC and the Supreme Council for Media Regulation. Some critics even say that the themes tackled in this year’s soaps even hold echoes of President Sisi’s speeches, as clear in various scenes airing throughout the season. Acclaimed screenwriter Bashir al-Deek has gone as far as to state that this year’s dogmatic approach to drama has resulted in “severe failures” for the industry, particularly due to the inefficiency of Synergy’s cost deduction approach. One show, Wald El-Ghalaba (Sons of The Poor) starring Ahmed El-Sakka was even accused of plagiarizing the American award-winning series Breaking Bad, with some script lines taken almost verbatim.

WeladelGhalaba.jpg

“Only audiences can decide whether Synergy’s cuts to production timelines and budgets didn’t compromise the quality of soap operas airing…Morsy’s recent ownership of formerly private channels has really changed the industry for good,” Hamouda elaborates. “A competitive environment is usually positive because it promotes risk-taking, and good producers will often take risks if they know that what they are working on is a promising project. Unfortunately, under the current circumstances, if you don’t have a direct contract or agreement with a television channel, or a clear vision for distribution, production becomes difficult.” Hamouda’s production company, Square Media, has managed to stay afloat amid the financial difficulties of the past couple of years by shooting and airing shows during the offseason, such as the 2018/2019 family comedy serial Abou El Arousa (Father of the Bride).

Voicing a similar sentiment, Taht El Saytara’s Mohsen tells Open Democracy, “There's a lot of uncertainty under the current environment, and there’s little room to make any plans for prospective projects when the industry is so volatile. Most filmmakers in Egypt today often speak of the ‘outlook’ and how unclear the ‘outlook’ is, or frustrations concerning whether they might spend time and money producing and shooting a show, only for it to be retracted by the censors.” While in other markets, planning a massive, multi-million dollar project is possible by planning as far as a couple of years before the release, such a setup is nearly impossible in Egypt, he explains, given tightened regulations and security controls.

Sammak also similarly complains, “Because these people [Synergy and EMC] are military men, their mentality is to cut off what doesn’t work, with little concern for the consequences. The military don’t understand or love the arts; they see it as just another industry they can profit off by minimizing losses.” His comments are in reference to the state’s widened control of the private sector, and how military-owned firms have flourished under President Sisi’s regime. “Even the Ministry of Culture’s employees have become little more than mere puppets, tools at the hand of the security apparatus,” he adds, noting how the institution has played a role in the state’s heightened censorship levels.

Until earlier this year, it seemed that regulation, censorship, and military-backed control was unlikely to become typical across-the-board for the film industry, although that slowly became the reality in the television market. Filmmaking in Egypt is not as lucrative as television series, given the high level of advertising revenues offered to satellite channels for a spot on highly grossing soap operas. The profit cycle is far slower for films than for television series, as the box office often covers only a fraction of returns, which often don’t even yield enough for the project to reach the breakeven point. Satellite channels then purchase the films’ viewership rights for as little as EGP 1,600,000 (~USD 100,000), which means it could take film producers several years to generate significant returns on their projects, Youssef Chahine disciple and filmmaker Amir Ramsis clarifies.

Despite some prevailing level of restrictions on the film industry, until recent months some wiggle room in terms of content was more possible for filmmakers as opposed to the screenwriters and producers of television series. In one scene of the 2018 film Leil/Khargi (EXT. Night), frazzled director Moe—played by young actor Karim Kassem—tells a police officer after he’s arrested and about to be released, “Does it matter anyway? In any case, everyone’s imprisoned these days,” a reference to the high numbers of political prisoners in Egypt. The censors surprisingly passed the daring scene before the film’s national box office run, despite the oppositional allusion.

“It’s understandable that they [the military] would be more concerned with penetrating television production as opposed to the cinema industry, because viewership numbers are higher for television series in comparison to films. Not everyone can afford a cinema ticket, but most Egyptians, be they rich or poor, have access to a television set. There’s nothing to stop them from gaining as much control of the film industry as they have with television, but I believe they’re not investing in it [as much] because it isn’t as lucrative,” Mourad tells Open Democracy. A sequel of the 2014 Blue Elephant thriller film, which his company participated in producing, is slated for release later this summer, although it will be produced by Tamer Morsi’s Synergy. Mourad declined to comment on why his company is not working on the project, shrugging much like Mohsen, that there’s “too much uncertainty in the market.”

Egypt’s peak cinema season runs June through to mid-August, the couple of months between Eid al-Fitr and Eid al-Adha when holidaymakers flock to open-air cinemas at beach destinations, young and old audiences gather at indoor, air-conditioned theatres, and a surge in vacation time entails rising box office revenues. But while government control and censorship on films has historically been not as strict as on television, even during the past few months, the announcement of this year’s “summer films” in May causes room for doubt as to whether heavier controls for cinema are on the horizon.

Aside from the Blue Elephant sequel and a couple of other Synergy-produced films slated for release during the season, more than a couple have a strain of nationalism to them. One in particular, war film Al-Mamar (The Passage), stands out, tackling the Arab-Israeli conflict in Sinai during the late 1960s and early 1970s while casting the army as saviors and protectors, undeniably a propaganda stint under President Sisi’s regime. The film is produced by the newly formed United Group for Media Services, sponsored by state intelligence affiliate and telecommunications company WE (formerly branded as Telecom Egypt), and cost an unusually high budget of EGP 100,000,000 (~USD 6,000,000) at a time when most filmmakers struggle to make margins. The subject matter is also not of typical interest to modern-day Egyptian and Arab viewers, who over the past decade have been almost exclusively marketed romantic dramas and El Sobky Films-produced slapstick comedies.

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Despite the financial woes of Egypt’s film industry, there does seem to be a glimmer of hope for its prospective profitability, nullifying former expectations that state control of cinema production could be unlikely given its supposed lacking lucrativeness. Saudi Arabia is once again opening cinema theaters following a 35-year ban, creating a significant potential box office market for Egyptian films, particularly since plans for the inauguration of 2,000 theatres in the kingdom before 2020 are in the works. The local currency is slowly appreciating and stabilizing in value, which may mitigate inflation and make costs more reasonable for filmmakers, particularly as Synergy’s budget cuts set a lower bar in terms of cast and crews’ compensation structures.

As Youssef Chahine disciple Ramsis explains, the conditions imposed by Synergy were in some ways healthy for the market, although that’s unlikely to have been the direct intention. “I think if anything positive has come out of all of this [the restrictions and budget cuts], it’s that the A-listers are being paid more reasonably and that the entertainment industry in general has to find new ways to stay afloat,” he says. Since late 2016, for example, as box office revenues declined in light of rising inflation levels, more filmmakers began considering legitimate online streaming platforms as a serious earnings channel, although this was long prior to the launch of state-owned WatchiT.

“I really believe that what is happening to the entertainment industry in Egypt is a crime; our country was once the Hollywood of the Middle East,” says Sammak, noting the high level of losses many film projects have incurred in the industry’s recent history. “Losses are particularly high in cinema, where some contemporary films have made as little as EGP 2,000,000 (~USD 120,000) in the box office, barely covering costs. Staying afloat in this industry is an incessant challenge.”

To capitalize on making the most of the industry in the way forward, he argues for the importance of competing on a global scale. “Our filmmakers, artists, and actors can definitely compete globally, creating universal stories appealing to audiences no matter their backgrounds, particularly given the rising Arab diaspora in the West, or even Africa and Europe. There was a time when everyone in the Arab world recognized Umm Kalthoum and Ismail Yassin, even more so than [our own president] Nasser. We need to work towards reestablishing that, and understanding how entertainment can be used as a tool for soft power,” the military critic muses.

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