Last week, MultiChoice Uganda announced a 25 per cent subscription cost increment on all their DStv bouquets.
In an interview in Mauritius where MultiChoice Africa hosted a content showcase last week, TIM JACOBS, the pay TV service provider’s new CEO, talked to Carolyne Nakazibwe about that and more.
Mr Jacobs, you became MultiChoice’s chief executive officer in April. What were you doing before then?
I was the video entertainment chief finance officer [at MultiChoice]. I was on the finance side.
The big deal in Kampala now is digital migration, which has left no room for analogue TV. This has brought cheaper, even no-subscription players on the market. How is MultiChoice coping?
We are a pay TV operator and we are always going to come up against competition. That is normal in any market. There is always an audience going to the free-to-air channels. What we do is to provide access to all the free channels and in addition you get all the value-added channels. We believe we have a very good offering in the Go-Plus [package].
The consumers in Kampala are resonating with what we are putting there as well. The problem with DStv is that when the month ends, the free-to-air channels go off with the rest of the international channels. Every company makes commercial decisions and has a business strategy that suits their long-term vision…
Isn’t it a legislative broadcast requirement for all pay TV service providers to provide uninterrupted access to free-to-air channels?
As far as I understand, if it were a legislative requirement to show a channel, then it would be shown. That is not a requirement; we are a pay TV company.
We are offering a low-price package [GOtv Light], but DStv is a premium package and we thought very carefully how to structure that. At the moment we don’t offer a free viewing experience.
Media reports say 65 per cent of your Ugandan subscribers are actually on GOtv. Wasn’t it shooting yourself in the foot, introducing a cheaper package, if DStv subscribers are downgrading to GOtv, which has good content?
I don’t think that is correct. We look at our subscriber numbers quite carefully and yes, there are always people who want to move off the Premium channel, but once you are on DStv and get the full range of all of our programming, most consumers agree that it’s a compelling offer: the sports channels, the movies, the series, the language channels…I’d be very surprised if we saw mass migration from one platform to the other.
This month the cost of the bouquets has gone up 25 per cent in Uganda where your subscribers were already finding the prices high; they will probably not understand what more you are giving them to justify the increase.
Unfortunately this price increase is directly linked to the [depreciation] of currencies. Where countries in Africa have not experienced depreciation, we have not put a price increase. We have tried to hold on – the currencies have been moving for some time now – and we have absorbed as much of the cost as we could.
In Uganda, we have seen multiple steep changes in the [depreciation] of the currency and of course MultiChoice is a dollar-based business. Most of our imports are dollar-based. This was a necessary, unavoidable business decision. But if the Uganda shilling starts to strengthen again, then the commitment we have made is to pass those savings back to the consumer.