DStv under pressure
DStv is under threat from international streaming services, local competitors, and regulations from the Independent Communications Authority of South Africa (Icasa).
Many South Africans have been up in arms regarding the MultiChoice-owned subscription broadcaster’s pricing and its decision to limit concurrent streams to one user per account.
MultiChoice launched DStv in October 1995, and it has been the dominant broadcaster in the country since.
Despite its dominance, the availability of high-speed broadband connectivity has made online video streaming platforms — such as Netflix and Amazon Prime Video — more accessible to South Africans.
Several international players also made plans to launch their streaming services in South Africa, with Britbox having already launched in August 2021 and Disney+ expected to launch in May 2022.
DStv looked into offering Netflix, Amazon Prime, and YouTube through its Explora decoders as a potential solution to streaming services encroaching on its territory.
However, it soon ran into a barrier in the form of a Competition Commission investigation.
The investigation focuses on integrating popular international streaming services into its DStv Explora decoder, which the commission is concerned may lessen competition.
DStv’s idea was to make itself a one-stop shop where you pay one bill and access all streaming content, including Netflix, Amazon, Hulu, and YouTube.
However, if the findings of the Competition Commission are not in favour of DStv, it will have to scrap its plans.
International players are rapidly occupying the content aggregation arena while the commission dithers and MultiChoice finalises its DStv Streama media box.
In development since at least August 2020, the DStv Streama promises to coherently bring together content across all streaming services.
It will be up against established devices like the Apple TV and freely available software platforms like Plex.
Plex recently announced the launch of its own aggregation interface, offering users universal search across services and a unified watch list.
Samsung smart TV with video streaming apps: YouTube, Amazon Prime Video, Netflix and HBO — Manuel Esteban / Shutterstock.com
DStv’s decision to limit concurrent streams to one user per account did not go down well with its subscribers. Most international streaming services offer at least two simultaneous streams per account.
Streaming providers such as Netflix, Amazon Prime Video, and Britbox have made their services available in South Africa — and they are significantly cheaper than DStv’s Premium package.
For instance, Netflix’s highest-level subscription, Premium, is available to South Africans for R199 per month — 76% less than DStv’s monthly R839 fee for its Premium package.
However, it is crucial to consider that an Internet connection capable of achieving speeds of at least 3Mbps is required to watch Netflix, which adds to the costs.
A recent MyBroadband analysis revealed that South Africans could subscribe to Disney+ and eight other streaming services for less than DStv’s Premium subscription.
Pre-empting this onslaught from subscription video streaming services, MultiChoice launched Showmax in August 2015 — months before Netflix would launch globally.
However, Showmax’s content catalogue is now dwarfed by the likes of Netflix and Amazon Prime Video.
Even DStv’s trump card — sports broadcasting — has come under siege.
Players like Amazon have begun to go after major sports streaming rights. Towards the end of March 2022, a R102-billion battle for cricket streaming rights between Amazon and Reliance Industries kicked off.
The companies are vying for the exclusive rights to broadcast the Indian Premier League — a major cricketing competition.
A recent MyBroadband analysis revealed that DStv’s new single device streaming limit did not align with international sports streaming services. These, too, offer at least two simultaneous streams per account.
Local competition
Local streaming services such as Vodacom Video Play, e.tv’s eVod, and TelkomOne also compete with MultiChoice’s Showmax and DStv streaming products.
While their catalogues may not be as extensive as MultiChoice’s offerings, local streaming services and satellite broadcasters are aggressively targeting less affluent subscribers.
They often compete directly with DStv’s Access, Family, and Compact packages, priced at R115, R295, and R299.
The two subscription broadcasters competing with DStv’s lower-end products are Openview and StarSat.
Openview only charges an up-front installation cost of R1,499 (R549 if you already have a dish) — compared with DStv’s setup cost of R499.
However, Openview viewers would make up the difference in under three years as the broadcaster does not charge a subscription fee.
StarSat, on the other hand, prices its Special, Super, and Max packages at R109, R209, and R299, respectively.
The recent “Must carry, must pay” policy approved by Icasa could also contribute to higher pricing from DStv. It will now have to pay for the South African Broadcasting Corporation’s (SABC) channels that it is forced to carry.
The recently published changes also give the SABC the right to negotiate its carriage charges for such channels.
Advertising regulations
A recent discussion document, published by Icasa, revealed that MultiChoice believes the current regulations surrounding advertising, infomercials, and programme sponsorship are outdated.
“MultiChoice submits that the regulations have been in force for over 20 years, and they are not based on the current environment driven by digital advertising,” MultiChoice said.
“They are based on a world which bears no resemblance to the current digital advertising environment.”
“MultiChoice further states that these restrictions on advertising, infomercials and programme sponsorship are no longer appropriate,” it added.
The broadcasting company is urging Icasa to review the regulations.
MultiChoice also explained how the Covid-19 pandemic had aggravated increasing pressure on the broadcasting industry in South Africa.
“MultiChoice submits that the scourge of COVID 19 pandemic has exacerbated an increasing pressure on the audience fragmentation, competition with unregulated on-demand services, loss of advertising revenue to online advertisers and tough economic and operating conditions,” it said.
The company said that it believes the current regulations restrict a broadcaster’s ability to adapt easily, adding that future amendments to the rules should ease the restrictions on broadcasters.
Now read: Openview launching new channel
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