Multichoice’s latest financial statements (for the year ended 31 March 2018) showed a marginal decline of its high-end customers (those who subscribe to its premium bouquet). DStv provides multiple channels to its almost 13 million subscribers in various countries in the continent. As the leading Pay-TV in Africa, DStv also has its live online streaming service, DStv Now, which offers entertainment, sports, news, and children’s channels on its lineup.
According to Naspers (Multichoice’s parent company) financial statements Multichoice lost at least 41000 high-end subscribers. This marked a decline from 1.962 million to 1.921 million over the last year. Consequently, I think this decline may have contributed to the reduction of Multichoice’s Average Revenue Per User from R353 to R344 year on year.
With the emergence of more players in the African Pay-TV market such as Kwese and StarTimes, Multichoice customers seem to be defecting to these as they are offering lower prices ( Penetration pricing) whilst still providing quality programmes.
Despite the decrease of its premium customers, Multichoice registered an increase in its overall customers base. Over the last year, MultiChoice’s DStv subscribers grew from 11.942 million to 13.476 million, representing an increase of 13%.
The increase was driven by both compact and other lower end bouquet customers (family and lite). Compact customers grew from 3 181 to 3 520 and lower end customers increased from 6 799 to 8 035 over the year. The lower end still is the most important cohort of Multichoice’s customer base which now accounts for 60% of its total subscribers.