Black was crazy and cost us R1.5 billion – Cell C CEO

Cell C CEO Douglas Craigie Stevenson said for them to think they could compete against players like Netflix in a content play was crazy, which is why they pulled the plug on their Black streaming service.

Cell C launched Black in November 2017 and offered subscribers video streaming, music, concert tickets, and sports betting.

Former Cell C CEO Jose Dos Santos punted the service as the future of entertainment, where you would no longer have to “wait nine months before you can watch the newest movies in South Africa”.

The company also launched a media box, called the blackBOX, which let users access Black streaming services on their TV.

Black was not able to compete against established players like Netflix, and two years after launch the service was shut down.

Craigie Stevenson said Black was not the right play for Cell C because they did not have the resources to compete in that environment.

Speaking on The Nielsen Network this month, Craigie Stevenson said although it was a tough decision to pull the plug on Black, it had to be done.

He said although they had spent R1.5 billion on the Black platform, there was no point in throwing good money after bad.

“You just had to make the decision and cut it,” Craigie Stevenson said.

More operators launching streaming services

Cell C is not the only company to have launched a streaming service only to cut it a few years later.

MTN launched its MTN FrontRow service in December 2014 with a subscription fee of R179 per month.

It later rebranded as MTN VU and the subscription price was dropped to R99 to compete with ShowMax and Netflix.

The service did not gain much traction and MTN VU was shut down on 3 May 2017.

Altech launched its Node video-on-demand (VOD) subscription service in September 2014 at a price of R299 per month.

A year later, Altech confirmed it was pulling the plug on its Node business, citing unfavourable conditions and increased competition.

Times Media Group also tried its hand at a streaming service when it launched Vidi in September 2014 at a price of R149 per month.

It failed to gain significant uptake and Times Media Group cancelled the service less than two years after launch.

The slew of failed streaming platforms did not stop Telkom from launching a new streaming platform called TelkomONE this month.

Telkom partnered with the SABC to offer subscribers over 20 live TV channels, 22 radio channels, 30 music channels, and other on-demand content.

Priced at R49 per month, it is aimed at South Africans looking for local content rather than international shows and movies offered by Netflix.

Cell C CEO Douglas Craigie Stevenson interview

Now read: TelkomONE streaming service – A disappointing mess

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Black was crazy and cost us R1.5 billion – Cell C CEO