Why Netflix has an unfair advantage over DStv – MultiChoice SA CEO
MultiChoice SA CEO Calvo Mawela has defended his view that Netflix has an unfair advantage over DStv in South Africa, and that a regulatory change is needed to address this problem.
MultiChoice recently called on ICASA to ensure the regulatory environment takes the changing entertainment landscape into account.
Mawela told MyBroadband in an interview this week that the current regulatory regime is focused on traditional pay-TV services, and does not look at streaming players like Netflix.
He said the need for a regulatory change to catch up with technological advances was not only the view of MultiChoice, but most local stakeholders.
He highlighted that MultiChoice is adapting to the changing entertainment landscape with its own streaming products, which include Showmax and DStv Now.
Mawela welcomed the increased competition from other players, but said it is not fair that DStv must adhere to numerous regulations – while a competitor like Netflix is unregulated.
The points raised by Mawela include the fact Netflix does not pay local taxes, does not have local employees, and does not have to adhere to local content or BEE requirements.
In a recent interview with the SABC, he said ICASA has also called on local pay-TV players to share their content with third-party platforms like Netflix.
The regulator has, however, not called on Netflix, which spends $8 billion annually on developing its own content, to do the same.
“That gives them a nice advantage to capture the audience,” said Mawela.
“You are strangling us more and more, while you are giving them free rein.”
Consistent message in all markets
Many consumers pointed out that Showmax has the same advantage as Netflix in many markets where it operates, however, and called MultiChoice hypocritical for attacking Netflix while operating a similar service.
Mawela dismissed these allegations, though, saying it has a consistent regulatory message across all markets.
He said MultiChoice is already abiding by all the regulatory requirements in the countries where it operates.
Mawela added that MultiChoice will also call for regulatory frameworks which treat all players equally in these markets.
Jackie Rakitla, general manager of corporate affairs at MultiChoice South Africa, added that their regulatory comments followed a request by the regulator for comment on its plans.
MultiChoice therefore did not proactively ask for Netflix to be regulated, but rather reacted to the regulatory process by ICASA.
Building on DStv Now and Showmax
MultiChoice operates Showmax in Africa and, combined with its DStv Now offering, has a strong position in the streaming market.
Mawela told MyBroadband that a decision on which direction its streaming offerings will take is under discussion at the company.
He said one of the options is to combine Showmax and DStv, and offer a single streaming product – but no decision has been taken in this regard.
Mawela added that they are taking the risk from streaming services like Netflix very seriously and are evolving to embrace technological changes to better serve their subscribers.
He said many of their subscribers prefer streaming over traditional satellite TV, which is why they offer Showmax for free to DStv Premium subscribers.
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