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Multichoice blames Nigeria’s economy for DStv subscriber decline

Multichoice blames Nigeria’s economy for DStv subscriber decline

African pay TV operator Multichoice Group has blamed Nigeria’s economy as active DStv subscribers in the country fell by 18%.

The company said this on Wednesday in its financial result for the year ended March 31, 2024.

It said the decline in Nigeria affected the subscriber base, resulting in a 9% decline for the year.

The total subscription figure for Nigeria was not stated as it is combined with other operating units outside of South Africa labeled as “Rest of Africa” ​​(RoA).

Multichoice reported that the 18% decline in Nigeria reduced total RoA active subscribers by 13% to 8.1 million from 9.3 million in 2023.

“The group’s 9% decline in active subscribers was mainly due to a 13% decline in the Rest of Africa business as mass market customers in countries such as Nigeria had to prioritize basic needs over entertainment, while the South African business has shown more resilience. 5% decrease.

“The Nigerian economy and consumers faced persistent challenges in FY24. The removal of fuel subsidies, the sudden depreciation of the currency, with the official naira halved in value, inflation rising to over 30% and higher emigration of the middle and upper classes led to an 18% decline in active subscribers,” the company said.

Multichoice added that this also reduced Nigeria’s contribution to Rest of Africa revenue from 44% to 35%.

However, it noted that Ghana has seen a similar trend in subscribers given an inflation rate that is still over 20 percent.

Multichoice also said that due to challenging market dynamics, the short-term focus of its business on RoA (Nigeria, Angola, Kenya, Ghana and Zimbabwe) has been shifted from subscriber growth to protect profitability and cash flows.

“Several cost saving initiatives have been implemented, including significantly reducing decoder subsidies (-46% YoY or ZAR 1.3 billion) and reducing selling, general and administrative (SG&A) costs by ZAR 500 million. These interventions have enabled the Rest of Africa company to increase trading profit by 48% per annum to ZAR 1.3 billion,” the statement said.

Recall that before Multichoice’s new subscription prices were implemented on May 1, a Competition and Consumer Protection Tribunal (CCPT) in Abuja issued an order restraining the company from implementing the new prices based on a case filed by a customer Nigerian.

LEADERSHIP reported that Multichoice ignored the court order and implemented the new prices which prompted the Tribunal to fine the company N150 million for challenging the jurisdiction of the court.

The verdict delivered by three members of the commission headed by Thomas Okosu, also ordered Multichoice to give Nigerians a free one month subscription to DSTV and GOTV.