MultiChoice preparing to compete with Netflix as profits fall

Competition in the broadcasting and video entertainment space from international online players with global reach – such as Netflix, Amazon, and Google – is increasing, Naspers has said.

To prepare for this, MultiChoice is investing in its online offering, expanding its delivery platforms, and improving products and services, the company said in a summary of its annual results for the year ended 31 March 2015.

While profits at MultiChoice were down, Naspers said that its video entertainment segment produced another consistent performance in the past financial year.

Revenue increased by 17% over the year to reach R42.4 billion, and development spend increased 31% to R2.4 billion as MultiChoice builds out its digital terrestrial television (DTT) services across Africa.

This increase in investment resulted in trading profit contracting by 6% to R8 billion, from R8.5 billion in 2014.

DStv BoxOffice

Transactional video on demand service DStv BoxOffice now sees an average of 600,000 movie rentals per month.

Naspers noted that BoxOffice home movie rentals were made available to all DStv customers in the past year and that the service is now available in 11 African countries.

Subscriber growth

MultiChoice subscriber numbers 2014-15 (April-March)
MultiChoice subscriber numbers 2014-15 (April-March)

MultiChoice added some 727,000 direct-to-home (DTH, or satellite) subscribers to its platforms in Africa, bringing the DTH subscriber base to almost 8 million.

Its DTT network is now operating in 11 countries and 114 cities, and its subscriber base has more than doubled to almost 2.2 million customers.

“Kenya is one of the first African countries to make the transition to digital as the analogue switch-off roll-out began in January 2015,” said Naspers.

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MultiChoice preparing to compete with Netflix as profits fall