Aside South Africa, Nigeria has been rated second most developed pay-TV market in Africa.
A report released by leading global market review firm, Frost & Sullivan’s “Pay-TV, Video-on-Demand, and IPTV Growth Opportunities in Africa” studies South African, Nigerian and Kenyan markets.
The report said the pay-TV, video-on-demand (VOD), and Internet Protocol television (IPTV) services market is growing rapidly as significant Internet penetration and smartphone adoption in Africa alter the manner in which consumers view content.
But it was quict to note that growth will be augmented by the availability of cheaper digital terrestrial television services, data-saving video consumption options and attractively packaged triple-play services.
Frost & Sullivan said MultiChoice DStv and GOtv, and StarTimes are among the leading pan-African pay-TV operators, while IROKOtv, ShowMax and Netflix lead the VOD space. It points out that despite DStv’s dominance, South Africa has the most developed pay-TV market, whereas triple-play services are more developed in Kenya.
The report also believed that partnerships between pay-TV operators and telecommunication companies are expected to gain traction as this extends the reach of pay-TV services, while enabling telecommunication service providers to capture new revenue streams.
However, Frost & Sullivan says pay-TV, VOD and IPTV growth opportunities in Africa are hindered by spiralling cost of operations, primarily due to international currency requirements, slow download speed and high costs of Internet access.
But to overcome these challenges, the analyst firm says providers are trying to achieve economies of scale by expanding across the continent and partnering with mobile operators. It believes this will enable subscribers to access content through a small monthly subscription fee while minimising data costs for operators and subscribers.
It points out that innovative pay-TV and VOD providers such as StarTimes, MultiChoice, iROKOtv, Ericsson, Zuku, MTN and Safaricom are prioritising their content strategy according to the preferences of their subscribers, while offering services across multiple platforms such as Web sites, mobile apps and other partner platforms.
