Pay-TV operator MultiChoice will focus on growing the mobile version of its Showmax online streaming platform, in its latest effort to grow revenues outside of its main DStv offering.
In its latest move to increase online streaming subscribers, MultiChoice has launched a new streaming service, Showmax Pro, with live sport, music and news channels. This is an extension of the five-year-old Showmax platform.
“One way of looking at the potential market is to look at smartphone ownership in Sub-Saharan Africa,” Richard Boorman, head of communications at Showmax, told Business Day.
According to the GSMA, smartphone penetration was 302-million in 2018 and is set to rise to 700-million by 2025.
“We’re particularly focused on the mobile version of Showmax Pro to tackle this market — it’s specially adapted for lower data usage and costs half as much as the full version,” said Boorman. “This ties up with our current experience with more than half the viewing hours of Showmax taking place on a mobile device.”
Arthur Goldstuck, technology analyst and head of World Wide Worx, said this is a significant step forward for both MultiChoice and the streaming industry.
“Broadly, it brings the missing link to streaming, namely live broadcasting,” said Goldstuck. “In particular, it takes the English Premier League out of the exclusive domain of pay-TV and adds it to streaming video on demand. This is not a world first, but is still historic. It means that, for those who can afford unlimited broadband, video entertainment is now completely liberated from the decoder.”
MultiChoice does not report on exact users for Showmax, only saying its number of monthly active customers rose 39% year on year for the period to the end of March 2020. This growth was attributed to increased marketing investment, Showmax original programming and local content, which makes up more than 50% of the platform’s library.
The listed pay-TV operator said Showmax Pro will initially be rolled out in Nigeria and Kenya, “with additional countries following shortly after”, including SA.
The entire process is expected to be completed within six to eight weeks with coverage across Sub-Saharan Africa, said MultiChoice.
Unlike how, when some DStv customers also have access to Showmax through their subscriptions, Showmax Pro will not be bundled with any DStv packages.
Peter Takaendesa, a portfolio manager at Mergence Investment Managers, said MultiChoice is continuing to innovate to defend its revenue base and “some of these new products will surely slow the revenue pressure for the group”.
“The challenge will be how to add content to this new offering without cannibalising their traditional Dstv Compact and premium packages,” Takaendesa said, adding that “satellite leases will also remain in place for a while as they are locked in long-term contracts, so it is difficult to reduce platform costs over the mid term”.
He said the price range of R280 to R340 in Nigeria and Kenya looks promising, but SA pricing could be higher.
Showmax Pro is the latest effort from MultiChoice to beef up its online streaming presence in Africa. In addition to Showmax, MultiChoice already has DStv Now, an online version of its satellite subscription service.
In June, the former Naspers company said it would add content from international online streaming giants Netflix, the world’s largest player with 183-million subscribers, and Amazon Prime Video, with more than 75-million users worldwide, in a bid to attract new customers.
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