Business and Technology

This is why South Africans are dumping DStv Premium

MultiChoice has published its interim financial results for the period ended 30 September 2020, showing a steep decline in DStv Premium subscribers.

The group added 2.1 million 90-day active subscribers across all regions compared to the same period last year, reaching 8.7 million households in South Africa.

This subscriber growth was attributed to the adoption of its cheaper DStv packages, however, as the company lost a significant number of DStv Premium subscribers.

“The impact of COVID-19 and the associated lockdown saw consumers prioritise video services, but a lack of live sport and the inability of commercial subscribers to trade negatively impacted revenue generation,” MultiChoice said.

DStv customers

The Premium subscriber base in South Africa declined significantly over the past six months, negating gains in mass-market subscriber growth.

“Revenue declined 3% to R16.5 billion due to lower advertising (R0.6 billion) and commercial subscriber revenues (R0.3 billion),” MultiChoice said.

“Excluding the YoY movements on the above revenue categories which were impacted by COVID-19, revenue growth would have been positive as healthy subscriber growth in the mass market and the annual price increases were negated by a lower average Premium subscriber base in the absence of live sport.”

The company also save a significant drop in average revenue per user (ARPU) due to its decline in DStv Premium subscribers.

“The ongoing shift in subscriber mix towards the mass market, combined with the impact on Premium and commercial subscribers as mentioned, resulted in the monthly average revenue per user (ARPU) declining 5% from R292 to R278,” MultiChoice said.

DStv Premium continues to plummet
One of the biggest drivers of DStv’s Premium subscriber decline was the lack of live sport due to the COVID-19 pandemic.

“SuperSport had to contend with no live sport for most of 1H FY21 and nimbly adapted by changing channel line-ups, broadcasting top-quality documentaries and showcasing blockbuster sporting movies to keep subscribers entertained,” MultiChoice said.

The company’s Connect Video division continues to grow, however, with more users signing up to DStv Now and Showmax as online consumption increases.

MultiChoice has also partnered with Netflix to make DStv available on its latest Explora Ultra decoder, which it said will allow subscribers to seamlessly shift between satellite and online platforms, with all content aggregation occurring centrally via one billing platform.

The company has also recently launched a selection of new offerings, such as Showmax Pro, Add Movies, and the overhauled DStv app, and it has renewed a number of important sports broadcasting rights.

MultiChoice classifies its subscribers into three market segments for reporting purposes: Premium, Mid-market, and Mass-market.

These reflect the following subscribers:

Premium – DStv Premium and Compact Plus
Mid-market – DStv Compact and Commercial
Mass-market – DStv Family, Access, and EasyView
“Premium” subscribers declined by 9% to 1.4 million, “mid-market” grew by 2% to 2.9 million, and “mass-market” grew by 17% to 4.4 million.

The image below details the decline in DStv Premium subscribers in South Africa.

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Source: mybroadband