The Independent Communications Authority of South Africa (Icasa) has reported that the subscription television market in South Africa is becoming increasingly competitive, which presents a serious challenge to MultiChoice’s long-standing dominance.
This insight is part of a discussion document detailing Icasa’s preliminary findings from a comprehensive inquiry into the country’s TV market, which involved public hearings and stakeholder feedback.
Icasa’s latest analysis reveals several factors contributing to the decline of MultiChoice’s market strength. Notably, the company has experienced a loss of subscribers for its pay-TV service, DStv, primarily due to a phenomenon known as “cord-cutting.” This term refers to consumers cancelling their traditional pay-TV services in favour of alternative streaming platforms, such as Netflix, which operate over the Internet. This is distinct from “cord-shaving,” where users can downgrade their traditional TV subscriptions while still utilizing them with streaming services.
Although specific figures regarding the loss of DStv subscribers were redacted from the document, MultiChoice’s annual report for the year ending March 31, 2024, indicated a drop in its active DStv subscribers in South Africa from 8 million to 7.6 million. Moreover, DStv Premium subscribers have now fallen below the 1 million mark.
In stark contrast, the number of OTT (over-the-top) subscribers has surged from 3.7 million in 2017 to 8.3 million in 2024, as per data sourced from Statista included in the document. This upward trend is largely attributed to the relatively lower costs of OTT services compared to DStv’s subscriptions and a significant reduction in the price of uncapped Internet services.
Icasa noted DStv’s efforts to enhance its appeal by bundling its OTT service, Showmax, Internet subscriptions and TV packages. The regulatory body’s findings also indicated that effective competition has emerged even with DStv’s dominance in sports broadcasting rights. However, it has yet to conclude whether this dominance results from a lack of competitive bidding or DStv outbidding its rivals.
Although Icasa’s preliminary findings underscore the significant competition DStv faces in South Africa, recent data from the Broadcasting Research Council of South Africa highlights a notable decline in traditional TV viewing. The latest Television Audience Measurement Surveys (TAMS) show a significant drop in viewership for popular TV shows and programs through linear broadcasting channels.
TAMS monitors the top 20 most-watched broadcasts on the free-to-air SABC and E-tv channels and the top 30 programs across DStv. Recent analysis reveals that total viewership for these broadcasts declined between October 2023 and October 2024.
For example, SABC 1, which had the highest viewership, saw a 6.61% drop in its top 20 broadcasts. The most-viewed show in October 2024, an episode of Uzalo, attracted 4.81 million viewers, down from 6.18 million for the most popular Uzalo episode in October 2023.
It should be noted that October 2023 experienced unusually high viewership for SABC 2 due to the broadcast of seven significant Springbok matches during the Rugby World Cup, including key knockout rounds. To provide a fair comparison with October 2024, MyBroadband adjusted the numbers by removing the match viewership and replacing it with an average from the other top shows. This adjustment revealed a year-over-year viewership drop of at least 27.37% for October 2024.
Meanwhile, S3 (formerly SABC 3) experienced an 18.2% increase in viewership, attributed solely to airing a Bafana Afcon qualifier in October 2024, the most-watched program with about 1.77 million viewers. When factoring out this qualifier and substituting it with average viewership, S3’s overall numbers decreased by 1.05%.
Despite these challenges in the industry, DStv’s top 30 programs in October 2024 witnessed a slight increase in viewership compared to the previous year, an impressive feat considering the overall decline in linear TV consumption and falling subscriber numbers.