Multichoice, Startimes face bigger threat with Netflix entry

Frightened by Netflix’s growing popularity among African
viewers, Multichoice -Africa’s largest television operator, wants the
global streaming platform to be regulated. 

In a report by Quartz Africa, The Chief Executive Officer of MultiChoice, Calvo Mawela blamed Netflix for the loss suffered by the company in the 2017 financial year.

Mawela said more than 100,000 subscribers and
an additional 40,000 were lost to Netflix and in a 2018 interview with
South African Business Day, the Multichoice boss called on regulators to
clamp down on Netflix and other over-the-top services.

Quartz Africa further reports that in a
testimony to the Independent Communications Authority of South Africa,
Mawela said over-the-top service providers like Netflix were already at
an advantage because they did not have to contend with affirmative
action regulations.

Multichoice will face fresh competition from Netflix.

It’s a known fact that Netflix will be concentrating on the shores of Africa in 2019 with Nigeria being on its list.

In the words of Netflix’s vice president of international originals, Erik Barmack,
the company’s Europe team is “in the process of looking at
opportunities in Africa. It’s definitely the case that we’ll commission
some series there in…2019.” 

While Multichoice and Startimes are currently
battling with iROKO, the leading streaming platform for original
Nigerian content, the involvement of Netflix might have spearheaded
another line of competition in 2019.

However, in an interview with Business Insider
SSA, Netflix said thought the company is following Nollywood closely
and focusing more on content, there are no plans to have a physical
office in Nigeria.

‘There are no plans set as yet. We are
following the local industry closely and focusing more on content rather
than physical presence,’ the company told Business Insider Sub Saharan
Africa.

Jason Njoku is the CEO of iROKOtv, Nigeria’s premier streaming platform.

It is believed that the reason for this is to
avoid the seeming difficulties faced by iROKO when it moved its
headquarters from Manhattan to Lagos.

In its bid to operate in the terrain where
Netflix is king, MultiChoice launched a standalone streaming
services, on-demand service ShowMax, and DStvNow. The online services
allow existing subscribers to livestream channels or watch selected
shows on demand.

While spotty internet connections and pricey
data plans have affected iROKO and MulticChoice streaming operations,
Netflix is already looking to help fix the issue and secure a better
connection for its Nigerian audiences.

To this end, Quartz Africa reports, Netflix has deployed a dedicated server in Nigeria in partnership with Spectranet.

The server will hold the entire Netflix
content library and will provide customers in Nigeria with the best
possible video streaming performance.

Following the acquisition of Genevieve Nnaji’s
‘Lionheart’ in 2018, after buying the rights of blockbusters such as
Kunle Afolayan’s ‘October 1st,’ Biyi Bandele’s ‘Fifty,’ it’ without a
doubt that Netflix means business and ready to compete in the Nigerian
market.

The news of Netflix entry has elicited relief
and joy amongst filmmakers and Nigerian movie industry players who seem
to have long endured the hostility of local distributors that held
Nollywood’s economy since its creation.

Chief Executive Officer of Biola Alabi Media,
Biola Alabi told Nairametrics that the involvement of Netflix in the
industry signals a boost for filmmakers and boom for Nollywood.

‘I think it is encouraging and I think it
is a very good sign that the rest of the world is interested in
Nollywood content. This also told me that local investors will miss out
on this big opportunity if they don’t pay more attention. Netflix has a
production budget of $8 billion. That’s just for production of original
content. That’s not talking about acquisitions, or technology because
remember, they’re a technology firm. We’re talking about $8 billion that
is just for producing original content. Our entire film industry in
Nigeria is roughly $1 million. We’re talking about just one company here
and not even including others in the west. So for me, that’s concerning
because if we are not investing in our own stories, our own stories
will then be dictated to us by other people.‘

However, all is not lost for Multichoice, who
will still have three of its indigenous African Magic stations on DSTV
compete favourably.

With indigenous contents of low movie quality
and budget on Africa Magic Yoruba, Africa Magic Hausa and Africa Magic
Igbo, the pay TV company will continue to cater for a part of the larger
market.

Just like Multichoice has invested in
production, Chinese StarTimes have also made a few investments in
Nollywood over the past few years.

The competition which used to be between the
two giant pay TV companies will now be among four major contenders –
Multichoice, StarTimes, iROKO and Netflix.

It is believed that this competition will
probably have a positive impact for viewers across Nigeria including a
possible lower subscription fees for streaming and TV content packages.

While there are also likely to be new
investments in content production and infrastructures, Nollywood films
stand a better opportunity and chance for larger continental and global
exposure.