MultiChoice is piloting weekly subscriptions in Uganda, which if successful will be rolled out to other markets as the company struggles to retain and attract customers.
The company, which operates in 16 countries across Africa, says the objective of the trial is to better align subscription periods with customers’ cash flows.
The pay-TV operator has lost 1.2-million subscribers in the year to March, bringing the number down to to 14.5-million, with the loss evenly split between South Africa and the rest of Africa. Cash-strapped consumers are struggling to keep up with their monthly subscriptions. Over the past two years, MultiChoice has lost more than 1-million South African subscribers.
MultiChoice Group CEO Calvo Mawela said the weekly subscriptions were introduced seven weeks ago and “within three to six months we’ll have a good idea if it’s playing out well”.
“We will then look at other markets to roll this out to. It’s a big change and we think when people are struggling — as we have seen — offering them weekly passes will help in the same way cellphone prepaid has changed the mobile industry,” he said.
Mawela shrugged off the question of whether consumers would in future be able to select their own channels, saying “we still don’t think it works”.
However, he said the company was researching having a base product and adding channels to it, and whether to consider separate sport and general entertainment packages.
“That research is ongoing, and as soon as we have the results and are confident it will generate more revenue and profits, we should be able to trial it.”
MultiChoice continues to report a drop in revenue and earnings as it battles unprecedented headwinds across its markets. Factors are currency depreciation against the dollar in several markets (notably Nigeria, Angola, Ghana and Malawi) and high inflation hurting customer spending.
In South Africa, high unemployment, low economic growth and rising cost-of-living expenses mean households are struggling to make ends meet and have to give up discretionary spending such as their DStv subscriptions, at least for the time being, said MultiChoice.
Mawela said the South African economy could improve in 2025 as inflation eased and the Reserve Bank started lowering interest rates.
MultiChoice is targeting R2bn in cost savings for the 2026 financial year, which Mawela says will come from satellite costs coming down, negotiating better content rates and reducing decoder subsidies
“We think we are stabilising. There is an opportunity for people to have more discretionary spend.”
In Nigeria, the naira had stabilised “and despite us having increased prices by an average of 31% we believe people have adjusted to the new norm, and very soon we'll start seeing them coming back. The worst is over, in my view.”
MultiChoice said it continued to see a shift to streaming as broadband penetration grows, with its DStv Stream recording a 38% rise in subscriber numbers.
However, its stand-alone streaming platform, Showmax, which it co-owns with Comcast NBCUniversal, has lagged its initial growth targets, though it delivered a 44% growth in active paying subscribers and gained market share in the regional streaming market. MultiChoice invested just more than $70m (R1.26bn) about 18 months ago in start-up costs. Showmax was relaunched a year ago.
Mawela said:“We are reviewing the Showmax funding. Despite growth coming through, it’s not as fast as we thought it would be, and as a result we are in discussions with our partners to slow down the [funding] so that it can come back to a place where it’s sustainable. At the moment, we can’t sustain this level, it’s just unaffordable to the group.”
MultiChoice said: “It remains clear that streaming represents the future of video entertainment. Though the levels of broadband and SVOD [subscription video on demand] penetration across Africa are not yet comparable with the rest of the world, they suggest significant long‑term upside. However, data pricing would need to evolve further for this market segment to reach its full potential.”
MultiChoice is targeting R2bn in cost savings for the 2026 financial year, which Mawela says will come from satellite costs coming down, negotiating better content rates and reducing decoder subsidies.
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