DSTV has held uncontested monopoly over South Africa’s paid TV market for many years. Alternative services have materialised in recent years, but none with the features to rival DSTV.
Enter, Netflix, an online streaming service that has been tipped to finally give DSTV some much-needed competition.
Many believe that DSTV’s revenue will suffer following the introduction of Netflix in South Africa in 2016, and it’s easy to see why.
A lack of competition has allowed the broadcast service to retain high prices for their TV packages over the years. To gain access to all the channels and services DSTV has to offer, one must be subscribed to their Premium package, which goes for R799 a month.
Only the higher value packages allow subscribers access to MultiChoice’s BoxOffice service, which offers the ability to rent movies online movies online for 48 hours, through the decoder.
Altech’s NODE was set up with the same with a similar concept to the BoxOffice service. The service offers its own decoder, and a custom designed remote, allowing subscribers to switch effortlessly between regular television and online content.
While a subscription to NODE is only a R299 setback, the R3499 once-off charge for the decoder takes some convincing and serves as a reason why it never matched the success of DSTV.
This may change, however, in light of its latest Triple Play package, which offers TV, phone, and internet with MTN, plus the decoder fee, all rolled into a monthly R799.
VIDI is the newest TV-on-demand service in South Africa, and the most similar to Netflix’s service. The streaming service is South African orientated and allows users to have instant access to online film and television content.
A subscription costs R149 a month, with the option to rent newer movies or programs. It’s available on most computers and handsets with an internet connection, though hooking them up to your TV can be a hassle.
Also, in comparison to Netflix, VIDI has access to significantly less content. As a relatively unknown service, it is doubtful that it will be able to compete with Netflix. This is especially true as it currently remains overshadowed by DSTV, though arguably due to the infrastructure available to South African users.
For a long time, the internet had limited availability in South Africa, making it easy for DSTV to monopolise the market as the best-paid TV service.
In recent years, however, internet penetration has increased dramatically throughout the country, spurning the creation of the newer services, VIDI and NODE. With the current Fibre-to-the-Home campaign well underway, South Africa is well on its own way to becoming the ideal market for Netflix, which is most effective through a fast internet connection.
In light of the perks that come with Netflix, DSTV will struggle in the age of the internet to remain relevant and competitive, despite its big trump card: the sports channels.
DSTV’s biggest draw will undeniably be its multiple sports channels, which broadcast live sports matches to its many subscribers. Additionally, DSTV owns full rights to the popular SuperSport channels, and its content cannot be broadcast elsewhere.
Sports are a huge incentive to remain a DSTV subscriber despite better online streaming options. DSTV subscriptions are easily down-gradable, however, and it will be interesting to see if consumers remain loyal to the broadcast company, or downgrade to the lowest package for sport channels before taking out a Netflix subscription.
At R88 ($8 in America) a month with no additional fees, Netflix plans to remove its geo-blocking system, allowing all its operating countries access to the same content. With no schedule or ad breaks, Netflix gives subscribers access to thousands of hours with of content.
DSTV may have a sports option, but Netflix is set to pull popular series off DSTV. Successful series, such as Orange is the New Black and House of Cards, have signed off their rights to Netflix, and they will be removed from the DSTV broadcast once Netflix enters the South African market. This will be a huge blow to DSTV.
Regardless of its hold on the sport market, DSTV will have to consider dropping monthly rates and restructuring its broadcast content in order to remain a major paid TV player in South Africa.