MultiChoice’s multi-billion-rand DStv-replacement plan collapsed in front of everyone’s eyes
MultiChoice’s plan to grow Showmax into an African streaming powerhouse and compensate for declining DStv numbers was a multi-billion-rand blunder.
For two decades after DStv launched in 1995, the service showed exceptional growth, assisted by the decline of the SABC and its pay-TV monopoly.
It was essentially the only game in town if you wanted quality movies and TV series along with the best in live sports.
Year after year, DStv prices increased, and year after year, DStv’s subscribers grew. MultiChoice had a winner, and it printed money.
However, the entertainment landscape in South Africa changed in January 2016 when Netflix officially launched in the country.
People gained access to the latest movies and TV series at a fraction of the price of a DStv subscription.
To ensure smooth streaming, Netflix partnered with the NAPAfrica Internet exchange in Johannesburg, enabling local ISPs to peer directly with Netflix.
The impact was immediate. MultiChoice began losing DStv Premium subscribers with uncapped broadband access. Netflix proved a more attractive option.
The broadcaster attempted to offset these losses by aggressively growing its more mass-market Compact and Access tiers.
However, with the rapid growth of uncapped fibre and 5G access in South Africa, customers on more affordable DStv packages began cutting the cord.
Despite rapid subscriber losses, MultiChoice continued to raise DStv subscription prices each year. The result was predictable.
MultiChoice’s DStv subscribers declined from 17.3 million in March 2023 to 14.4 million by 31 December 2025. All DStv segments were going down.
The core problem was straightforward. DStv faced increased competition from streaming services, which offered a superior value proposition.
MultiChoice’s misguided Showmax strategy
Instead of focusing all its energy on improving its DStv value proposition, MultiChoice went all-in on taking on Netflix.
Former MultiChoice CEO Calvo Mawela said that they would grow their subscriber base to 50 million users in five years.
Showmax was at the centre of this strategy. MultiChoice said it wanted to generate $1 billion, around R18.2 billion at the time, in revenue through Showmax.
MultiChoice significantly ramped up its investment in the Showmax platform and local content to facilitate this growth.
It promised investors that it would have a 3 to 5-year J-curve, similar to its global peers in the streaming industry.
Former MultiChoice executive Yolisa Phahle said they had a trading profit breakeven target for the 2027 financial year.
“We are targeting EBITDA margins of 25% and free cash flow margins of around 20% at scale,” Phahle said.
These plans sounded fantastic on paper. However, as many industry players predicted, they were unrealistic, and MultiChoice did not come close to reaching them.
Instead of the exponential revenue growth needed to reach its $1 billion target, paying subscriber revenues declined in the 2025 financial year.
What was even more painful for MultiChoice was that there was an 88% increase in trading losses in the last financial year.
In the 2025 financial year, Showmax reported trading losses of R4.9 billion, up from R2.6 billion the previous year.
In March 2026, Canal+, which acquired MultiChoice the previous year, announced it would shut down Showmax due to mounting losses.
On Thursday, 30 April 2026, Showmax was shut down, and its content was moved to the DStv Stream service.
Groupe Canal+ chief executive Maxime Saada described Showmax as being an expensive commercial failure.
“As you know, this was a severely loss-making activity on which we saw no recovery, no matter what was done,” Saada said.
Showmax was a misguided strategy by MultiChoice
What stood out about MultiChoice’s Showmax strategy was that many predicted its failure, especially given that other streaming platforms struggled to turn a profit.
Disney+, Warner Bros., Discovery, and HBO Max have faced multi-billion-dollar losses despite reaching significant scale.
CNN+, in turn, was shut down just one month after launch due to a lack of market fit for a niche paid service.
Another challenge was that Showmax faced big US competitors. Netflix, for example, will invest $20 billion (R334 billion) in films and TV series this year.
Showmax counted its total annual investment in its platform in billions of rands, a drop in the ocean of what its competitors are spending.
What was even more telling was that nearly every South African streaming service has failed, irrespective of who was behind it.
MTN launched a streaming service, called FrontRow (later Vu), in December 2014. It shut down in May 2017 due to a lack of demand.
Cell C launched its entertainment platform, Black, in November 2017, but pulled the plug on the service in November 2019.
Vodacom launched its streaming service Video Play in August 2015. It discontinued the service in June 2022.
Telkom launched TelkomONE in November 2020. It canned the project within two years and handed over its platform to the SABC.
There were also many other failures, including the Altech Node, Times Media Group’s Vidi, OnTapTV, and Econet’s Kwesé Play.
Considering the tremendous global competition and graveyard of local services, it is difficult to understand why MultiChoice thought Showmax would be successful.
Loading ...