Showmax is an expensive failure
MultiChoice’s new owner, Canal+, has described the broadcaster’s over-the-top (OTT) platform, Showmax, as an “expensive failure”.
In a statement accompanying its unaudited full-year results, Canal+ said MultiChoice has faced significant challenges after experiencing impressive growth from 2010 to 2023.
It said these include the combined effects of macroeconomic factors, strong inflation across most cost items, especially content, and a difficult transition to OTT with “the expensive failure of Showmax”.
Canal+ said these factors negatively impacted MultiChoice’s profitability. The French media giant has already moved to eliminate the drain of Showmax.
“We recently announced that we were exiting the loss-making Showmax contract,” it said.
MultiChoice announced its plans to shut down Showmax in early March 2026. The streaming platform was once positioned at the centre of MultiChoice’s growth strategy in Africa.
However, the OTT platform has recorded substantial annual losses, and MultiChoice said it had proved unsustainable in an increasingly competitive and capital-intensive global streaming environment.
“The decision to phase out Showmax reflects our focus on building a sustainable, competitive business for the long term in an increasingly demanding global streaming environment,” it said.
“The decision to discontinue Showmax services will not involve any retrenchments. The Group will be engaging and supporting employees through various transition options.”
The streamer sent an email to subscribers, in which it assured customers that there would be no immediate interruption of its existing service.
“You can continue streaming as usual, and no action is required from you at this time. We understand that this news may raise questions,” Showmax said.
“Showmax subscribers are a priority for us, and we are working on plans to ensure clear communication and a smooth transition when the time comes.”
The letter to customers said it would share further details well in advance, including timelines and any future steps, if required.
R8.7-billion trading loss in three years
Showmax’s financial results for the past few years have been grim. It reported trading losses of R1.2 billion in the 2023 financial year and R2.6 billion in the 2024 financial year.
The trading loss ballooned to R4.9 billion in the 2025 financial year. At the same time, its revenue declined from R1.027 billion to R753 million over the same period.
MultiChoice claimed the decline was only temporary, and it justified the massive financial burden Showmax was saddled with to relaunch the platform by relying on overly optimistic forecasts.
At the time, the broadcaster said that Africa is the final frontier for subscription video-on-demand growth. It said that’s the reason many international platforms were targeting the continent.
MultiChoice believed that Showmax would help it reach a combined subscriber base of 50 million users by 2028.
To leverage the growth opportunity that the broadcaster believed existed, it entered into a partnership agreement and sold a 30% stake in Showmax to Comcast’s NBCUniversal.
The transaction concluded and took effect on 4 April 2023. MultiChoice retained a 70% controlling stake in the streamer.
MultiChoice’s initial projections accounted for Showmax reporting trading losses. It predicted that these losses would begin to decrease in the 2025 financial year. However, the opposite happened.
Another damaging commitment was MultiChoice’s seven-year technology licensing agreement with NBCUniversal to use a Showmax-branded version of the Peacock streaming platform.
According to MultiChoice’s 2024 annual results, it had contracted R6.83 billion in Peacock platform fees.
While these commitments were not yet recognised as obligations in its financial reporting, MultiChoice was contractually obligated to pay them.
By March 2025, the commitments had decreased to R5.819 billion as some obligations were fulfilled, but the remaining liability remained enormous relative to Showmax’s revenue base.
Ultimately, poor leadership and decision-making left Showmax with crippling financial commitments before it had a chance to reach scale.
Showmax trading losses
The chart below shows Showmax’s reported trading losses from 2023 to 2025. The cumulative total for these trading losses over the three years is R8.7 billion.
Loading ...