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MOSCOW (Reuters) - Critics may mock the Eurovision Song Contest for being kitsch, but at its core it is a growing business which is now going global.
The Switzerland-based European Broadcast Union (EBU), an association of broadcasters from 56 countries, wants to expand the format for one of the most-watched annual television events in Europe to countries across the world.
Bjoern Erichsen, director of the EBU's TV unit, told Reuters that investors have signed a deal to make a version of the contest -- which pits a musical act from each participating country against the rest -- for the Middle East and North Africa.
He said they were also close to finalizing a deal for a contest called Song of Africa in sub-Saharan Africa.
"They have now paid for the license fee," he said of the Middle East and North African investors. "They should have eight or nine participating broadcasters and that is fine. That's the way Eurovision started and it can grow from there."
He declined to give the exact cost of a Eurovision license fee, but said it was "some hundred thousand" dollars.
The EBU also said it had held talks with investors in Asia, South America and the United States. The investors involved with Song of Africa later said they planned the inaugural contest final in 2011, although a final deal for the Eurovision Song Contest license had not yet been signed.
"It's a sizeable financial commitment but we recognize the global brand," Brenda Devar, a director for Song of Africa, said at this year's Eurovision show in Moscow.
From its beginnings with 14 national competitors in Switzerland in 1956, the Eurovision Song Contest has grown into a massive competition which draws at least 100 million television viewers to a glitzy live broadcast in which spangly costumed finalists belt out their songs, votes are counted and a winner is crowned.
The country with the winning act also becomes the host of the contest for the next year.
This year Moscow has spent a reported $42 million on Eurovision hosting 42 countries in a stadium built for the 1980 Olympic Games. Both the public from across Europe and specialist judges will vote for the winning act in this year's broadcast of the competing finalists Saturday night.
EBU members pay 5 million Swiss francs ($4.5 million) in total toward the competition and the host pledges at least another 5 million Swiss francs and then decides on the rest of the budget.
Erichsen said part of the competition's success has been its rebranding over the decade to shake off a slightly tired look.
"The audience size has doubled and the average age of the audience has come down considerably," he said.
But with participants stretching from the Atlantic Ocean to the former Soviet Union on the Caspian Sea, Erichsen said the Eurovision Song Contest had now reached near maximum capacity.
So the Eurovision Song contest started investing in the TV formatting business which has grown into a 10 billion euro a year industry, Erichsen said, boosted by reality TV show Big Brother and talent competitions Pop Idol and The X Factor.
"When you sell your rights you have to protect them so that you don't get copycats," he said. "We own the rights to an international competition."
Both the EBU and the African investors for Song of Africa said they were near to a deal.
Song of Africa said it was negotiating with African broadcasters and planned to start the competition after the soccer World Cup in South Africa next year.
They plan eight months of national competitions ending with a final in Johannesburg on May 25, 2011 between contestants from a projected nine or ten countries from eastern, western and southern Africa, a show that they estimate will cost between 15-20 million South African rand ($1.7-2.3 million).
But it has been a challenge to put together, Devar said.
"It has been difficult to balance the finances. These are developing economies, this is a developing continent and our currencies are not as strong as the euro," she said.
Editing by Paul Casciato