A member here commented on the need of data to understand how MultiChoice with its DStv and GOtv is playing Nigerians. Sure, I do not have access to the company’s financial record. What I can lay my hands on is the publicly available TV rights in Europe. European football is the one oasis of the MultiChoice business model in Nigeria.
Poor MultiChoice, the owner of DStv and GOtv: “The Competition and Consumer Protection Tribunal has fined prominent Pay-TV operator Multichoice Nigeria N150 million for disobeying its order on a case involving subscription price increases for DStv and GOtv packages. The tribunal, led by Justice Thomas Okosu, also ordered Multichoice to offer Nigerian customers a one-month free subscription.”
The plot below has the value of Premier League media rights deals from 2007 to 2025, by region. Notice that the international deal has never been reduced. To make this analysis easy, let us compare the 2016-2019 and 2022-2025 periods.
For the 2016-2019 period, Naira was at N167/$ in 2016 but continued to move up to N397/$ which is at least a factor of 2 increase. For 2022, it began around N415/$ but has gone up to N1,400/$ which is about 3x. So, just on the currency loss, if MultiChoice is to recoup what it paid in 2022 for the new rights, prices would have to go up by a factor of 3 considering that it is not signing up more customers as a result of the economic paralysis in Nigeria!
Tekedia Mini-MBA edition 15 (Sept 9 – Dec 7, 2024) has started registrations; register today for early bird discounts.
Tekedia AI in Business Masterclass opens registrations here.
Join Tekedia Capital Syndicate and invest in Africa’s finest startups here.
Of course, that company cannot impose a 3x increase since even the customers are victims of this forex mayhem. This imbalance is the reason the company lost $190 million in the latest result in Nigeria.The increase it is pushing which the court blocked is nothing when you look at its business numbers. So, while other 800 companies have shut down, MultiChoice could have joined except that the nature of its products do allow it to increase price easily. But where that is not possible, because of the court, we will all return to Enyimba FC, Kano Pillars, etc which may not even be bad.
That said, the fact that I have to do this is a validation that MultiChoice is not a great communicator. The illusion in Nigeria is that DStv’s parent company is profitable even though it is losing money. Someone must find ways to make that case before the customers: if we cannot raise prices, we may have to shut down! The customers are reasonable!
I write this because every court case against MultiChoice has always moved fast. This latest one started in May, and by June, we have a result. But more important business cases have been going on for years in our courts with no ruling. So, if MultiChoice motivates our courts and the judges, MultiChoice can even license its name so that you can add MultiChoice somewhere in the filing so that you can get justice faster! This is a MultiChoice Factor!
---
Register for Tekedia Mini-MBA (Sept 9 – Dec 7, 2024), and join Prof Ndubuisi Ekekwe and our global faculty; click here.