DStv fighting for survival in South Africa

DStv’s Premium subscriber base was hit hard by Netflix’s launch in South Africa in 2016, but the company is fighting back against the onslaught of international video streaming services.

The pay-TV broadcaster’s results for the 2023/24 financial year revealed that it lost around 1.6 million subscribers across all regions in which it operates.

Although MultiChoice blamed the overall decline on losses in the Rest of Africa, the broadcaster is also haemorrhaging subscribers in South Africa.

As of the end of March 2024, DStv’s active subscribers were 15.7 million — 1.6 million fewer than the 17.3 million it reported for the year ended 31 March 2023. This represents a 9% decline.

MultiChoice explained this was number was heavily influenced by a 13% decline in the Rest of Africa business.

It said its South African business fared better, reporting only a 5% decline in active subscriber numbers.

However, MultiChoice normally focuses more on a 90-day active subscriber figures, which provide shareholders and market observers with a measure of monthly volatility in the subscriber base.

When using this metric, MultiChoice’s 90-day active subscriber base for South Africa declined by 8% over the financial year, from 9.3 million in 2022/23 to 8.6 million in 2023/24.

The broadcaster splits its DStv subscribers into three categories based on the packages they use. These are as follows:

• Mass Market — DStv Family, Access, and EasyView
• Mid-Market — DStv Compact and Commercial
• Premium — DStv Premium and Compact Plus

In the last financial year, the mid-market subscriber base was hardest hit with a 15% decline, while the mass-market segment only experienced a 5% decline.

The Premium segment saw 90-day active subscribers drop by 8% from 1.3 million to 1.2 million subscribers.

Since Netflix launched in January 2016, DStv’s Premium subscriber numbers have faltered.

Between March 2015 and March 2016, the pay-TV broadcaster lost more than 250,000 Premium subscribers.

From a peak of 2.35 million in March 2015, the number slumped to 1.92 million by March 2018.

MultiChoice stopped reporting its Premium subscribers separately in that year and started grouping them with its Compact Plus subscribers in the Premium segment.

However, it is possible to estimate subscriber numbers in the years that followed using MultiChoice’s historical operational information and trends.

The chart below shows MultiChoice’s official Premium-only subscriber declines until March 2018, with estimated numbers for March 2019 to March 2024.

DStv customers are spending less on average despite MultiChoice’s annual price increases due to the decline in subscribers to its most expensive package.

The Department of Communications and Digital Technologies (DCDT) has warned about the threat international streaming players like Netflix pose to traditional broadcasting.

“On-demand music and video online streaming services are seriously disrupting the industry globally,” it stated in its annual performance plan for 2024/25.

However, MultiChoice believes it is poised to lead the streaming industry in Africa with Showmax, which it labels as the “home of local content in Africa”.

“Showmax is designed for our markets and brings our subscribers the continent’s best and most-loved African stories,” MultiChoice said.

“It’s also the home of HBO online in Africa as well as a broad selection of award-winning and blockbuster international movies and series, with an ever-growing catalogue of exclusive Showmax Originals and the best kids shows, as well as live sport from SuperSport on our Showmax Pro package.”

The company has also enabled satellite TV subscribers to access streaming platforms like Netflix, Disney+, and Amazon Prime Video, through their decoder’s interface.

“The introduction of Disney+ continues to keep us top-of-mind for customers looking to continue enjoying our robust local and international content,” it added.