Multichoice Cites Nigeria Economic Challenges for DStv Subscriber Drop

Multichoice attributes the decline in DStv subscribers on Nigeria's economy.

The company attributes the decline to economic challenges in Nigeria, including fuel subsidy removal, currency depreciation, inflation, and emigration of middle and upper-class citizens, leading to a 9% overall decline in active subscribers.

The African pay-TV provider Multichoice Group has attributed the 18% drop in active DStv subscribers in Nigeria to the country's economic situation.

This was mentioned by the business on Wednesday in its year-end financial report for 2024, which concluded on March 31.

The company reported that the decrease in Nigeria had an impact on its entire subscriber base, resulting in a 9% decline for the year.

Nigeria's total subscription amount was not disclosed because it is included with other operating units outside of South Africa and labeled as the “Rest of Africa” (RoA).

The total number of active subscribers in the RoA decreased by 13% to 8.1 million from 9.3 million in 2023 as a result of the 18% decline in Nigeria, according to Multichoice.

“The group's 9% decline in active subscribers was mainly due to a 13% decline in the Rest of Africa business as mass-market customers in countries like Nigeria had to prioritise basic necessities over entertainment, while the South African business showed more resilience with a 5% decline.

“The Nigerian economy and consumers faced persistent challenges through FY24. The removal of fuel subsidies, sharp currency depreciation with the official naira halving in value, inflation climbing to over 30%, and higher emigration of the middle and upper class drove an 18% YoY decline in active subscribers,” the company said.

According to Multichoice, this also caused Nigeria's revenue share in the Rest of Africa to drop from 44% to 35%.

It did point out, though, that given an inflation rate that is still more than 20%, Ghana had a similar subscriber trend.

Multichoice went on to say that its RoA (Redemption, Africa, Ghana, Kenya, and Zimbabwe) business has to refocus its short-term priorities from subscriber development to cash flow protection and profitability due to the difficult market conditions.

“Several cost-saving initiatives were implemented, including scaling back significantly on decoder subsidies (-46% YoY or ZAR1.3 billion), and reducing selling, general, and administrative (SG&A) costs by ZAR500 million. These interventions enabled the Rest of Africa business to increase trading profit by 48% YoY to ZAR1.3 billion,” it said.

Remember that a Competition and Consumer Protection Tribunal (CCPT) in Abuja granted an order barring the firm from implementing the new rates ahead of Multichoice's new subscription costs going into effect on May 1. The judgment was based on a lawsuit brought by a Nigerian customer.

 Multichoice was fined N150 million by the Tribunal for contesting the court's jurisdiction after it disregarded the court decision and went forward with the revised charges.

Nigerians were also given a free one-month membership to DSTV and GOTV by Multichoice, according to the ruling rendered by three members of the panel under the direction of Thomas Okosu.