MultiChoice, the parent company of DStv and Showmax, is ramping up its efforts to strengthen its position in the African market amidst potential competition from technology giants like Amazon and Apple.
With a decline in subscriptions to its traditional pay-TV service, MultiChoice sees Showmax as the engine for its future growth.
In a recent statement, MultiChoice board member Andrea Zappia emphasized the importance of Showmax not only as a growth opportunity but also as a means to build resilience.
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MultiChoice aims to maximize the monetization of licensed content and remain in a strong negotiating position for sports rights, ensuring it can offer a competitive live-streaming product.
To bolster its position, MultiChoice announced an agreement with Comcast’s NBCUniversal and Sky to sell a 30% stake in Showmax. As part of the deal, Showmax will switch to using Peacock’s technology, NBCUniversal’s video streaming service.
The partnership with NBCUniversal and Sky is crucial for Showmax’s future success. Outgoing Showmax CEO Yolisa Phahle projected that Showmax would generate R18 billion in net revenue within the next five years.
While MultiChoice recognizes the potential threat from streaming giants like Netflix, Amazon, and Apple, Zappia believes that healthy competition is essential for business growth.
He stated that waking up every morning concerned that someone can be better than you is a driving force for improvement. SuperSport, a subsidiary of MultiChoice, is another key asset that gives the company a competitive advantage.
SuperSport offers a comprehensive range of premium sports content, including the English Premier League and boxing, making it a one-stop shop for sports enthusiasts in South Africa.
This sets SuperSport apart from international broadcasters that often require fans to subscribe to multiple services to access all matches within the same league.
Furthermore, MultiChoice’s ability to accept payments through various mechanisms across the continent gives it an edge. In a region where payment cards are still not widely adopted, MultiChoice’s diverse payment options cater to a larger customer base.
Zappia acknowledges that the world’s biggest tech players may have more lucrative markets to focus on in the short term. However, there is evidence that Amazon has already started turning its attention to Africa.
The appointment of former MultiChoice executive Gideon Khobane as director of Prime Video Africa suggests Amazon’s growing interest in the region.
MultiChoice has set a deadline of 31 March 2024 to unveil Showmax 2.0, which will further enhance its streaming platform’s capabilities and solidify its position in the market.
