Despite constant assertions that the decline in its valuable Premium segment has been ‘slowing’, the pay-TV operator continues to haemorrhage subscribers.
Since March 2021 – in just three years – it has seen a cumulative 17% decline in the number of subscribers on this package.
In its results presentation for the year to end-March 2024, it says it is “reducing the rate of decline”.
Source: MultiChoice
However, the number of subscribers on this package has dropped at a regular rate of between 5% and 6% post Covid-19.
The slight slowdown is to be expected, however, given the impact of the Rugby World Cup at the end of 2023. This kept customers and possibly even added a pool of ‘temporary’ subscribers (possibly lapsed ones) who would’ve otherwise not been active.
MultiChoice says it had a total of 8.5 million total linear viewers of the tournament from an active base over a 90-day period of between 9.3 million at the start of the year and 8.6 million at the end of March.
Practically, almost every active DStv subscriber watched at least one Rugby World Cup game, likely one that involved the eventual winners, the Springboks.
The group has told the market in no uncertain terms that its strategy is to get more revenue from its base, which is not growing (it uses terms like “tap into adjacent revenue opportunities” and “building a portfolio of digital products, layered on top of the traditional linear base”).
Its fiddling around the edges of the core South African base continues to yield results.
In the last 12 months, it generated almost R1 billion in revenue from decoder insurance policies.
It doesn’t disclose ‘DStv Internet’ customers (effectively reselling MTN products) but active users nearly doubled over the past year and revenue is up 160%.
The Extra Stream product, which allows subscribers to buy an additional mobile stream for a price dependent on their tier (streams are limited to one per subscription), has seen active users up only 13% between September and March, which is lower than one might expect. Much of the uptake was likely in September as the RWC got into gear.
Declines across all segments
The group reported declines across all its segments: Premium (Premium and Compact Plus) was down 8%, Mid-market (Compact and commercial subscriptions) saw a 9% decline and Mass-market (Family/Access/EasyView) was 2% lower. The last of these is predictable as there are sizeable Access and EasyView bases who pay R139 and R29 per month, respectively.
Given that the Premium segment (not to be confused with DStv Premium packages alone) was down 8% and the number of subscribers on DStv Premium was 5% lower, this suggests that DStv Compact customers are likely down in low double digits. This has always been positioned as an ‘upsell’ package for the mass DStv Compact base which has subscription TV for the PSL and Mzansi Magic (and other local programming).
It took its lowest price increase in the Mid-market segment (up 4.5% versus Premium’s 5.9% increase and a 6.5% jump for Mass customers), as this is arguably the most price-sensitive base given inflationary pressures and the price of the bundle (R469 per month).
Of concern to the group, surely, is that the number of so-called ‘active days’ per subscriber is now at a paltry 247.
Mid- and mass-market customers aren’t always active. The number of active days per subscriber across its South African base is down by 22 from last year, with 247 equating to a full four months where subscribers simply aren’t active or, importantly, paying!
The end result of traditional subscribers abandoning DStv Premium for a cheaper package or cancelling their subscription altogether is that they are reliant on public venues such as bars, pubs, taverns and restaurants in order to watch major sporting events. MultiChoice knows this and it hiked the pricing of its ‘DStv Play’ package for commercial establishments in March 2024.
Its ‘Play Ultra’ bouquet, which contains all sports channels, now costs R1 200 per month per television. A ‘mid-level’ Play Essential package is R900 per month, while its Play Basic tier is R400 a month. The latter is targeted exclusively at taverns, and has very few SuperSport channels bundled, save for SuperSport PSL, La Liga and Football (no Premier League). It is no wonder that total revenue from these Play packages is up 32% from before it made the “price adjustments”. – bbc.com
