DStv’s existential threat

South Africa&#039;s department of communication and digital technologies recently said streaming services like Netflix and Spotify pose an existential threat to South African broadcasters. “On-demand music and video online streaming services are seriously disrupting the industry globally,” it stated in its annual performance plan for 2024/25. Its remarks come five years after the industry regulator, the Independent Communications Authority of South Africa (Icasa), proposed interventions to break MultiChoice’s dominance in several key areas.The regulator launched an inquiry, which concluded that MultiChoice dominates South Africa’s subscription broadcasting market.It proposed several remedies, including forcing the unbundling of certain high-value sports rights and limiting the number of Hollywood studios with which a broadcaster may have exclusive agreements. It also proposed that satellite decoders should be interoperable with multiple services.MultiChoice hit back at Icasa’s draft findings, launching legal action against the regulator. It warned that over-regulating South African broadcasters would put them at a major disadvantage to international streaming giants Netflix and YouTube.Two years went by, and Icasa reopened the inquiry.Biggest competitorsDuring its 2021 presentation, MultiChoice said global streaming video services were their biggest competitors and “an existential competitive threat".Icasa seemed to take MultiChoice’s submission to heart and rebooted its subscription TV market inquiry in May 2022. Since then, MultiChoice has been coy whenever asked about the threat services like Netflix, Disney Plus and Amazon Prime Video pose.However, it is clearly not sticking its head in the sand.MultiChoice added the ability for subscribers to add Netflix to their DStv bills when it launched its Explora Ultra decoder in 2020.It also has a partnership with Disney Plus. DStv Rewards members were given three months of free access to the service, although this caused some billing problems later.US$1bn revenueResponding to MyBroadband’s questions, MultiChoice acknowledged that streaming services are disruptive and said it was increasing its investment in local content to remain competitive.“MultiChoice is the biggest funder of local content in Africa and produces thousands of hours of local content annually, further expanding our local content library,” it said. “Our customers love to watch stories that resonate with them,” it said.MultiChoice has also been aligning with international media giants to help stand its ground against streaming services.This includes a deal with Comcast’s NBCUniversal that saw the American broadcaster take a 30% stake of Showmax.Showmax was rebuilt from the ground up on NBCUniversal’s Peacock platform and relaunched in January.MultiChoice told investors that Showmax will hit US$1 billion (N$18 billion) in revenue by 2028, with a trading profit break-even target in its 2027 full-year results.

DStv’s existential threat

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Republikein 2025-05-02

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DStv’s existential threat

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