MultiChoice warns shareholders of tougher times ahead as customers drop from 23 million to 19 million in two years
MultiChoice, Africa’s leading entertainment platform and parent company of DStv, has warned its shareholders to brace for more difficult times ahead as it continues to struggle with a challenging business environment across its key markets.
The company, which has long dominated Africa’s pay-TV industry, has suffered a sharp decline in its subscriber base, dropping from over 23 million to 19.3 million in less than two years.
The loss has been most pronounced outside its home market of South Africa, with Nigeria emerging as a major pressure point. The country, which once served as one of MultiChoice’s biggest revenue sources, has seen a steep decline in subscribers.
In a statement detailing the challenges it faces, MultiChoice highlighted Nigeria’s economic turmoil as a key factor behind its struggles.
“The loss in the rest of Africa has been primarily due to the significant consumer pressure in Nigeria, where inflation has remained above 30% for the majority of the last 12 months and, more recently, due to extreme power disruptions in Zambia,” the company stated.
MultiChoice is currently preparing to release its financial results for the fiscal year ending March 31, 2025, and has already warned that the tough consumer environment has not only driven away subscribers but has also stifled revenue growth.
MultiChoice’s decision to repeatedly increase its subscription prices has fueled tensions with Nigerian consumers and regulators. Over the past two years, the company has implemented several tariff hikes, citing the rising costs of operations, currency devaluation, and increasing business expenses in Nigeria’s tough economic climate.
In April 2023, MultiChoice raised its DStv and GOtv subscription rates by an average of 17%, blaming inflation and foreign exchange volatility. Just a year later, in April 2024, the company announced another price hike of up to 20%, sparking outrage among subscribers.
The price hikes have led to mounting consumer backlash, with many Nigerians accusing the company of exploiting the country’s economic crisis for profit. Consumer rights groups and regulatory bodies, including the Federal Competition and Consumer Protection Commission (FCCPC), have also waded into the dispute, demanding that MultiChoice justify its continuous increases in subscription rates.
At various times, the Nigerian National Assembly had intervened, attempting to compel MultiChoice to adopt a pay-as-you-watch model, a demand that has long been echoed by Nigerian subscribers. However, MultiChoice has resisted, arguing that such a model is not feasible for its business operations.
Despite the public outcry, the company has defended its price adjustments, pointing to soaring operational costs, including the expense of acquiring foreign content, maintaining satellite infrastructure, and sustaining local productions.
Subscribers Decline More About Economic Hardship Than Tariff Protest
Although MultiChoice’s tariff hikes have undoubtedly fueled dissatisfaction among Nigerian consumers, industry analysts believe the sharp decline in subscribers has more to do with economic hardship than a protest against price increases.
Nigeria’s inflation has been at record highs, remaining above 30% for much of the past year. Food prices, rent, and transportation costs have skyrocketed, significantly reducing disposable income for millions of Nigerians. Faced with rising living costs, many households have been forced to cut back on non-essential expenses, including pay-TV subscriptions.
Industry experts note that Nigerians are not necessarily boycotting MultiChoice over its price hikes but are simply unable to afford the service anymore. Even consumers who previously subscribed to premium packages have been downgrading to lower-tier plans or abandoning their subscriptions altogether.
A Tough Road Ahead for MultiChoice
MultiChoice’s latest operational update paints a grim picture of the challenges facing the pay-TV industry across Africa. The combination of economic hardship, consumer resistance to price hikes, and increased competition from streaming services like Netflix and Amazon Prime has put the company in a precarious position.
The company is now at a crossroads, as it must find ways to retain subscribers while managing its rising costs. While it has been investing in local content and digital offerings to attract viewers, the decline in subscribers in Nigeria suggests that recovery may be slow.
