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Drilling Down at Cannes
Saudi women staff members at a movie theater in Riyadh after opening for the general public, April 30, 2018 (FAYEZ NURELDINE/AFP/Getty Images)
(Photo credit: FAYEZ NURELDINE/AFP/Getty Images)

Drilling Down at Cannes

Martha Bayles

“Entertainment is the new oil.”
— Faisal Bafarat, CEO of the General Entertainment Authority of the Kingdom of Saudi Arabia

The Cannes Film Festival opens today, and there’s a new kid on La Promenade de la Croisette. This past December, the government of Saudi Arabia announced it was lifting its 35-year ban on movie theaters, and that, come spring, the Kingdom would be curating its first-ever pavilion at the grand-père of all film festivals, complete with panel discussions and the screening of five short films by Saudi directors. These changes are part of a long-term plan called Vision 2030, which seeks to diversify the Saudi economy and reduce its dependence on oil.1

Cannes is nothing if not a market, and markets are made up of buyers and sellers. To judge by its official boilerplate, Saudi Arabia is making its debut at Cannes as a seller. In an official statement issued last month, the newly minted Saudi Film Council declared that its presence there will “offer several opportunities for delegates to interact with Saudi filmmakers,” and the head of the council, Minister of Culture and Information Awwad Alawwad, said he was looking forward to “celebrating and supporting the diversity of talent and opportunities within the Saudi film industry.”

This is not the perspective of the biggest seller, Hollywood. To Hollywood, the Kingdom looks more like a deep-pocketed buyer—and this is welcome news after the recent withdrawal of major Chinese investment under President Xi. Hence the red-carpet treatment extended to Crown Prince Mohammad bin Salman during his recent whirlwind tour of the United States. Everywhere the crown prince went, from the swamps of Washington to the uplands of Beverly Hills and the sunny meadows of Silicon Valley, he made deals. In Hollywood, the deals focused mainly on the building of new theaters, but it is clear that the Americans expect those theaters to be filled with Saudis eager to watch the latest Hollywood fare.

Never a major business in Saudi Arabia, the public exhibition of films was banned outright after the 1979 seizure of the Grand Mosque in Mecca by violent jihadis calling for the overthrow of the House of Saud. The rationale for the ban, and for the many other strictures that accompanied it, was that closer observance of Islamic law would mitigate the radicalism behind such terrorist attacks. But the ban makes little sense today, as Saudis of all ages are voracious consumers of entertainment. For the less affluent, and those who came of age during the 1990s, the main source of entertainment is still free-to-air satellite television. The country’s biggest satellite broadcaster, MBC, has eight channels devoted to entertainment, which reach across the entire Arabic-speaking region, from Mauritania to Oman. There are also hundreds of other satellite channels, both free-to-air and paid subscription, to choose from.

The story is different for Saudis under the age of 30, who constitute 70 percent of the population. Like their peers elsewhere, young Saudis have largely abandoned television for online media. A recent survey by YouTube ranked Saudi Arabia among the top countries in terms of “per capita watch-time.” And Saudi Arabia is among the many affluent markets being rapidly penetrated by Netflix and other digital streaming services.

In America, where audiences have become accustomed to having a full menu of entertainment available in the comfort of their homes, the general shift away from theaters is associated with a decline in exhibitors’ revenue. But not in Saudi Arabia. There, it seems, the theater retains its magic. Indeed, Saudis routinely drive long distances to Dubai or Bahrain to binge on movies the way Americans travel to Las Vegas to binge on shows. The sheer novelty of being able to venture out and see a film is expected to attract huge numbers of Saudis—especially teenagers and immigrants from other Arab countries, the Philippines, and South Asia, whose classic complaint (I am told) is, “There’s nothing to do in the Kingdom.”

Reflecting the expectations of Hollywood, the glowing news coverage of this story turned downright refulgent on April 18, when 600 invited guests took their seats in a converted conference hall in Riyadh’s financial district to watch Black Panther, the Disney Company’s hit adaptation of the long-running Marvel Comic series. Crown Prince Salman’s new friends in Beverly Hills did not attend, but they sent video messages saying how “thrilled” and “excited” they were about the event. Minister Alawadd was on hand to greet Adam Aron, the CEO of AMC, the U.S.-based exhibitor that won the first building contract. And Saudi filmmaker Haifaa al-Mansour, who now lives in California, sent a message, saying this “was a day I’ve dreamed of since I was a little girl….It changes everything, for the better, and there is no going back from here.”

I hate to be a spoilsport, but before we break out the champagne, let me offer you a nice cold glass of mineral water. We’ve seen this movie before. And I don’t mean Black Panther. I mean the 2009 story of a dynamic young prince shining a ray of light into the darkness of his cinema-starved country, with the blessing of a forward-looking king who believes it is now time for Saudi Arabia to join the modern world. Only in 2009 the dynamic young prince was Al-Waleed bin Talal, the reformist monarch was King Abdallah, and the breakthrough film was a Saudi-produced comedy, Menahi. Then, too, the public screening of a movie was hailedas “part of King Abdallah’s inclination to promote openness in Saudi Arabia, including in the cultural scene.” But everything did not change for the better.

In the same sober vein, it’s worth recalling that this past November, Prince Al-Waleed bin Talal and dozens of other Saudi billionaires, including Waleed al-Ibrahim, founder and CEO of the MBC satellite network, were confined to the Riyadh Ritz-Carlton for 12 weeks, on vague charges of corruption and with no more due process than has been granted to the hundreds of Saudi human rights activists now languishing in far less luxurious prison cells. If we can just get our heads around the idea of being on lockdown in the Ritz, then we may be able to grasp the point of the exercise, which by all non-official accounts was to torture the captives with room service until they coughed up a collective total of $100 billion.

Now let’s have another sip of cold water and see if we can add two and two.

First, there is Prince Al-Waleed bin Talal, reputed to be worth $18.7 billion when he checked into the Ritz-Carlton. The price he paid to check out is unclear, but in December the Wall Street Journal speculated that it was either $6 billion or “a large piece of his conglomerate, Kingdom Holding Co.” After the prince’s release, Arabian Business reported that he still controlled 95 percent of the conglomerate, which includes the Lebanese Broadcasting Corporation and the Rotana Group, the largest entertainment company in the Arab world. Who knows? Prince Al-Waleed may not be a royal favorite these days (he never was), but he’s probably the only Ritz-Carlton inmate who had a chance of negotiating his own terms.

Then there is Waleed al-Ibrahim, the owner of MBC, which is not just the biggest entertainment network in the Middle East but also the home of al-Arabiya, until recently the region’s most respected news channel. The price of his freedom has been widely reported: the transfer of a 60 percent stake in MBC to Crown Prince Salman and his allies. This is portentous, because while MBC has never been totally independent of the Saudi government, its programming has been generally considered more open and fair than most. Now, amid the hoopla about building new movie theaters, there are mutterings about MBC being re-purposed as the “sole entity” responsible, not just for film distribution inside Saudi Arabia, but for all TV content carried on the MBC satellite to the rest of the Arab world.

According to an article in the Hollywood Reporter by Alex Ritman, the prospect of a single government entity controlling the flow of entertainment into and out of Saudi Arabia is raising concerns among Crown Prince Salman’s new friends in Beverly Hills. Such a move would be “troubling,” says one studio executive, who likened the proposed entity to “the state-run China Film Group,” which (as Hollywood knows all too well) “rules the distribution route.” Ritman quotes another source confiding that the “major studio reps” are “panicking.”

If you’re wondering what all the panic is about, Ritman makes it clear that while some people in Hollywood worry about “how much of films would likely end up on the cutting-room floor given [Saudi Arabia’s] strict sharia laws,” censorship is not the main concern. Instead, the studios are losing sleep over the prospect of “one monopolizing body” being in a position to “dictate financial terms.” In the words of Andrew Cripps, president of international distribution for 21stCentury Fox, “We’re all about the free market and the ability to trade freely….so I think any impediments put in that place would not be particularly welcome.”

It should come as no surprise that Hollywood puts revenue before free expression. For many years now, the U.S. film industry has willingly submitted its products to the scrutiny of state censorship boards in every country on Earth, from the United Kingdom to the United Arab Emirates. And when it comes to Hollywood’s main source of revenue, namely the special-effects blockbuster that costs hundreds of millions to make but (with luck) earns hundreds of millions more overseas, the product is carefully vetted beforehand. If you doubt this, ask yourself how much raw sex and violence can be found in such billion-dollar hits as AvatarTitanicStar Wars: The Force AwakensJurassic WorldMarvel’s The AvengersFurious 7Harry Potter and the Deathly Hallows Part 2—or, for that matter, Black Panther.

But here’s the rub. If the Saudi Arabia story is going to play out in a way similar to the China story, then there may be trouble ahead. The Saudi market is nowhere near as large as the Chinese, but the experts predict it could reach $1 billion by 2030, because the Saudi passion for entertainment is so intense. To return to my initial point, this prediction is based on the perception of the Kingdom as a deep-pocketed buyer, rather than an aggressive seller.

As I have written elsewhere, the same was said about China just a few years ago. Indeed, the Chinese passion for entertainment was the reason why American movies and television were allowed into China in the first place. But while Hollywood rushed in with dollar signs in its eyes, and the rest of America cheered it on, convinced that our movies would play a vital role in democratizing China, the Chinese Communist Party had a different vision. For them, agreeing to be Hollywood’s biggest customer was only the first step in a process that would lead eventually to the construction of a Chinese entertainment industry capable of beating Hollywood at both the domestic and the global box office. If you’re wondering how that works, consider how Facebook and Google were seduced into sharing their technology with Chinese partners who then thanked them very much and threw them out of the country.

As it happens, the global box office still prefers Hollywood blockbusters to lead balloons like last year’s The Great Wall, a $150 million Sino-American co-production about the valiant Chinese army defending the Song Dynasty against a horde of vicious monsters, with the help of two formerly cynical Western mercenaries inspired by the noble Chinese. But having carried the seduction this far, the CCP is now in a position to enlist Hollywood’s help in making domestic propaganda such as last year’s Wolf Warrior 2, a mid-budget action flick about the valiant Chinese army defending a place called “Africa” against a band of vicious American mercenaries. In the first week of its release, Wolf Warrior 2 made $608 million in China and peanuts elsewhere.

Between these two ambitions, that of rivaling Hollywood at the global box office and that of building a domestic entertainment industry capable of strengthening the existing regime, it is hard to imagine Crown Prince Salman harboring the first. But I can easily imagine him harboring the second, especially if that same domestic industry can also, through the skillful deployment of the MBC network, further Saudi hegemony throughout the region. Like President Xi, Crown Prince Salman has zero interest in freedom of expression. On the contrary, he may be seeking Hollywood’s help in fashioning a new kind of propaganda more powerful and persuasive than the old. If Hollywood wants to go along with this vision, then there’s not a lot the rest of us can do to discourage it. But at a minimum, we could refrain from cheering.

1 As described in a recent report from Chatham House, “Vision 2030 implies a degree of social liberalization to enable the growth of the entertainment and tourism industries, as well as extensive reforms to the education system, traditionally a stronghold of Saudi Arabia’s religious clerics. If followed through, this would transform relations between the state and its citizens.”

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