By Kelechi Deca
This is not the best of times for Africa’s leading cable television giant, MultiChoice Group as it expects a sharp decline in reported trading profit for the year ended 31 March 2025, while trying to navigate the murky waters of existential pressures. Just as the company was coming to terms with a series of price controlling measures by governments in some of its key markets across Africa, forex woes and Showmax costs are pushing the company into rough waters in what company insiders describe as factors beyond its control.
Pay television was launched in Africa in 1986 by Naspers South Africa in collaboration with a few local companies as M’Net Africa with a single-channel analogue service. For almost seven years, all of M-Net’s operations were handled by a single dedicated company until 1995 when a second subsidiary company, MultiChoice, was launched. Multichoice took over M’Net’s operations including decoder sales, subscriber services and account management and within the same year, started expansion into other African countries. To say that Multichoice laid the foundation, and transformed pay television services in Africa would be an understatement. It did more than that. And over the years, it has remained at the forefront of pushing African culture and contents to the world.
Unfortunately, in the last few years, the company has been jumping from one problem to another while navigating to remain relevant in the face of changing operating environments and stringent government regulations. Close watchers are in agreement that one of the biggest challenges facing the media giant is its unique market-Africa, where government interference in price capping is seen as a pro-people populist move with consumers always looking up to their governments to maintain tight grips on prices. However, analysts have frowned at this tendency by some African governments to adopt price capping as a regulatory strategy instead of creating enabling environments for competition to thrive thus attracting more competitors.
With running battles with governments in Nigeria, Ghana and Malawi over pricing, there is the tendency that more countries will join the queue in demanding for either price cuts, or moratoriums on price increment and this is irrespective of a more than friendly operating environment that puts pressures on service providers amid disruptive competitions.
All these demands come as MultiChoice is under pressure, having lost revenue and subscribers in the financial year that ended March 31, 2025. In June, the company announced its financial year-end results. In a statement to shareholders the company said the past two financial years have been a period of significant financial disruption for economies, corporates and consumers across Sub-Saharan Africa due to challenging macro-economic factors.
Since 2023, Multichoice has been having a running battle in Nigeria with the consumer protection agency over pricing. Things got to the head last year when the company went to court over the issue. The government of Ghana ordered MultiChoice Ghana to reduce DSTV subscription costs by 30%, noting the significant appreciation of local currency and growing dissatisfaction with current rates.
The Ghanaian authorities are of the view that despite a 30% increase in the cedi’s value over the past five months; DSTV prices have not reflected the positive economic trend, thus the demand that a 30% price reduction to match the cedi’s appreciation and to pass on economic benefits to consumers. A demand MultiChoice said it is committed to provide input emphasising the need of balancing public interest and business sustainability.
In Nigeria, Multichoice has been fighting more complex battles. First was the price fixing war which brought the National Assembly into the fray. The Federal Competition and Consumer Protection Commission (FCCPC) which is Nigeria’s competition commission sued the local unit of MultiChoice Nigeria Limited (MCGJ.J), for violating regulatory directives. The FCCPC earlier asked MultiChoice Nigeria to maintain its pricing structure for its pay-TV business DSTV and GOtv pending the conclusion of a review of its proposed price hike. It claimed that despite the directive, the company proceeded with its price increase on March 1, 2025, in clear defiance of the commission’s directive, the FCCPC said.
As a result of the above, the FCCPC filed charges against MultiChoice Nigeria at the Federal High Court, Lagos Judicial Division, on three counts of offences for willfully obstructing the commission’s inquiry by implementing a price hike contrary to directives. Interestingly, this came on the heels of an agreement reached between Nigeria’s Federal Inland Revenue Service (FIRS) and MultiChoice Group in 2024 in a settlement that cost the media group about $37.3 million.
As if that was not enough, the Nigeria Data Protection Commission (NDPC) recently slammed a fine of ₦766,242,500 on Multichoice Nigeria for breaching the Nigeria Data Protection Act (NDPA).The NDPC said that in an investigation which has been ongoing since last year, it found that Multichoice Group breached privacy rights of its subscribers and illegal cross-border transfer of personal data of Nigerians. The data regulatory agencies note that Multichoice violated the data privacy rights of subscribers and their friends who are not necessarily subscribers in a way it described as patently intrusive, unfair, unnecessary, and disproportionate. This is a grave affront to fundamental right to privacy as enshrined in Section 37 of the 1999 Constitution of the Federal Republic of Nigeria.
When all the above are added to the ongoing impact of structural industry changes in video entertainment, such as the rise of piracy, streaming services and social media, then it gets clearer how deep and murky the Sharks infested waters Multichoice has been struggling to navigate is. These are why the overall performance of the group is not looking good. Within the year under review, MultiChoice said the group lost 2.8 million active linear subscribers and had to absorb a R10.2 billion negative impact on its top line due to local currency depreciation against the US dollar.
For the year, the company reveals that linear subscribers were down 1.2 million, or 8% year-on-year, to 14.5 million active subscribers, with the loss evenly split between South African (600 000) and the rest of Africa (600 000).
Reported trading profit, including the impact of currency movements against the rand across many of the key African markets in which it operates, will fall by about 50%, stripping out the impact of forex translation effects and other changes, “organic” trading profit will decline by between 7% and 11%, says company sources.
While the earnings-per-share line will show a swing from a R9.35 loss last year to a profit this year, the jump is not the result of a stronger underlying performance but is instead due to corporate actions such as the sale of a 60% shareholding in NMS Insurance Services to Sanlam in November 2024 and a downward adjustment to a Showmax put option liability. Headline earnings per share will also do better than a year ago, rising by as much as 66%. However, the underlying operational performance of the business, which is the subject of a takeover bid by France’s Groupe Canal+, does not look good.
All these add up to push Multichoice between the rock, and a very hard place.
How it manages to extricate itself from the barrages of darts being thrown at it from all sides in the next 12 months would define not only its sustainability, but its very existence.
Kelechi Deca, a journalist and public affairs analyst writes from Lagos.
