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ShowMax vs Netflix is a battle David will lose to Goliath

ShowMax vs Netflix is a battle David will lose to Goliath

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ShowMax vs Netflix battle is one where David will lose to Goliath

Video on-Demand (VoD) platforms have been having a field day in the media circle in recent years, changing the way content consumers watch their favourite shows. However, leading the streaming wave and disrupting consumers’ behavioural pattern is Netflix, a company that was once put up for sale. 

Netflix as the Goliath  

Netflix started out as a DVD rental company in 1997. However, since it began streaming in 2010, it has caused a major disruption in the media business, forcing its Pay-TV rivals to restrategise, as its onslaught encouraged a cord-cutting campaign among TV viewers in Western countries. 

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The growth of Netflix, aided by its romance with content creators, forced cable companies to put aside their rivalry and engage in boardroom meetings that eventually led to mergers and acquisitions. Notable consolidations include Comcast’s $40 billion takeover of Sky Media and AT&T’s $85 billion takeover deal for Time Warner. 

The shock wave that hit the media space in Europe and the United States is currently spreading through Africa, Nigeria specifically, causing the likes of DSTV to have cold feet concerning the future of Pay-TV in Africa. While MultiChoice, the parent company of DSTV, currently dominates the media business in Africa, the penetration rate of Netflix signals the end of Pay-TV. 

To secure its position in the media business, MultiChoice has been trying to rejuvenate Showmax, its online subscription Videoon-demand service that was established in 2015, repositioning Showmax to compete against Netflix. The Pay-TV, however, seems to be fighting a lost battle. 

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[READ MORE: Kwese TV finally shuts down]

 

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The war of subscription plans 

Both Netflix and Showmax run an online subscription payment model, though with differences 

Netflix offers subscribers three different payment plans: Basic, Standard, and Premium, which cost N2,888, N3,610.99 and N4,333.91 respectively; each offering perks according to the payment plans.  Showmax provides only one subscription plan at N2,900.  

To lure subscribers, both companies offer free trials for particular durations, which give prospective subscribers insights to the catalogues of entertainment content available on both VoD platforms and help them in making their subscription decisions. 

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But while Netflix offers a free trial period of 30 days, Showmax has a 14-day free trial period before charges begin for subscribers. However, they both offer options to opt-out, with no commitments or tie-down contracts to force subscription on subscribers. 

 

Why MultiChoice is losing subscribers and content to Netflix 

Battle for content: The number of catalogues, the quality of series and movie shows depend on the spending capacities of streaming platforms. For Netflix, getting the best content and production is a walk in the park because of its financial firepower. 

The streamer was estimated to have spent about $12 to $13 billion on content in 2018 for about 82 new feature films. 85% of the 2018 spending was earmarked for original series and movies (Netflix Originals). Also, according to Goldman Sachs’ projection, Netflix is expected to spend $22 billion by 2022.  

The company signed contracts with Barack and Michelle Obama, comedian Kelvin Hart, Singer Taylor Swift, among many other celebrities, and top Hollywood production outfits like Warner Bros, Universal Pictures, and Sony Pictures Entertainment to provide content for its library. Netflix offers more than 140 million hours of TV shows and movies per day. 

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For ShowMax, the amount spent, and the number of films produced are not known. MultiChoice (where  ShowMax gets its content) is planning to produce 29 local dramas and 52 local movies by 2020 through its Africa Magic subsidiary. The company depends on foreign cable TV companies for western movies that have passed their peak periods. 

[READ ALSO: How Cable TV could die in Nigeria]

 

Will DSTV’s legacy hurt ShowMax?  

Nigerians now prefer up-to-date cinema-standard content but ShowMax isn’t really offering subscribers anything new apart from recycling entertainment shows from DSTV. Netflix has liaised with non-sport content creators for consumer-driven shows, leaving MultiChoice with low budget Africa Magic movies. Even cinema houses are struggling to premiere movies as the US streamer continues to acquire exclusive rights to new movies. 

While there is no Netflix record for the Nigerian market, the impact of its content reflects in South Africa, where about 300,000 to 400,000 subscribers are attributed to Netflix, with DSTV claiming to have lost more than 140,000 TV subscribers between 2017 and July 2018 to the company. So, despite ShowMax priding itself as the streamer with the largest movie collection in Africa with 25,000 programmes, Netflix’s updated catalogue of exclusive TV shows to movies, music concerts, docuseries and comedy specials are most preferred. 

However, DSTV’s legacy could also be ShowMax’s key driver in the streaming market in Nigeria because DSTV’s dominance of over 15 years has remained solid. The addition of consumer-driven content such as live sports events, reality shows like Big Brother Naija and its household drama, ZeeWorld, onto its catalogue could be a game-changer for ShowMax. This will later position the streamer as a total package compared to Netflix but when this will happen remains unknown. 

We are uniquely positioned to deliver a quality video-on-demand service to customers, due to our access to a broad range of content (original local content, live sport and the best international content); strong partnerships (telcos, distributors); well-developed payment solutions; competitive pricing, and comprehensive coverage of connected consumer devices, MultiChoice told Nairametrics. 

[READ FURTHER: Why MultiChoice is suspending plan to sack 2000 employees, for now]

 

Netflix is a profitable alternative 

The romance between African filmmakers and MultiChoice’s Africa Magic is under intense pressure from Netflix’s tech money because a part of Netflix’s billion-dollar content spend includes Nollywood and African entertainment industries. 

In addition, movies and TV series on Netflix get nominated for award considerations, with over 120 international nominations since they began streaming. This is because Netflix introduces movies to over 190 markets (countries) regardless of their origins. This audience strength, award consideration and sizeable funding opportunities are what make Netflix a destination of choice for film producers and content creators.  

Speaking to Nairametrics on the value of Netflix, Nollywood actor, Greg Ojefua said, “Many producers out there are setting out to do a movie for Netflix because it is more profitable than many of the available outlets now. For the cinema, to do proper promotion and marketing for the movie will take a lot and there’s no guaranty that the producers will make their money back… Netflix just wants a great story, you to meet up with their technical specifications; have solid content.”  

Initially, Netflix only acquired movies after their cinema debuts but now, the company has begun to acquire the sole rights to movies right from the production stage. In Nollywood, it started with Genevieve Nnaji’s Lion Heart, and Netflix further acquired exclusive rights to Kunle Afolayan’s Mokalik. 

Netflix has a loophole that favours ShowMax 

It might be too early to rule Showmax out, considering the penetration rate and the positioning of   MultiChoice and Africa Magic in Nollywood. The standard of Netflix makes it difficult for many of Nollywood content to be eligible for viewing on its platform, and this limits the number of local content in its library.  

So, MultiChoice’s ShowMax is a lifeline for low budget movies, which the South African streamer has been catering to with Africa Magic. Ojefua also attested to this, stating that every market has its audience. 

“The truth is, like I will always say, there’s a fan for every song, So I don’t see much changes in that line. Netflix has always existed. Iroko, Ibaka, all the other Pay-TV have always been there. All I see happening is that, Yes, Netflix will attract more African or Nigerian contents, but I don’t necessarily see it affecting the business of the others,Ojefua said, as he believes that Netflix can’t solely satisfy the need of all Nigerians. 

Also speaking on competitors impact, MultiChoice said, We believe that competition is good as it offers consumers more choice and the ability to pick and choose services which suit their viewing needs.” However, the increase in competition splits content concentration more, increasing consumers spending, as they will have to subscribe to numerous services. 

But with MultiChoice struggling to keep its subscribers in Nigeria, and South Africans engaging in cord-cutting, as well as prominent filmmakers favouring Netflix for distribution of their contents, MultiChoice’s Chief Executive Officer, Calvo Mawela has called on regulators to regulate the streaming market as the company seems unlikely to survive Netflix’s onslaught – but the promise of a total package service might be its VOD’s lifeline. 

[READ MORE: MultiChoice is blaming customers for its plans to lay off 2000 workers]

 

Patricia

Olalekan is a certified media practitioner from the Nigerian Institute of Journalism (NIJ). In the era of media convergence, Olalekan is a valuable asset, with ability to curate and broadcast news. His zeal to write was developed out of passion to shape people’s thought and opinion; serving as a guideline for their daily lives. Contact for tips: [email protected]

1 Comment

1 Comment

  1. Bimz

    November 27, 2019 at 6:55 am

    Multichoice is feeling the same WRATH they made their competitions go through in recent past!

    Now, their coo is asking for regulation in the sector, is that not funny!.. it is good they now have a richer competitor if not, a equal one.

    The battle will be a customer delight.

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Coronavirus

Just in: Lagos to reopen schools on August 3

The governor said that the resumption is only for pupils and students in graduating classes.

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Sanwo-Olu, COVID-19: Lagos ramps up measure to smash disease as it begins fumigation, Covid-19: Total lockdowm imminent as Lagos fears confirmed cases could hit 39,000, Hotels to remain shut in Lagos, as manufacturing and construction companies get conditional waivers, COVID-19 palliative: Sanwo-Olu concludes Homegrown School Feeding Programme

The Lagos State Governor, Babajide Sanwo-Olu has announced that both public and private schools will resume on August 3, 2020, after over 3 months of being shut down due to the coronavirus pandemic.

This is in line with the recent pronouncement by the Federal Government,

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This was disclosed by the Governor while giving a situation report on COVID-19 at Lagos House Marina on July 3, 2020.

The governor said that the resumption is only for pupils and students in graduating classes, that is Primary 6, JSS 3, and SSS 3 who are preparing for exams.

He said other schools will remain closed and should continue with the online studies.

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Details later…

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Hospitality & Travel

FAAN releases new guidelines for post COVID-19 flight operations

The new set of procedural guidelines for air travelers and other airport users is aimed at protecting all.

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FAAN reacts to release of guideline for resumption of flight operations post covid-19, FAAN releases new guidelines for post covid-19 flight operations

The Federal Airports Authority of Nigerian (FAAN), has released a new set of procedural guidelines for air travelers and other airport users. This follows the announcement of the Federal Government, the gradual commencement of domestic flight operations at the nation’s airports with effect from July 8, 2020.

This new Standard Operating Procedure (SOP) is aimed at protecting all stakeholders and preventing further spread of the coronavirus disease, especially through our airports.

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This was disclosed in a press statement by FAAN on Friday, July 3, 2020, and signed by the agency’s General Manager Corporate Affairs, Henrietta Yakubu.

According to the procedures that have been outlined by FAAN in the “New Normal”, departing passengers must comply with the following guidelines;

  • All passengers must arrive at the airport properly kitted with their face masks on.
  • They must also ensure a minimum of one point five meters (1.5m) physical distancing, Aviation Medical/Port Health personnel would screen each passenger and ensure the use of face masks, those traveling with pets must get necessary clearance from Nigerian Agricultural Quarantine Services.
  • All passengers’ luggage would be disinfected before entry into the departure halls.
  • Passengers are required to wash their hands as often as possible, hand sanitizer would be provided for passengers before entrance, at the waiting halls/lounges and pre-boarding gates.
  • All footwear would be disinfected/sanitized by foot mats placed at all entrances to the terminal building, amongst others.

(READ MORE: FG acquires profiling robots for airport)

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For arriving passengers, the following guidelines must be adhered to;

  • On disembarking from the aircraft, passengers would observe physical distancing as they board the Co-Buses (Hand Sanitizer would be provided in the buses).
  • Physical distancing protocols must be observed at the baggage claim area, where hand sanitizer is also provided, disinfected trolleys would be made available for passengers.
  • All Covid-19 protocols must be observed while undergoing customs check, Passengers would exit the halls and head straight to the car park for pick up.
  • If you must speak to anyone around, please speak to a properly tagged Aviation Security (AVSEC) officer, physical distancing would be maintained while waiting to be screened by personnel of port health services, amongst others.
  • In addition to the above guidelines, passengers are required to observe social distancing and make use of the floor markings at the security screening area. They must also comply with all other security guidelines as laid down by officials of the Aviation Security (AVSEC) department.

FAAN asked all passengers and stakeholders to observe these new protocols that have been put in place for their protection.

 

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Corporate Press Releases

First Bank’s FMAP graduates inuagural set of management associates

FMAP is a comprehensive developmental programme targeted at young, dynamic, highly driven individuals.

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First Bank of Nigeria Limited, Nigeria’s leading financial inclusion services provider,  has graduated 28 successful candidates in its inaugural FirstBank Management Associates Programme (FMAP), virtually held on Tuesday, 30 June 2020 via the Zoom video-conferencing application. The programme which commenced in 2018 had a total of 48 candidates selected from thousands of entries and applications received nationwide.

FMAP is a 24-month fast-track comprehensive developmental programme targeted at young, dynamic, self-motivated and highly driven individuals that possess the right skill set and excellent leadership potential among Junior and entry-level cadre staff. Entries and applications for the programme enrolment was also extended to the public

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Speaking about the programme, Dr. Adesola Adeduntan, CEO, FirstBank said “It is an intensive skill development programme structured to enhance acute thinking, financial, methodical skills of staff. The bank would continue to reinvest in its human capital to create a kind of leadership needed for future growth and development.”

“This is part of the Bank’s strategic objectives of infusing and developing leadership at requisite levels across its staff hierarchy, aimed at building the next generation of leaders who will be groomed to drive the Bank’s vision of being Africa’s Bank of first choice,” he concluded.

READ MORE: FirstBank takes its SMEs Business Clinic to Port-Harcourt, Abuja

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At the end of the programme, successful candidates are moved to middle management, becoming Management Associates irrespective of their grades at the point of entry.

Cross country postings and secondment opportunities are also offered to such staff to provide them with global exposure and network.

 

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About FirstBank

First Bank of Nigeria Limited (FirstBank) is the premier Bank in West Africa and the leading financial inclusion services provider in Nigeria for over 125 years.

With over 750 business locations and over 57,000 Banking Agents spread across 99% of the 774 Local Government Areas in Nigeria, FirstBank provides a comprehensive range of retail and corporate financial services to serve its over 15 million customers. The Bank has international presence through its subsidiaries, FBN Bank (UK) Limited in London and Paris, FBNBank in the Republic of Congo, Ghana, The Gambia, Guinea, Sierra-Leone and Senegal, as well as a Representative Office in Beijing.

The Bank has been nimble at promoting digital payment in the country and has issued over 10million cards, the first bank to achieve such milestone in the country. FirstBank’s cashless transaction drive extends to having more than 9million people on its USSD Quick Banking service through the nationally renowned *894# Banking code and over 3 million people on FirstMobile platform.

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Since its establishment in 1894, FirstBank has consistently built relationships with customers focusing on the fundamentals of good corporate governance, strong liquidity, optimised risk management and leadership. Over the years, the Bank has led the financing of private investment in infrastructure development in the Nigerian economy by playing key roles in the Federal Government’s privatisation and commercialisation schemes. With its global reach, FirstBank provides prospective investors wishing to explore the vast business opportunities that are available in Nigeria, an internationally competitive world-class brand and a credible financial partner.

FirstBank has been named “Most Valuable Bank Brand in Nigeria” six times in a row (2011 – 2016) by the globally renowned “The Banker Magazine” of the Financial Times Group; “Best Retail Bank in Nigeria” for seven consecutive years (2011 – 2017) by the Asian Banker International Excellence in Retail Financial Services Awards and “Best Bank in Nigeria” by Global Finance for 15 years. Our brand purpose is to always put customers, partners and stakeholders at the heart of our business, even as we standardise customer experience and excellence in financial solutions across sub-Saharan Africa, in consonance with our brand vision “To be the partner of first choice in building your future”. Our brand promise is to always deliver the ultimate “gold standard” of value and excellence. This commitment is anchored on our inherent values of passion, partnership and people, to position You First in every respect.

 

Folake Ani-Mumuney

Group Head, Marketing & Corporate Communications

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www.firstbanknigeria.com

 

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