MultiChoice, the pay-TV broadcaster, has suffered a significant blow in South Africa, losing nearly half a million DStv subscribers in the past year, according to the company’s latest interim results for the first half of the 2023 financial year.
As of the end of September 2023, the number of active subscribers in its country of origin stood at 8.629 million, a decrease of 486,000 compared to the same period in 2022.
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MultiChoice attributed the majority of its subscriber losses to the discontinuation of pricing promotions that were launched in 2022 to provide financial relief to customers during load-shedding hardships.
The company stated that while it has supported its subscribers with similar campaigns during challenging periods like the Covid-19 lockdowns, such support can only be provided for limited periods of time.
As a result, 311,000 non-revenue generating customers on temporary “Surprise and Delight” offers were removed from DStv’s 90-day active subscriber base, accounting for 3% of the total 5% decline.
In addition to the pricing promotions, increased load-shedding was identified as another major factor contributing to MultiChoice’s subscriber decline.
Despite this, the company managed to limit the decline in monthly average revenue per user (ARPU) to 2% through more stable trends in its mid and upper customer segments, as well as inflation-linked average price increases of around 4%.
DStv categorizes its subscriber base into three main segments: the Premium segment, the mid-market segment, and the mass market segment.
The Premium package, which has been experiencing a decline for several years, saw a temporary 5% increase in subscribers, possibly driven by sign-ups for the 2023 Rugby World Cup.
However, the overall Premium segment, including Compact Plus, experienced a decline of 5%. The mid-market segment suffered a significant drop, with a 14% decline in subscribers, while the mass market segment only lost 1% of its subscribers.
It is worth noting that customers with the Premium package are more likely to have access to uncapped broadband packages and video streaming services, which have become strong competitors to traditional TV services. This trend has contributed to the decline in the Premium segment over the years.
MultiChoice’s interim results for the 2023 financial year highlight the challenges the company faces in retaining subscribers in the ever-changing media landscape.
With the rise of alternative streaming platforms and the impact of external factors such as load-shedding, MultiChoice will need to adapt its strategies to stay competitive and meet the evolving needs of its customer base.
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