The recent acquisition of Qanawat Music, a leading digital music and entertainment company in the Middle East and North Africa (MENA) and a subsidiary of Qanawat FZ LLC, by global entertainment and record label Warner Music Group (WMG), is set to boost Dubai’s status as a media industry hub and an emerging focal point for growth in the digital music sector.
One of the largest deals of its kind to date in the entertainment and digital music sectors in Asia, Africa and Europe, the acquisition is also set to provide an impetus to the transformation of the Arab music industry by amplifying the reach of Arabic content from a regional to a global fanbase and providing wider international exposure to Arab talent.
His Highness Sheikh Ahmed bin Mohammed bin Rashid Al Maktoum, Chairman of the Dubai Media Council, said: “Warner Music Group’s acquisition of Qanawat Music is yet another entrepreneurial success story emerging from Dubai that demonstrates the vibrancy of its media ecosystem that has enabled many homegrown ventures to transform their innovative and ambitious projects into reality. Guided by the vision of His Highness Sheikh Mohammed bin Rashid Al Maktoum, Vice President and Prime Minister of the UAE and Ruler of Dubai, the emirate offers a highly productive platform for media talent and enterprise to thrive and grow.”
“Over the past decade, a host of Dubai-born companies across sectors have leveraged the emirate’s exceptional entrepreneurial environment to expand rapidly and attract the investment interest of global companies. Dubai continues to provide the business-enabling services and infrastructure necessary for both established companies and start-ups to tap the vast opportunities emerging in the fast-growing markets in our region,” His Highness added.
Since its inception in 2001, Qanawat FZ LLC has transformed itself from its base in Dubai Media City, MENA’s largest integrated media hub, into the largest Arabic music distributor. In 2021 alone, it recorded more than 200 billion total views and streams across digital streaming platforms, including Apple Music, YouTube, Spotify and Anghami, as well as social media channels such as Facebook, Instagram, TikTok, and Snapchat, with more than 145 million videos uploaded by social network users. Over the last two decades, Qanawat has grown its business to establish a presence in Riyadh, Cairo, Casablanca, Tunisia and Algeria, offering its services in more than 20 countries.
Following the merger, Qanawat Music’s workforce is expected to grow by more than 100%. As per the acquisition deal, Qanawat Music will function as a standalone company within the Warner Music Group portfolio under the continued stewardship of CEO Adnan Al-Obthani. It will be WMG’s key local distributor and a source of upstreaming opportunities, leveraging Qanawat Music’s extensive distribution network and relationship with more than 1,100 emerging and established artists from across the Arab world, including high-profile figures the likes of Hussain Al Jassmi, Ahlam, Saad Lamjarred, Dalia Mubarak and Marwan Khoury.
Adnan Al-Obthani, CEO of Qanawat Music, commented: “Our merger with Warner Music Group makes is possible for us to enhance our position as the leading digital music distributor and pioneers of creativity in the MENA with the largest and best Arabic entertainment and music content worldwide.
We have worked diligently for over 20 years to build an integrated network for distribution and upstreaming, aided by Dubai Media City’s world-class infrastructure and a community that allowed us to find and amplify truly original musical talent. We are passionate about elevating the Arabic music industry and would only partner with a company that we were confident would look after our artists’ best interests. Warner Music Group has a long-term vision for developing the market here in MENA, and we are certain this new chapter of our story will unveil a world of exciting opportunities for artists, in addition to our entry into new areas of business including the Metaverse, NFT and other creative fields."
Majed Al Suwaidi, Managing Director of Dubai Media City, said: “For over 20 years, Dubai Media City has worked to provide the possibilities for growth and success for companies and talents in all fields of media. It is this empowering integrated business ecosystem – represented by Dubai Media City, Dubai Studio City, Dubai Production City and the in5 Media start-up incubator – which has attracted over 3,000 media institutions, 34,000 media professionals to become today a source of Arabic content from Dubai to the world.”
He added: "We never rest on our laurels and will continue to find new ways to attract global companies, and nurture local and regional talent to cement Dubai’s position as a global hub for media and content creation.”
“Qanawat Music has been integral to elevating and broadening the reach of MENA’s music and entertainment community. Its acquisition by a global conglomerate like Warner Music Group demonstrates the growing demand for Arabic and homegrown musicians to have a brighter spotlight.”
WMG president of emerging markets Alfonso Perez-Soto, said: “With this new deal, we have a massive opportunity to export exciting talent from the Middle East and North Africa – there is an important and growing Arab diaspora worldwide that we can tap into, which will help amplify the music.”
Regional music revenue in 2021 is the highest in the world
The Middle East and North Africa region is a burgeoning powerhouse in the music industry, according to the Global Music Report 2022 issued by the International Federation of the Phonographic Industry. The study found that the region witnessed a 35% rise in music revenues in 2021, making it the fasting growing territory of the year, ahead of Latin America, the United States and Canada. With a total population of more than 464 million, the region’s market for music fans is multiplying, fuelled by convenient access to digital streaming platforms and a greater distribution push by regional music companies.
International labels and distributors are taking note of the mounting demand for regional artists as the Arab diaspora grows worldwide. Other major music-related acquisitions within the emirate and wider region demonstrate a significant need for on-the-ground teams to continue scouting out promising artists while maintaining strong ties with renowned figures.