MultiChoice sees off TopTV threat for now

Broadcast

MultiChoice added more than 360,000 new subscribers in South Africa  in the six months to 30 September, handily beating its new rival On Digital Media, which launched TopTV in May.

Interim financial results from media group Naspers, which owns MultiChoice, show that the pay-TV operator added 498,000 during the six months from April to September across its Africa operations.

In South Africa, the gross base expanded by 363,000 to 3.2m households. Most of the growth came from the lower-priced Compact bouquet. In the rest of sub-Saharan Africa, the base grew by 135,000 to 1.2m homes.

Naspers says the strong growth is attributable mainly to the 2010 soccer World Cup. But decoder subsidies and extensive marketing also boosted the numbers, the group says. The growth spurt caused by the World Cup will not recur soon, Naspers says.

The solid performance in South Africa, however, easily beat the number of TopTV subscribers signed up by On Digital Media. Though On Digital Media doesn’t disclose subscriber numbers, it’s believed to have in the region of 100,000 paying customers. The subscriber growth at MultiChoice meant Naspers reported a increase of 20% in pay-TV revenues, to R10.2bn.

However, operating margins came under pressure due to cost pressures from growing the subscriber base as well as “intense competition” and increased costs to acquire sports rights. On the recent launch of DStv Mobile in South Africa, Naspers says it regards this as an “experimental service that will incur losses for many years”.