TV MEA MIPTV 2015

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TVMEA

WWW.TVMEA.WS

APRIL 2015

South Africa / icflix’s Carlos Tibi

MIPTV EDITION

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CONTENTS FEATURE

Paying It Forward

10 SOUTH AFRICA

As new players enter the pay-TV business, TV MEA explores the fast-changing developments in the South African market.

The growth in pay-TV revenues and subscribers may be waning in the U.S. and Western Europe, but the market in subSaharan Africa is booming.

Ricardo Seguin Guise Publisher Anna Carugati Editor Mansha Daswani Executive Editor Kristin Brzoznowski Managing Editor Joanna Padovano Associate Editor Joel Marino Assistant Editor Simon Weaver Online Director Victor L. Cuevas Production & Design Director Phyllis Q. Busell Art Director Faustyna Hariasz Sales & Marketing Manager Dana Mattison Sales & Marketing Coordinator Erika Santana Sales & Marketing Assistant Terry Acunzo Business Affairs Manager

Ricardo Seguin Guise President Anna Carugati Executive VP & Group Editorial Director Mansha Daswani Associate Publisher & VP of Strategic Development TV MEA © 2015 WSN INC. 1123 Broadway, #1207 New York, NY 10010 Phone: (212) 924-7620 Fax: (212) 924-6940 Website: www.tvmea.ws

Recent projections indicate that the region will deliver $6.22 billion in pay-TV revenues in 2020, up from $3.54 billion last year, according to Digital TV Research. The number of subs is set to rise from just under 13 million last year to almost 28 million five years from now. Among the key markets driving that growth will be South Africa, where a host of new platforms are set to take on the dominant MultiChoice and upstart contender StarSat. This edition of TV MEA features an in-depth look at the major transformations taking place in the South African pay-TV business.

In the Middle East and North Africa (MENA), meanwhile, Digital TV Research sees the subs base rising to 21.3 million in 2020, generating revenues of $5.63 billion. It won’t be easy for pay-TV operators though. As of last year, only 18 percent of TV homes in MENA paid for legitimate pay-TV signals. “Piracy remains a major problem, despite many efforts to eradicate it,” says Simon Murray, principal analyst at Digital TV Research. “There are 34.3 million freeto-air satellite TV homes in the Middle East and North Africa sub-regions (excluding Israel, Turkey and Eurasia).

We estimate that at least 10 percent of these homes also receive pirated premium satellite-TV signals. This represents considerable revenue loss to the legitimate players.”

Against that backdrop, icflix is working hard to give customers a reason to pay for content with its over-the-top streaming service. In this edition of TV MEA, founder, president and CEO Carlos Tibi talks candidly about icflix’s challenges, as well as the opportunities for growth as broadband speeds improve.

And yet, even as technology quickly evolves, age-old conflicts remain. At DISCOP Istanbul in February, intractable politics derailed what was supposed to have been a routine pitching session when a panel of Arab judges refused to hear ideas from Israeli producers. “This is a very sad illustration of what we feel [shouldn’t] happen at a platform like DISCOP,” Patrick Zuchowicki, general manager of the event’s organizer, Basic Lead, tells TV MEA. One can only hope that an expanding media universe, delivering a more diverse content offering, can help bring a sense of mutual understanding to communities that have been at odds for far too long.

—Mansha Daswani

10 INTERVIEW

8 icflix’s

Carlos Tibi

The CEO of the platform discusses how his company is enabling MENA audiences to access top-flight content on-demand, on the device of their choosing.

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FremantleMedia International Eye Candy / Deutschland 83 / My Mom Cooks Better Than Yours Based on the best-selling novel from R.L. Stine, Eye Candy is a scripted thriller about a tech genius investigating a deadly cyber stalker. “The series features a very strong cast, is fastpaced and it delves into the modern ‘cyber’ world in a way that I’ve not seen before,” says Anahita Kheder, the senior VP for the Middle East, Africa and Southeastern Europe at FremantleMedia International. Eye Candy is just one of the titles that the company is highlighting for the MEA region at this year’s MIPTV. Another is Deutschland 83, which tells a coming-of-age story set in Germany during the 1980s. “The series is groundbreaking in its captivating and very modern portrayal of history through the eyes of a young Stasi spy,” says Kheder. “It’s fueled [by] secrets, lies, twists and turns.”

Also on FremantleMedia International’s slate is My Mom Cooks Better Than Yours, a culinary game show. “My Mom Cooks Better Than Yours is one of my favorite formats in our catalogue,” says Kheder. “With the combination of cooking, family relationships and a ticking clock, it’s truly entertaining for the whole family. The format is flexible for schedules and fun for the viewers, and it’s already taking the world by storm. We completed a deal for the format with TRT in Turkey, which has since placed an order for additional episodes, and we’re looking forward to securing further deals with broadcasters across MEA.”

“Clients are always looking for cost-effective formats that can deliver pure entertainment and audiences— My Mom Cooks Better Than Yours is [one of them].”

—Anahita Kheder

My Mom Cooks Better Than Yours

SDI Media Dubbing / Subtitling / Access services SDI Media offers clients a complete end-to-end localization solution for feature films, episodic television series, interactive games, digital media and corporate needs, using the most comprehensive suite of customizable localization software applications in the industry. With the world’s largest owned-and-operated network of facilities, incorporating 150-plus recording rooms and more than 85 mixing rooms, SDI Media provides dubbing, subtitling, access services and other media solutions in more than 80 languages worldwide, servicing 40 markets in 37 countries across EMEA, Asia and the Americas. “As a proud member of the Netflix Preferred Vendor (NPV) program, SDI Media provides clients with a trusted resource for creating and delivering foreign-language audio, subtitles and video to Netflix,” says Roy Dvorkin, the senior VP of global business development and client services at SDI Media. “In addition, SDI Media localizes many of the Netflix originals and has created a global team that exclusively services Netflix to support its continued growth strategy in new territories. We would like producers and distributors to know that SDI Media has global resources available to handle any Netflix needs with dedicated managers across all Netflix distribution territories.”

“Along with our expanded service offerings, SDI Media continues to increase its global footprint.”

—Roy Dvorkin

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reports for the UAE that said that 70 to 80 percent of customers used their credit cards for online [purchases], but in reality we have only seen around 15 percent do so. Most of the credit card holders we have met are expats who have come to Dubai with their credit cards from back home and are hesitant to use those cards for local purchases. That was in its own way a challenge. The other challenge was dealing with local payment gateways. We developed our own payment gateway to address the local markets across the MENA region. Now, for every market we have localized payment instruments and have resolved credit card issues. Another challenge involved content. Although icflix had a fairly large library of content, we were not completely sure what people’s tastes were and what age groups would be interested [in the service]. We had an idea that it would be the younger generation, but then when we launched we saw it was not just the younger crowd; the older generation was also interested, because of Jazwood.

TV MEA: How have you seen the service grow since launch?

TIBI: Since our launch two years ago, we have already [signed up] more than 200,000 subscribers across the

ICFLIX CARLOS TIBI

By Mansha Daswani

Based in Dubai, icflix launched in 2013 as the first unlimited streaming platform exclusively targeted to the Middle East and North Africa (MENA). The service, founded by president and CEO Carlos Tibi, has been steadily expanding across the region over the last two years, licensing a host of local and international content and recently embarking on an original programming drive. Tibi tells TV MEA about how he is positioning icflix in the burgeoning OTT landscape and enabling MENA audiences to access top-flight content whenever they want, on the device of their choosing.

TV MEA: What prompted you to want to launch icflix?

TIBI: While [living] in the U.S., I felt this pent-up demand for Arabic content. You couldn’t find it anywhere, and if you did, it would be chopped up into different pieces, so you had to watch the first half [of a show] and then the other. Everyone was asking if they could have something like Netflix but in Arabic, so I thought, Why don’t we do something with Arabic content? It was during my time in the U.S. that I came up with the idea for icflix, an entertainment platform that combined Hollywood, Bolly wood and Jazwood, which is a term we coined to represent Arabic cinema and programming.

TV MEA: What were the greatest challenges you had to face in setting up the platform?

TIBI: From the time of our launch and ever since, we have learned a lot about the market. No one had done anything like this from the region, and we did not know what to expect. We knew there was a demand for the service and the content, but once we launched we had to face a lot of hurdles—some of them [involved] localization and others the monetization of content. We read a lot of industry

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region, and that number grows by around 15 percent each month. Initially, 60 percent of icflix’s content was consumed on PCs and a mere 6 percent on smart TVs. Now that the cost [of connected-TV sets] is declining, PC usage recently dropped to 48 percent and smart TVs are capturing around 15 percent. With mobile devices readily available and extremely intelligent to stream content, and with the screens becoming larger with every new release from the major mobile manufacturers, consumers are more inclined to leverage their devices as their personal video viewing instruments. As a result, we are seeing a big jump in access from mobile devices. To broaden accessibility further, icflix will soon be available on Xbox One and PlayStation 4, allowing users to access the service through their gaming platforms.

TV MEA: In which markets have you seen the strongest take-up?

TIBI: Nearly 40 percent of the subscriber base is in the UAE, followed by Saudi Arabia and Egypt. Morocco, Algeria and Tunisia are also important markets for us.

TV MEA: Where do you see the greatest opportunities emerging this year and next?

TIBI: Faster internet speeds. Our technology has been adapted to go as low as 256 Kbps [0.25 Mbps; in more mature markets, average broadband speeds range from 10 to 20 Mbps].

We have created special profiles for markets like Africa where broadband speeds are not very high. We use our own in-house compression technology based on adaptive streaming to make it easier and less expensive for the user when it comes to internet usage.

TV MEA: What led to the launch of pay-per-view (PPV) offerings alongside the streaming subscription?

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TIBI: The PPV offering was added alongside subscription because of the demand for the latest content right after its cinematic release. Saudi Arabia is a very important market for us as there are no cinemas, with the exception of one IMAX theater in [the city of] Khobar that only shows documentaries. The PPV offering will in turn also help tackle the issues of piracy and illegal downloading in the region.

TV MEA: Are you looking at any other business models for icflix?

TIBI: We recently introduced the AVOD [advertising-based] business model, where we allow viewers to watch Hollywood documentaries, a select number of Bollywood titles and Arabic TV series for free.

TV MEA: Tell us about the kinds of content you’re licensing for your subscribers.

TIBI: We license movies, TV series, documentaries and kids’ programming across our offerings of Hollywood, Bollywood and Jazwood [content]. We have our own original productions from across the region, both North African and Middle Eastern. In addition, in our biggest announcement yet, 1001 Nights (Alf Leila wa Leila) will be released during Ramadan and will be shown exclusively on icflix with subtitles in English and French.

It will be the Game of Thrones of Arabic content—it is at that level of production. It is being shot in four countries, including Ireland, Greece and Egypt.

TV MEA: Tell us about your expansion into original content.

TIBI: icflix’s phenomenal success has given us bigger ambitions to create our own theatrical movies, four of which have been completed. HIV went online in October 2014 and was the first Arabic film to portray the story of the disease and its impact on the social settings of those infected. This was followed by the release of Al Makida in late December, a police thriller produced in Egypt by a

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team of fresh talent. Al Makida was shown across 200 cinemas in Egypt. Our commitment is 12 original productions in 2015. In addition, six productions are planned for Morocco with the Centre Cinématographique Marocain, the local cinematic institution. Our productions don’t go after famous actors. Every movie will have fresh faces and excellent acting. icflix runs a Jazwood academy in Cairo where we cast new talent in collaboration with local universities and acting institutions.

TV MEA: How do you see the OTT landscape developing in MENA over the next two years?

TIBI: The OTT landscape is growing. The number of connected devices such as tablets and smart-TV sets is fueling the demand for OTT because consumers love the convenience and accessibility of being able to watch what they want, when and where they want. With infrastructure improving and internet speeds picking up, people want high-quality video on any device and a seamless experience that carries across all their devices.

TV MEA: What are your overall goals for icflix in the next 12 to 18 months?

TIBI: The next 12 to 18 months will be big for us because we’re going to have many strategic partnerships, whether with telecom operators or content providers, or for our own original productions. It will also be an important year as internet speeds improve across MENA and more people become more aware of our service. We are also doing a lot of research to ensure that we can deliver 4K streaming at the lowest possible bandwidth without interrupting the quality. Providing a technical solution to deliver our content in the best quality, at the lowest bandwidth, in a way that is very usable and exciting for the customers, is our ever-present challenge.

icflix is making Hollywood, Bollywood and Arabic content available to subscribers across the MENA region on multiple screens.

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TRACE Sport Stars’ Top 10: African Rhythm Fans.

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SOUTH AFRICA

As new players enter the pay-TV business, Jay Stuart explores the fast-changing developments in the South African media market. fter a stumbling start, competition is picking up steam again in the pay-TV market in South Africa. New licenses have been awarded and there are important new twists in the efforts to challenge the dominant provider, MultiChoice, in the country’s most valuable television sector. Most significantly, Chinese investment has come into the market and now there’s real competition for sports programming, the most important pay-TV content.

Pay TV in South Africa actually outstrips TV advertising in revenue. The number of pay-TV homes is on track to grow by 7.3 percent annually from 2013 to 2018, according to PwC forecasts. That’s more than double the projected EMEA average of 3.2 percent over the same period. South Africa will add 2 million pay-TV households by the end of 2018 to reach 6.8 million homes—producing projected revenues of R20.1 billion ($1.73 billion). South African pay TV is dominated by satellite delivery.

The South African market’s growth is going to be a bit lopsided. Pay-TV revenues will actually grow slower than subscription numbers, at just 4 percent annually. This is because many of the homes being added will be coming in with lowcost packages. The defining element of South African competition in the sector is the pursuit of these new entry-level basic subs from the growing middle class. Indeed, average revenue per subscriber is actually projected to decline by 3 percent annually from 2014 to 2018 as MultiChoice introduces lower-cost options and upstarts focus on offering lower-price services. Average monthly spending on pay TV declined from R376 ($32) in 2009 to R297 ($25) in 2013.

OPENING THE GATES In April of last year, the Independent Communications Authority of South Africa granted five new conditional payTV licenses on top of the five pay-TV licenses issued in 2007. One of the original licenses went to MultiChoice, which was already in a virtual monopoly position. Of the other four, only one actually launched as a broadcaster, and

that one, On Digital Media (ODM), ran into trouble. ODM, the company behind TopTV, subsequently went into what’s called “business rescue” in South Africa, a sort of administration for companies in financial distress, before re-emerging with Chinese backing (more on this later).

NICHE APPEAL So the track record for new pay-TV competitors is not promising. Not all the newcomers are punching at the same weight, and some of them are targeting quite specific untapped niches. The new crop of five includes Close-T Broadcast Network, which aims to launch South Africa’s first gay-targeted channel, CloseTV, with a pay-per-view on-demand option.

Mindset Media plans to deliver educational TV channels to schools around the country; the business plan calls for provinces to pay subscription fees per school. Mobile TV plans to launch eight TV channels and four radio stations for mobile devices. Kagiso Media intends to start Kagiso TV with about 70 channels heavily focused on local content for a subscription fee of R240 ($21) per month. Siyaya TV, the highest profile newcomer, has already grabbed rights to the South African national soccer team to underpin its planned launch.

Bear in mind that these new pay-TV licensees might not be the most exciting challengers for MultiChoice.

“At this stage, the future of the pay-TV landscape is uncertain due to the delay in the DTT migration,” says Vicki Myburgh, the Entertainment & Media Industries leader for PwC South Africa. “When looking at the recent developments in the market and further announcements by the government, viable competition seems likely but will take some time to establish itself in the market—as was the case with MultiChoice when it started. New licensees will need to provide service offerings with good value offerings, including high-quality content at the right price, to entice viewers to shift from the current incumbents.”

MultiChoice is one of the world’s big pay-TV players, having passed 5 million subs in South Africa a year ago for its DStv service. Services range from premium packages fea-

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turing more than 130 channels, including 20-plus in HD, to the low-end EasyView packages with the subscriptions starting at only R29 ($2.50) per month. During the latest financial year, MultiChoice recorded a 15-percent increase in revenues to R27.5 billion ($2.37 billion), and operating profit advanced 11.3 percent to R7.8 billion ($671 million).

The new DStv Extra package and the lower-priced Compact and Access packages have been the strongest performers of late, according to MultiChoice Group CEO Imtiaz Patel. Aggressive investment in marketing, decoder subsidies and increased interest in local content are the key drivers of growth. DStv Extra was launched as an offering positioned between the Compact and Premium packages. In August 2014 MultiChoice made HD signals available to all its DStv customers, including the low-cost packages. Previously, only premium subscribers had HD access.

DEFENSIVE INNOVATION “MultiChoice is very much aware of the competition,” says Bakori Davis, the VP of commercial operations at A+E Networks UK, a joint venture of A+E Networks and Sky covering channel distribution in 90 countries, including South Africa.

“It’s launching HD and investing in technology and rethinking its programming. That doesn’t just mean adding programming. They are dropping things too and really rethinking what they’re offering in order to make the product better.”

How can you attack a competitor as dominant as MultiChoice with any chance of success?

“From below,” Davis says. “MultiChoice is essentially a premium, high-end pay-TV service along the lines of European providers such as Sky or CANAL+. The growing middle class has opened up the potential of a different market segment. Think of basic cable with a bottom tier that is very basic; television that introduces a difference between free to air and pay. That is the entry point they’re shooting for.

They are looking to pick up the lower end of the market with a moderately priced offer.

“This competition actually has relatively small impact on MultiChoice,” continues Davis. “The challengers are not taking on MultiChoice head-on, but there are a lot of exclusivity issues to deal with.”

e.tv, home to the entertainment series Scandal!, is eyeing opportunities in DTT.

BREWING COMPETITION From A+E Networks, MultiChoice has HISTORY, CI and Lifetime. These are exclusive, but new arrivals could open up possibilities for the group’s other channels. “Competition is always a very healthy and welcome thing,” Davis says. “We’ve been through this dance before with TopTV [now StarSat], but they still look like the most serious competitor for MultiChoice now that there is Chinese backing from StarTimes.”

A few years ago, MultiChoice preempted the launch of TopTV by introducing its Compact package aimed at the middle market.

“The middle market is a very different animal from the top end,” says Ian Woodrow, head of content at StarSat. “The big business difference is that churn is so much higher.

Top-end subs tend to stay put. The middle-tier subs jump in and out. We have battled churn.”

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ODM went into business rescue in October 2012. Pay TV is notorious for gobbling cash. A burgeoning pay-TV business consumes cash for the first two or three years. The shareholders probably didn’t realize that. “They thought it was a license to print money,” says an insider close to the situation. In October 2012 those shareholders decided they were not prepared to fund it any longer.

A search for new investors began. There were a couple of interested parties, including East African group Wananchi.

Then along came China’s StarTimes Media Group. The group runs DTT businesses across Sub-Saharan Africa, with a satellite footprint across the region and operations in 12 countries, mainly through joint ventures with governments.

Deals are pending in several more markets.

South Africa is one market where StarTimes does not have a DTT license, and in troubled TopTV it saw the opportunity to pursue a DTT-style strategy by other means. Trying to head off the new challenge, MultiChoice put in a blocking bid to no avail. The Chinese entered South Africa and TopTV was rebranded as StarSat in November 2013. A new set-top box has since been introduced offering HD capability.

ODM still exists as the company that manages the content and broadcasting, while StarTimes runs all the backoffice functions such as subscriber management. The reason for the continued division is to circumvent South African regulations on foreign ownership limiting any foreign company to 20 percent of a broadcaster.

GAME FACE There is a good argument to be made that MultiChoice’s SuperSport has been the most dominant sports provider to date in any national market. Over the years, MultiChoice has held the rights to just about every attractive sports property, including all the premium soccer from Europe, led by the English Premier League and the UEFA Champions League, while sharing the FIFA World Cup and Olympic Games coverage with public broadcaster SABC. MultiChoice even launched a 24-hour channel in 2014 exclusively to cover the murder trial of South African athlete Oscar Pistorius. It quickly became the fourth most popular pay-TV channel in the country with up to 191,000 viewers a day.

Now cracks have appeared in MultiChoice’s sports monopoly. StarTimes has already launched its first sports channel, strangely called StarTimes Sports 2 (1 is coming). StarTimes Sports 2 already has French Ligue 1 soccer, and starting this summer it will have Germany’s Bundesliga. It also added exclusive rights to the World Rally Championship.

Before long, the intention is to have five different sports channels: one aimed at the lower tier, one aimed at the middle and three for the top tier. “This is a big move,” StarSat’s Woodrow says. Gary Rathbone, formerly of MultiChoice’s SuperSport, has been hired to steer the ambitious new sports approach.

“We’re not out of the woods yet because we’re not marketing,” Woodrow says. “Pay TV is like selling Coca-Cola. You have to advertise and if you don’t, you lose sales. ODM remains in business rescue for the time being, and coming out of business rescue is a bureaucratic process and it’s not very efficient. We are still waiting for a transfer of the broadcasting license.”

A few channels have been lost in the transition from TopTV to StarSat. The key loss was TLC, which was a very well received lifestyle channel. StarTimes actually has the channel outside of South Africa.

ODM has a half-dozen FOX International Channels assets, including FOX Crime, FX, BabyTV and two FOX Sports channels. “We have also added FOX Movies and QYOU, which is sort of a cross between YouTube and MTV, and we have this exclusively for the whole of Africa,” Woodrow says. “Some other channel providers think we have a special relationship with FOX and ask, Are you joined at the hip? I tell them, We can be joined at the hip with you too, if you give us your channels.”

ETHNIC SEGMENTATION “The South African market remains quite segmented along ethnic lines and that is a key to understanding pay-TV strategy,” Woodrow continues. StarSat offers 17 Chinese channels to cater to South Africa’s big and growing Chinese population, officially estimated at 500,000 and unofficially at more like 1 million. It has also increased the size of its Indian package to nine channels. South Africa has about a million people of Indian origin.

Sports preferences very much follow ethnic lines, and the black audience, and its rising middle class targeted by ODM and Compact, focuses on football. White subs want rugby, cricket and foreign soccer (especially the English Premier League). Indian viewers want cricket.

Compact’s soccer-based channels appear to be a loss leader aimed at enlisting black subs. It’s therefore hard to see how the cost of the rights can be recouped. But since MultiChoice’s premium sports channel has rights to everything else, there is no cannibalization.

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Pay-TV channel M-Net invests heavily in local content, with a lineup that includes the format-based Celebrity MasterChef South Africa.

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A+E Networks localized its hit Pawn Stars franchise for the South African feed of HISTORY, which is carried on DStv.

Soccer is also the key to the approach of Siyaya TV, probably the most interesting of the new licensees. Siyaya TV has a R1 billion ($86 million) six-year deal to show matches with Bafana Bafana, the South African national soccer team, starting this May. There is speculation that, rather than investing in digital satellite infrastructure, Siyaya TV might be waiting for DTT to arrive. DTT is the elephant that has not yet entered the room.

It’s on everybody’s mind because it supports low-cost or nocost options in a market where potential customers are very price-conscious.

DTT is scheduled for launch in June of this year with the switch-off of analogue services. The launch has been delayed several times after its initial soft launch in October 2012. An unexpected new development came up just recently that could mean more delays: DTT might be opened up to pay-TV options.

Originally the authorities said that the new platform would be unencrypted, with all channels freely available. In February of this year the government backtracked and said it would allow an encrypted pay-TV offer. MultiChoice is very unhappy about the new policy. ODM is a bit less so, taking the view that it will mean still more delays, giving more time to establish StarSat. Even if DTT channels are free to air when they arrive, they will have to compete. “Viewers of both free to air and pay TV will have more choice in terms of channels and programs, and that will result in advertisers having to carefully allocate their spend between channels depending on viewership and target market,” says PwC’s Myburgh. “Free-to-air programming will have to be of superior quality in order to re-route subscribers away from pay television.”

FREE FOR ALL The Sabido group, which owns terrestrial broadcaster e.tv, has moved preemptively in the low-cost space, anticipating the launch of DTT with a free satellite platform, Platco Digital, carrying a free-to-air satellite TV service called OpenView HD that began in October 2013. The OpenView HD service is free, but requires a satellite dish and decoder, with costs ranging from R849 ($73) for a decoder to R1,599 ($138) for a full dish and decoder installation. The service currently carries more than 18

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channels, including four in HD. Content includes four religious channels, SABC1, 2 and 3, as well as eMovies+ and eAfrica+.

“The majority of South African TV owners do not have access to a multichannel viewing experience,” says Shalamar Zandamela, Platco Digital’s marketing manager. “OpenView HD is aimed at these people who don’t want to have to pay a monthly subscription for more channels and crystal-clear quality. There is a one-off payment for the decoder and a dish if required, and then they have access to multichannel satellite TV on two satellites. We are targeting not only first-time satellite TV buyers but also lapsed satellite TV owners that no longer wish to continue with subscription-based TV.” Asked if the business might change with Platco adding a pay tier later, she says, “We definitely want to reassure people that our platform is free-to-view and reinforce our value proposition of ‘no monthly fees’ in the market.”

OpenView HD’s programming caters to the diverse South African viewership with a balance of local and international content. “The platform offers content producers a wide range of opportunities within the channels to showcase their work,” she says. “The programming is determined by the channels to a large extent and mirrors the richness of the South African landscape and viewers. We have an average of 40 percent local content across eKasi+, eAfrica+, Mindset and e.tv in HD. We also carry well-known imported programming.”

The other new technology coming into South Africa is the arrival of OTT. MultiChoice has made BoxOffice, its movierenting service, available to any home with broadband and boosted its VOD content. Netflix recently confirmed that South Africa is in its sights for expansion.

Will OTT competition impact MultiChoice? “Broadband is still expensive and many still don’t have access,” says PwC’s Myburgh. “Secondly, it depends on what pricing structure and programming will be available on OTT providers.”

Is the heating up of competition in South Africa likely to generate much price escalation for international programming? “For the short term the answer is probably no,” Myburgh says. “And when viewers are able to get quality free-to-air content on new DTT channels, pricing could be under pressure even further.”

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