A scenario seems to be playing out in South Africa and Nigeria following the recent award bagged by Nigeria as the second most developed Pay TV nation after South African and followed by Kenya. MultiChoice, the operators of DSTv is the key shareholder in the Pay TV industry in Nigeria for more than 10 years with non-existing competition.
The company has deepened its investments and coverage plus subscriber base more than any other country in Africa in the last few years. It is also dominating the ongoing plans to migrate to digital switch over (DSO) with another product called GOTv at the terrestrial level.
The award according to reports revealed that Nigerian Pay TV market is the largest and fastest in return on investments because of the big population and status symbol which are considered by many Nigerians before availability of funds.
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 quick 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.
But the position of the owners of the DSTv in South Africa to the factors considered by the agency to give the award has generated debates among observers.
On the sidelines of the recently held 2016 CNN/MultiChoice African Journalist of the Year Awards in South Africa, CEO MultiChoice Africa, Tim Jacobs, and Managing Director, MultiChoice Nigeria, John Ugbe, took time off to speak with the media on various issues with particular focus on the company’s Nigerian operations at a time of economic recession.
Answering questions on how the current economic downturn in Nigeria affected MultiChoice, Ugbe said “We are facing very tough times and we hope they do not last. MultiChoice offers a lot of international content denominated in dollars which we have to continue offering our subscribers. The naira has been devalued officially by close to 70% – from N200 to N320 – but we all know the reality of the parallel market – the naira doesn’t exchange at N320 to a dollar. We haven’t done any price increase this year since the devaluation of the naira.
“We have been absorbing the costs on behalf of our subscribers. The naira required to pay for the content we buy in dollars has suddenly become so insufficient. Additionally, we can’t even get the dollars to remit. We are lucky that we have a big shareholder, who believes in our business. We haven’t been able to pay our bills for about a year now and have been supported by MultiChoice Africa. Bear in mind that our business is about 24 years old. That’s a mature business and not the kind of business that shareholders should be putting money into.
Continuing he said “ However, we are all very hopeful, as with every Nigerian, that there will be some recovery in the price of oil, so that our economic indices can change quickly, and enable our business recover”.
Adding his voice, the CEO, Tim Jacobs said “When the devaluation happened last year, we increased prices. However, a further devaluation happened about three to four months ago and we did not increase prices”.
