Tuesday, June 25, 2013

BREAKING. MultiChoice focusing strongly on penetrating and growing lower subscriber base with cheaper bouquets; want to expand online.

The South African pay-TV platform running the DStv direct-to-home (DTH) satellite service in South Africa and across the African continent is strongly focusing - and will continue to do so - on penetrating and growing its lower subscriber base of viewers by enticing them to sign up to cheaper DStv bouquets; MultiChoice is also strongly focused on the growing expansion and delivery of content online.

Eben Greyling, the CEO of pay-TV platforms at Naspers said in Naspers' investors' press conference during the presentation of Naspers' financial year report for the period ending 31 March 2013 which took place late this afternoon, that the average revenue per DStv subscriber is expected to decline in the future.

ALSO READ: MultiChoice grows revenue by 20% to R30,3 billion for the year ending 31 March 2013; tops 6,7 million subscribers across Africa.

Although MultiChoice's overall revenue is up, and although the average revenue per subscriber increased marginally for the year until the end of 31 March 2013, the average revenue per DStv subscriber will likely decrease in the future because the number of DStv subscribers who are part of lower-tiered DStv bouquets will grow.

What it means is that MultiChoice will  have more subscribers - and in fact wants more of these subscribers  (since it enlarges the customer base) - on cheaper bouquets below the most expensive DStv Premium bouquet.

While DStv Premium subscribers bring in the most revenue per subscriber as the most expensive bouquet, more subscribers on lower-tiered bouquets such as DStv Compact - who are more in number than DStv Premium subscribers - bring in lower average subscriber revenue but overall more money because there's much more of them.

ALSO READ: MultiChoice starts a new bouquet, DStv Extra, at R380 per month as a new mid-tiered channel package.

"Average revenue per subscriber increased marginally but we expect it to decline as we change the mix in our subscriber base because of our focus to penetrate the lower subscriber base," said Eben Greyling during Naspers' financial report press conference.

"Growth in the lower priced DStv Compact bouquet remains strong," said Eben Greyling. DStv PVR households also "recorded good growth" and this MultiChoice decoder is now in just under a million TV homes."

Naspers achieved an annual growth rate in its pay-TV business of 21% for the last five years and "the business continues to show good growth," said Eben Greyling.

He also said that Naspers' pay-TV business division is strongly focused on increasing the online delivery of content as broadband internet penetration in South Africa and across Africa grows.

"Regarding competition we continue to see an increase in competition across the continent from both traditional players as well as online players," said Eben Greyling. "Existing players in the broadcasting space are aggressively growing their business and we're also seeing new players. Regarding the online delivery of content there's also video-on-demand (VOD) services and international players such as Apple expanding their online business here."

"We're sure that this trend will definitely increase in the future and our own online developments will continue in future to help face this onslaught," he said.

Eben Greyling said the popular DStv BoxOffice service on PVR's was recently made available online. The DStv Catch-Up service was also recently expanded to more devices like the iPad and that MultiChoice will later this year expand it to Android tablets and other devices.