Naspers, Africa’s biggest company by market value, said on Friday that its satellite payTV service DSTV lost 288,000 subscribers in the last one year as more people were not able to afford the service, the company’s chief executive said.
Bob Van Dijk told Mail & Guardian Africa the South African-based company decided to freeze its payTV prices as it expected the next few years to be difficult in Africa and was “on the lookout” for potential acquisition targets to grow its internet business internationally.
Internet business accounts for about 70 percent of Naspers annual revenue.
DSTV, which Nasper owns through its subsidiary MultiChoice Africa, was forced to hike its prices in 2015 when several African currencies fell against the dollar as a commodities prices rout hurt economies on the continent.
This move did not go down well with many of its customers who are also being courted by increasing on-demand internet TV service providers, including US-based Netflix.
“We have also lost a lot of subscribers in the last year in sub-Saharan Africa, people have just not been able to afford it,” Van Dijk said.
“We bill in local currencies, but our costs are in dollars. It is quite painful when the currencies are running in the wrong direction.”
In April, MultiChoice Africa announced that it will for the first time in several years not adjust DSTV prices upwards for 2016, Sunday Standard reported.
The rate hike moratorium was effected in recognition of the fact that most African markets have suffered as a result of commodity and oil price weakness and because of the significant devaluation of local currencies.
In May, Naspers launched its internet-TV and video streaming service ShowMax in 36 African countries in a bid to counter Netflix entry into the continent.
US-based Netflix, which has over 65 million streaming customers in over 190 countries worldwide, announced its entry into Africa as part of a global expansion plan that included 130 countries earlier this year.
