It hasn’t been this interesting in the pay-TV industry in a long time. Scratch that, it has never been this exciting in the pay-TV space in Africa.
After years of being starved of proper choices and alternatives everything seems to be falling into place. As Zimbabweans we actually envy the Kenyans who have the other alternative that is StarTimes.
This is all good news for us as consumers. For the players themselves it means sleepless nights as they tweak their models to better compete. There are limited potential customers to entice and it has become a brawl.
The latest jab comes from StarTimes Kenya. They have reduced the price of their set top boxes (decoders) by 25%. Neat strategy isn’t it? Reduce the barrier to getting access to your offering and make up for it in subscription fees.
This comes from realising the economic challenges most Africans are facing right now. When disposable income is as low as it is across Africa and entertainment is a luxury people are generally not too picky about the quality of content. They just want some form of entertainment.
If you ask people to shell out a fortune for the priviledge of acquiring a set top box you are being unreasonable. StarTimes realises this and thus the price reduction.
Kwese is implementing a similar strategy if you think about it. They are offering new subscribers the first month free if they purchase a set top box and dish set. They realise that for a new subscriber to pay for the set top box and first month’s subscription all at once may be a big ask.
They just decided to say that what you are paying for is the set top box and getting the subscription free. They could just have switched it up. All they are doing is discounting their offerings so that it is cheaper for potential customers to get started with Kwese.
That’s why it confused us when Kwese Play launched in South Africa with an expensive Roku-powered streaming set top box. The plan is to get these set top boxes in people’s homes and then hopefully get a subscriber for life, or at least for the foreseeable future.
DStv have multiple set top boxes, priced differently depending on features available. This allows them to offer things like PVR features and HD channels to those who can afford it but for the low income earners there is a cheaper basic set top box so that we can all join the DStv family.
The battle is being waged on subscription fees too. In the past few months DStv has revised their prices down several times. They have also introduced DStv Lite here in Zimbabwe. That was a genius move if the conversations I had with some people are indicative.
When I asked some people if they would try out Kwese when it came out, I got responses like, ‘it is too expensive because DStv allows me to pay only $11 for a month’s entertainment.’ That was before the $7 Lite package was introduced, I imagine they are even more ecstatic.
Kwese’s strategy involves allowing people to pay less to get the same content for fewer days. They know we have limited funds and cater to those casual TV watchers among us.
You might not need access for a month as you only really watch TV on the weekends. You only pay for those three days and get access to the full catalogue of channels Kwese has to offer. You pay $5 for three days access to all channels and you have more payment options.
As you can see you pay $5 for three days access but if you were to add $2 you would be able to get DStv Lite for a full month.
DStv Lite will provide you with bare bones entertainment, just a few channels but for 30 days. Kwese will give you better content for a shorter period.
Different strategies and both catering to particular consumers. For a more detailed content comparison click here.
When it comes to content we have the very vocal group of sport fans. They need particular content and are willing to pay for it. For football fans DStv reigns supreme and for American sport lovers, Kwese cannot be touched.
So the strategy is to have the content that people want to watch and are willing to pay for. DStv paying billions to acquire EPL rights being an example or Kwese partnering with VICE.
Problem with the content strategy is that, as mentioned the tough economic conditions mean people are not too worried about the quality of content as long as it can distract them from their lives.
So after paying billions to acquire sports content and people only subscribe for the $7 Lite package means trouble for DStv. That could partly explain why DStv (Naspers) has practically been making losses for the past two years. So while the sports lovers are very loud, apparently there are not too many of them.
What is important to you?
Are you in the camp that want to pay the least amount possible and are not too worried about the quality of the content?
Or are you one for those who would pay an arm and leg for what they actually want to watch?
Seeing as most Africans are facing various economic and financial problems, which strategy do you think will yield the best results? – TechZim