Multichoice has revealed that the Pay-As-You-Go (PAYG) billing model advocated by Nigerians is not technically and commercially feasible in addition to being impossible.
This disclosure was made by the Chief Executive Officer of MultiChoice Nigeria, owners of DSTV, John Ugbe, when he appeared before the House of Representatives Ad Hoc Committee investigating the non-implementation of Pay-As-You-Go subscription model by satellite television operators.
While pointing out that the company does not have the technology to offer pay as you go at the moment, Ugbe pointed out that Pay-Per-View (PPV) is often confused with PAYG, adding that the PAYG model used in the telecommunications sector is not the right fit for pay television.
The Multichoice boss, in clearing the air between PAYG and PPV, explained that Pay-As-You-Go in telecommunications is a metered service that ensures consumers are billed only for the service they consume and not for a fixed period.
He argued that Pay-As-You-Go is possible in telecommunication sector because it relies on a two-way communication system, which enables operators to determine when a consumer is connected, the service consumed and the duration of connection.
However, unlike telecommunication firms, he maintained that satellite broadcasters, cannot offer pay television services because satellite broadcasting is a one-way system and does not enable broadcasters to determine when a subscriber is connected and/or watching or what channel is being viewed.
Ugbe said: “It is only in instances where there is two-way communication between the device at the subscriber’s home and the headend of the pay-tv service provider, which will enable the provider to determine when a subscriber is connected or not, that a billing system could be designed to take into cognizance the subscriber’s behaviour.’’
He said the Pay-As-You-Go can only be feasible if there is a total and global remodelling of the satellite broadcasting technical and billing architecture, adding the result will be that consumers will have to much higher tariffs to access the service.
He said, “The economies of scale model employed by broadcasters mean that subscribers pay less. We are yet to see a pay-TV business anywhere in the world that does PAYG in the sense intended here. We do not believe the model is technically or commercially feasible.’’
He maintained that Pay-Per-View, is however different from PAYG and more expensive, as it entails a broadcaster transmitting a single event at the same time to its subscribers who have paid to watch the event.
He pointed out that, “A subscriber who wants to watch an event on PPV is required to pay an additional fee besides his subscription. A typical example would be the Mayweather and Pacquiao, and Wilder and Fury II boxing bouts which were retailed on PPV in the United States for $100 and $79.99 respectively.
“The Mayweather/Pacquiao bout, which was shown on DStv premium bouquet, would cost N38,000, which would far exceed the cost of any of the DStv bouquets. The bouquet or bundling model is an effective and efficient means of providing a large but still manageable variety of choice to satisfy consumer demand for entertainment, at the lowest possible cost to consumers,” he said.
The Pay-as-you-go debate has been a subject of a tussle between Multichoice and the House of Representatives. The Federal lawmakers had investigated the cable satellite firm over high tariffs and alleged cheating of its Nigerian subscribers coupled with the refusal to introduce pay per view.
However, despite Multichoice’s insistence on the impossibility of pay-as-you-go, another cable satellite firm, StarTimes Nigeria, had announced that it had already integrated a flexible subscription plan where customers do not have to pay for what they do not get.
A top official of the firm, disclosed that it allows subscribers to choose daily, weekly, monthly or quarterly plans and enjoy all exciting content on their preferred package/bouquet valid for the period paid for.
The secret to Tyler Perry’s $1billion dollar empire
Tyler Perry went from sleeping in his car after flopped shows to becoming a billionaire entertainer.
Over the years a distinct class of sectors has been noted for producing the most billionaires. When you go through any rich list you are most likely to find these sectors fully represented and leading the park. According to Visual Capitalist, these following sectors produced the most billionaires from 2009 to 2020.
- Health industries
- Real estate.
Where is entertainment?
Despite the luxurious lifestyle of high flying celebrities, The entertainment industry has hardly been a billion-dollar sector for entertainers. Most famous celebrities with millions of followers around the world are nowhere close to a billion-dollar net worth. Entertainers have always struggled with finances after their peak years while some ended up in debt. But recently there has been a slight break away from the norm. Some entertainers are finding new ways to climb the money tree and are succeeding at it.
Tyler Perry belongs to a distinct class
According to Forbes, there are very few entertainers who ever get to make it to the billion-dollar club. When eventually they make it there, it is hardly from their craft. For example, Kanye West made it to the billion-dollar circle from a partnership deal with Adidas, not his music. Forbes stated that Kanye West’s entire music catalog is worth a paltry $90m.
Jay Z made it to the circle from a series of investments that cut across various sectors.
Tyler Perry belongs to a unicorn class of entertainers who achieved a billion-dollar net worth solely from their craft.
Tyler Perry’s journey to riches
Tyler Perry went from sleeping in his car after flopped shows to becoming a billionaire entertainer. In an exclusive interview with Forbes, he shared his personal journey and struggles to feed and pay rent.
Perry dropped out of high school. He did not attend any business school. He worked odd jobs to get by while performing his shows for a meagre crowd. Tyler Perry explained to Forbes that he had to work in hotels, sell cars and collect bills.
$12,000 seed money
Perry kicked off his production with $12,000 he saved from his many odd jobs. He used the money to rent space at a community theater in Atlanta to produce a work he had drafted in his spare time.
He kicked off his career from there, touring and performing his debut drama “I knew I have been saved” in different cities. It wasn’t rosy and couldn’t pay the bills. He had to sleep in his car for 3 months at a time.
In 2001 he was invited by Oprah Winfrey to her popular talk show and that was when his special relationship with Oprah Winfrey started.
Oprah Winfrey’s billion-dollar advice
Perry revealed to Forbes how much of his business success he owes to Oprah Winfrey’s advice. Perry revealed that he was advised by Oprah Winfrey to own his entire operation. Perry owns a sprawling 330-acre Tyler Perry Studios in Atlanta. He produces his own content and owns 100% of it.
Forbes credited this strategy as the silver bullet that landed Perry in the billion-dollar circle. According to Forbes, Perry started earning a pretax income of $1.4 billion in 2005.
Tyler Perry current net worth
According to Forbes, Tyler Perry officially became a billionaire in 2020. He is currently worth $1bn.
He joins a distinct class of entertainers who reached a billion-dollar status solely from their craft.
What you should know
- Tyler Perry famous character Madea – an elderly Black woman – made him a total of $290m, according to Newsweek. The Madea Franchise consists of 14 movies spanning a period of 11 years.
- He gets paid $150m every year for fresh content by media giants Viacom CBS, according to Newsweek.
- He owns his entire means of production and often rents it out to other production companies. This is believed by Forbes to be his key comparative advantage over other entertainers.
How Kanye West became the richest black American with $6.6 billion net worth
Kanye West officially became a billionaire six times over following remarkable deals with Adidas and Gap.
Kanye West’s decision to go into the apparel business in 2009 has etched his name on the sands of time. The Chicago-born rapper and businessman is now worth 6.6 billion making him the richest black American on earth according to Bloomberg.
This new information was revealed when a reputable Swiss investment bank UBS Group AG released an official document on the new Kanye West deal.
The document was obtained and reviewed by Bloomberg before it was made public. The latest Kanye West Yeezy deal involves two of the world’s biggest names in the apparel business – Adidas AG and Gap Inc.
History-making Deals with Adidas and Gap
According to Bloomberg, West latest deal with Adidas AG and Gap is valued at $3.2 billion to $4.7 billion by UBS Group AG.
West’s new clothing line for GAP is expected to cost $970m from the total of the deal.
According to Bloomberg the deal was signed last year and is expected to last for 10 years. West is expected to make clothes for men, women, and kids under the Yeezy Gap Label.
The Gap management is expecting to hit $150m in sales at the ending of 2022 and over a billion dollars in 8 years.
The apparel brand hopes to appeal to the younger demographic by bringing West on board.
When Kanye West struggled with debts
The financial journey of Kanye West over the last decade is marked with up and downs. He has gone from numbing lows to astronomical heights in one of the most unstable financial paths ever seen.
According to Fox News, West made $115m in 2018 but still ended the year in a $35m debt. He was saved by a $68m Tax refund.
Earlier on in 2016, Kanye West spoke to BET on his debt status and his current struggles in the apparel industry. He racked up a $16m debt trying to float his apparel brand.
“I was trying to play a sport that’s a billionaire sport. It’s not a millionaire sport and I’m proud of the debt,”
“I don’t care about somebody’s Ghost (Phantom) or somebody’s house. I care about my vision,” he said.
In 2015, West announced via his Twitter page that he was in a $53m debt. This was confirmed by Vanity Fair which alleged that he racked up the debts pursuing his fashion Industry goals.
He once asked Facebook founder Mark Zuckerberg to invest $1bn in his fashion apparel.
- According to Bloomberg, an unedited balance sheet of Kanye West’s finances revealed that the rapper was earning $100m in royalties from his Adidas business venture.
- In addition to that, he earned over $122 million in cash and stock and more than $1.7 billion in other assets.
- A 2020 valuation by a US-based valuation company placed his entire music catalog at $110.5 million.
- His latest deal with Adidas is worth between $3.2 billion to $4.7 billion. His second deal with Gap is valued at $1billion.
- Forbes officially named Kanye West a billionaire mid-last year and attributed this status to his 100% ownership of the Yeezy brand.
- According to Celebrity Net worth, West is now officially the richest black American at the moment. At 6.6bn he has successfully displaced Robert F. Smith’s, David Steward’s, and Oprah Winfrey to clinch the top position.
What you should know
- Kanye West owns 100% of the Yeezy Brand. A smart move that has been hailed by most business analysts. West did not sell the brand to any of the major shoe brands in the industry. He solely owns the brand, while Adidas just makes the shoes and distribute them.
- According to Bloomberg, the Yeezy Sneakers are Kanye West’s most successful apparel business brand. The Swiss investment bank UBS attributed to this in their official statement where it confirmed that the sneaker business is growing at an alarming rate.
- According to the UBS, Kanye netted $191 million in royalties from his 2020 operations.
Nairametrics | Company Earnings
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