Media companies finally understand: The future of African TV is mobile

By Omar Mohammed –

For a while now, media companies in Africa have been betting that the continent’s growing consumer class will pay for their premium pay-TV services. And for a while now, it’s seemed like a decent bet. Revenue in the pay-TV market across sub-Saharan Africa has nearly doubled since 2010, topping $3.5 billion last year, and by some estimates could reach $6.2 billion by 2020. But by then, much of the market may have already moved on.

In regions where mobile is the dominant device for content consumption, satellite pay-TV services already “are under some pressure,” said Simbarashe Mabasha, co-founder of Wabona, a mobile and online content service provider, in a recent interview. Already in Nigeria, home to Africa’s biggest film industry, consumers are watching videos on mobile devices more than any other platform.

There are about 500 million mobile phone users in Africa, and close to half of these are now estimated to be accessing the internet via mobile broadband services. By 2020, the number of mobile broadband connections on the continent could reach 1 billion.

So it makes sense that media companies will be scrambling to try to reach this audience, distributing content to viewers’ platform of choice instead of waiting for them to come to their pay-TV outlets.

The rise of VOD platforms…

This week, Ericsson, the Swedish-based tech giant, announced the expansion of its VOD subscription service “NuVu” to Kenya next year. The platform, already available as an app on Android for customers in Nigeria, offers 3,000 titles for $5 a month. Also this week, the French media company Canal+ struck a deal with iROKO TV, the Nigerian online content distributor, to launch a mobile-first, Android-based, VOD app to distribute content to Francophone Africa.

“Now that Canal+ is close to having two million pay-TV households in Africa, our ambition is to widen our audience to those whose mobile is the main entertainment device,” Jacques du Puy, president of Canal+ Overseas, said in a statement.

And there are many more outlets—more than 100, according to a recent report in Variety— trying to reach this audience, with VOD platforms targeting the African market. Among them: Naspers, Africa’s largest media company. It has made clear its plans to challenge the likes of Netflix for the continent’s (and the world’s) streaming audience, with mobile VOD at the center of that strategy.

…And the obstacles

But for these platforms to flourish, there are challenges to overcome. One has to do with the price of data.

Currently, video accounts for only 6% of the continent’s traffic. This is mainly due to the fact that broadband connectivity in Africa is still incredibly expensive.

So the success of VOD platforms on the continent hinges on how soon data on the continent gets cheaper. “The cost of data situation is changing, but perhaps it is not changing fast enough,” Mabasha says.

To overcome this, media companies are offering customers, as part of their subscriptions, the option to download content for a limited time. Another tactic involves working with telecom companies to distribute content.

But with with so many options out there for audiences, how these outlets differentiate themselves in the market also will be key.

Source: Quartz


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