South Africa’s Showmax tops Netflix in Africa’s market 

An eight-year-old South African streaming company has zoomed past Netflix to become Africa’s favorite. Showmax — which was spun out of Africa’s largest entertainment company, MultiChoice, in 2015 — had 2.1 million subscribers on the continent at the end of November 2023, as compared to 1.8 million for Netflix, according to market research firm Omdia.

The same month, Showmax’s market share rose to nearly 39%, while Netflix dropped to 33.5%. Amazon Prime Video was a distant third contender on the continent with just 300,000 subscribers in November 2023, Omdia noted.

The new Showmax 2.0, launched in February 2024, introduced a revamped app and streaming platform, along with an extensive content slate. Showmax’s pricing in Nigeria includes a General Entertainment package at $2.89 (N2500) per month, a Premier League Mobile plan at $3.35 per month (N2900), and an Entertainment and Premier League mobile bundle at ₦3,200 ($3.70) monthly.

In comparison, Netflix is pricier, with the premium tier at N4,400 per month, the Standard plan at N3600, and the Basic plan at N2,900 per month.

Showmax has overtaken Netflix amid intense competition brewing in Africa’s video streaming industry, where global firms, major telecoms, and several country-specific apps are fighting for consumers’ bucks.

In 2020, Showmax acquired exclusive licensing rights to stream HBO’s content in Africa, which has become one of the biggest advantages for the company. “Although we now watch a few local shows on Showmax, my favorite shows were Billions and Curb Your Enthusiasm,” Johannesburg-based designer Mpumelelo Cindi told Rest of World.

In March 2023, Comcast — the parent company of Universal Pictures, NBC, Peacock, Sky, DreamWorks Animation, and Telemundo — bought a 30% stake in Showmax through NBCUniversal.

This gave the African company access to advanced technology, the funds to survive in a competitive market, and blockbuster English-language content, including titles from the BBC, Lionsgate, ITV, Paramount, Sony, and Warner Bros.

Comcast’s presence will help further strengthen Showmax’s position, CEO Marc Jury told Rest of World. “It allows us to invest in far greater numbers of local productions, and so when you take those local productions, coupled with the international content from around the world and the best of live sport, we know that we’ve got a winner.”

Showmax’s biggest advantage is parent company MultiChoice’s vast network: It runs a cable TV business and has been building TV channels across Africa since 1995, Marie Lora-Mungai, founder of consulting firm Restless Global, told Rest of World.

“Showmax’s biggest advantage is parent company MultiChoice’s vast network. MultiChoice’s level of commitment to building the African video-streaming business from the ground up is a lot deeper than the global players’ need for expansion,” Lora-Mungai said. 

“The African market is essentially MultiChoice’s to lose … It has teams on the ground in most countries, constantly taking the pulse of what audiences want to see. In some places like Zambia, MultiChoice even single-handedly props up the entire audiovisual sector.”

MultiChoice’s revenue in the 2023 financial year was 59.1 billion rand ($3.1 billion) — most of which came from its direct broadcast satellite service, DStv.  Over the years, MultiChoice has leveraged its television business to support Showmax, Thinus Ferreira, a South African media analyst and TV critic, told Rest of World. “DStv is profitable and MultiChoice is able to leverage it to support Showmax through advertising (making people aware of Showmax and its content),” Ferreira said in an email.

He said MultiChoice executives, seasoned in the business, commission most of Showmax’s content. “They don’t have to learn and figure that out in the way that Netflix in Africa and Amazon Prime Video, Disney, Apple TV+ and others must still do,” Ferreira wrote. MultiChoice, which recently rejected an acquisition bid from French media giant Canal+, has said it’s investing another $89 million into Showmax. 

At the beginning of this year, Showmax announced a target of 50 million subscribers and $1 billion in revenue over the next five years.

Experts believe the company will have to exceed expectations on several factors, including its pricing strategy and a smooth relationship with Comcast, to meet this goal. In 2024, Showmax slashed its subscription fee by nearly 50%.

“Showmax wants to grow their subscriber numbers first since that is what investors are interested in, before they then raise their prices, which is what Netflix has also done,” Ferreira said. “Showmax won’t be able to be or to remain this cheap forever but it helps to drive subscriber growth for it now.”

Lora-Mungai said Showmax needs to carefully navigate the risk of its partnership with Comcast not working out well in the long term.

“In practice, this type of global partnership can be tricky,” she said, adding that differences in work culture could lead to disagreements. “Whether Comcast has fully grasped the complexities of doing business in Africa and the patience needed to overcome this market’s challenges remains to be seen.”

Source: Rest of World

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