The local television subscription company in South Africa that also supplies Africa recently released their annual figures and surprise surprise they are down. Canal+ the French media giant bought out DSTV/multichoice in October of this year and has seen something that others cannot see. Canal+ is a major entertainment provider across Europe, Africa and Asia. This purchase would have added to the African part of their growth.
When you look at subscriber base, revenues and trading profit they are all down and has been on a gradual slide for the last few years. If it was not for the sports channels they would have been history long ago and has been the part that has saved them.
The numbers are dropping off so quickly with just this year alone seeing a decrease of 1.4 million subscribers. Canal+ say they have a strategy and they must be the only ones who believe they can turn this around as I certainly do not have much optimism.
Over the last 5 years there has been so many competitors joining in with providers like Netflix and Amazon. The problem with DSTV is they were buying the cheap packages overseas that was old content which no one wanted to watch. The reruns of all the old series was unbearable and this lead to people looking elsewhere finding up to date content to watch.
I have a smart television with Cinema as one of my many apps and it provides every series and every film that has ever been produced. Having 10-20 television channels is the dark ages compared to what is available and tech savvy people are moving with the times.
Sport was the only problem for many and if someone like myself has overcome that problem then the 1.4 million subscribers lost this year have also found a way to watch elsewhere. Those subscribers have been lost forever and are never returning.
These numbers above are the entire African user base and revenue so if they grow one market the other markets are all in decline. DSTV announced 4 days ago they were losing roughly 14 channels which was Warner Brothers and History plus Discovery being part of the channel package lost.
Just the South African figures which is the biggest chunk of the customer base 700K were lost last year. The economy is not great and we know roughly 10 million are employed paying taxes in South Africa so how is this base level going to grow if there is such high unemployment levels? The fact is these figures are not going to grow and they are on the way down.
When the economy is bad and the family financials are under stress the first thing that will be cut is the television budget. Maybe some houses think a little differently, but at some point when the choice is food or television food will always win. When I look at DSTV they have priced themselves out of the market with the locals. The only way they could turn this around is if they offered a separate sporting package, but they know this will not happen as every household if the price was right would sign up and not watch any other programs. Unfortunately sport is the most expensive part of the entire program package and this cannot be achieved.