Stage 6 load-shedding hurts DStv in South Africa

MultiChoice CFO Tim Jacobs said a direct correlation exists between increased load-shedding and a decline in active DStv subscribers. Still, there are positive signs for the pay-TV operator.

Jacobs shared information about the impact of load-shedding on the DStv subscriber base in South Africa during MultiChoice’s inaugural capital markets day.

At the event, MultiChoice CEO Calvo Mawela said they have excellent opportunities in Africa to grow the company into a larger and more valuable business.

He said the MultiChoice of Tomorrow would offer video entertainment, interactive entertainment, fintech services, and home services.

Apart from offering linear TV and streaming products, they expanded into sports betting through Kingmakers and the soon-to-be-launched SuperSportBets.

Their fintech products include Moment in partnership with Rapyd and General Catalyst and DStv Insurance.

MultiChoice also offers home services, including DStv Internet for connectivity and Namola for on-demand emergency response services.

While the new products are showing good growth, MultiChoice currently makes most of its money through its DStv offerings.

South Africa, where MultiChoice generates most of its earnings, is under significant pressure because of load-shedding.

Jacobs told investors that load-shedding affects their DStv subscription rate, especially when it hits stage 6.

“We see a direct correlation between the level of load-shedding and the impact on its DStv customers,” he said.

When load-shedding hits stage six, there are two things they notice.

• Viewership across the linear TV industry drop by 34%. On the DStv platform, it only drops by 12%.
• There is a decline in active DStv subscribers.

Curiously, despite a decline in active DStv subscribers when load-shedding escalates, there is still growth in 90-day subscribers.

“What that tells us is that, although people are under economic pressure and decide when to pause their subscriptions, they still want to be on the platform,” he said.

It shows that the DStv product still resonates with customers and that there is still growth in the market.