PwC has released its latest entertainment and media outlook for 2018.
The report offers an in-depth analysis of the trends shaping the entertainment and media industry in South Africa – with forecasts built from a collection of historical data from a variety of sources.
“South Africa faced an eventful year at the political and macroeconomic level in 2017, but emerged early in 2018 with a new president viewed as market-friendly and vowing to overhaul the economy,” PwC said.
“The entertainment and media (E&M) world does not, however, operate in a vacuum, and with advertiser confidence particularly hit in 2017, total E&M revenue rose at a comparatively low rate of 6.8% year on-year to R129.2 billion.
“By comparison, in 2015 and 2016, rates of 12.8% and 9.2% respectively were seen, although they were in large part driven by rapid internet access growth. However, there are better prospects ahead. A bounce back in 2018 sees an anticipated 7.6% year-on-year growth, while the CAGR to 2022 is forecast at 6.5%, leaving total E&M revenue at R177.2 billion in that year,” it said.
As expected, TV and video will be significant drivers of consumer revenue, PwC said.
“Internet video’s success continues to grab the headlines here but, in the short term at least, the likes of Netflix and Amazon Prime will likely be taken as a complementary service due to their dearth of premium entertainment content in the South African market.
“Pay-TV revenues will add R6 billion in absolute terms to 2022 at a 5.0% CAGR, even though by 2022 year-on-year growth will have slowed to 2.6%.
“Indeed, with a cultural shift towards viewing content when and where audiences desire, aided by ubiquitous fast internet services – in the longer term some households might look to supplement their digital terrestrial channels with SVOD platforms rather than traditional pay-TV packages.”
“The arrival of OTT platforms like Netflix and Amazon Prime Video provides Naspers’ MultiChoice with competition, but the latter’s access to premium sporting rights and major entertainment content means that in the short term the newcomers will most likely be taken as a complimentary service, which will leave the pay-TV market little changed,” it said.
“In the longer term, after the analogue switch-off, some households might look to supplement their digital terrestrial channels with subscription video on demand (SVOD) platforms rather than traditional pay-TV packages.”
“MultiChoice has expanded access to its ShowMax OTT platforms but looks set to launch a streaming version of DStv in 2019.”
Speaking to MyBroadband on Wednesday (19 September), Calvo Mawela, the CEO of MultiChoice South Africa said that his company was getting ready to launch a ‘dishless’ product – but would not provide further details.
This follows comments he made in May, where Mawela said that their standalone streaming package is still a work in progress.
He added that the company is waiting for DStv’s digital media division to come up with a full commercial plan for the service, along with an activation date, he said.