Tuesday, May 29, 2018

Cell C's black: MultiChoice's threat of Netflix taking over is exaggerated.

Cell C's subscription video-on-demand (SVOD) service, black, says MultiChoice's hype that Netflix is going to take over, is exaggerated.

MultiChoice, Africa's largest pay-TV operator, told South Africa's broadcasting regulator earlier this month that Netflix is a threat and caused the loss of over 100 000 DStv Premium subscribers during the last financial year. Yet MultiChoice isn't reaching out to Netflix for a possible partnership in the way that America and Britain's biggest pay-TV operators have been doing.

The Independent Communications Authority of South Africa (Icasa) is once again conducting an inquiry into South Africa's pay-TV sector and is looking at, and will consider, how to possibly amend regulations.

MultiChoice is arguing for South Africa's broadcasting regulator to urgently implement regulations on global streaming services like Netflix and Amazon Prime Video operating in South Africa, instead of imposing even more onerous regulations on video entertainment businesses like MultiChoice.

The global over-the-top (OTT) streamers for instance don't pay local taxes and are not encumbered by things like local content quotas and other regulatory restrictions.

MultiChoice wants Amazon Prime Video and Netflix South Africa to be regulated - similar to what the European Union (EU) is currently implementing in terms of 30% local content quotas and tax requirements.

Cell C black says that while Netflix is a competitor, black doesn't see Netflix preventing media companies from thriving locally. Cell C black says the service is experiencing good growth despite the presence of competitors like Netflix, Naspers' Showmax run by MultiChoice and MultiChoice's satellite pay-TV service, DStv.

"Netflix has built up a global brand bby offering customers movies that are no longer in the rental pay-window. This means content on our platform will actually have movies before they are on Netflix," says Surie Ramasary, Cell C black chief executive.

"They do not offer local content in every market, including South Africa. This is where we will have a competitive edge. In addition we will also start to build a library of our own originals overtime."

She says this could actually lead to job creation and not losses. "black believes as more content players enter the market customers will have increasing choice and will subscribe to more than one service."

"Much will depend on how well you treat your customer and look after their needs. Customer service will be a key differentiator as well. Media companies who are poor at this will see a decline in their subscribers."