So this company is owned by largest South African cable network and has extensive partnership with Comcast and HBO. Further adjusting purchasing power of local consumers and ton of local content they'd have acquired over decades I am not sure what is expected.
To me takeaway it is impressive that Netflix still has more that 30% of marketshare.
I see same thing in India where *analysts and experts on twitter opine how Netflix has totally failed in India due to lack of local content and poor execution. Instead of accepting that for >90% of population Netflix is just too expensive and there is no way to run profitable business, they dream Netflix can charge a dollar and show 10 new local blockbuster movies every month.
It’s weird to call it a cable network as it’s actually all satellite, which is how they historically got such a huge foothold due to being accessible in rural areas.
Although I imagine it’s akin to US cable companies in terms of business model.
Also, the owning company’s strategy at exclusivity (read: paying for a monopoly license) for content has how they’ve maintained their moat over the years.
I’ve done a tiny bit of contracting work for them a while back and they essentially had a money printing license. Leading to interesting organisational dysfunctions.
> You are right. I just used the term colloquially. Or perhaps working for a cable company in US I imagined satellite TV doesn't even exist :-)
Here in Australia, cable TV no longer exists - the cable TV network was shut down last year - now the only paid TV options are streaming or satellite.
The physical cables still exist, but they are only used for Internet now. They were being upgraded to support higher bandwidth Internet and in the process support for transmitting cable TV was discontinued.
I’d be surprised if the same thing doesn’t happen elsewhere sooner or later
An important aspect of being "successful" is the local viewing habits. At least in India, cricket is one of the biggest elements of TV viewership and the second biggest element is the cheaply produced poorly written run of the mill TV novellas that last 30 years and 1000+ episodes. Neither of which Netflix has or necessarily wants on it's platform. But if you ignore those two, Netflix comes out ahead on everything: Movies, international content, well produced TV shows etc.
I havr to disagree on the "poorly written telenovellas" bit.
Indian telenovellas (also dubbed Turkish telenovellas for some reason) are big business in South Africa in part because we have a pretty large "indian" population and the stories are culturally relatable to Africans unsurprisingly: evil Mother-in-law and sister-in-law battle with resilient wife, clever wife managing a falling household, struggles with pregnancy, etc...theres a market there that locally priduced content cannot fill due to the local industry being thoroughly underfunded.
The quotes are because can they really be called Indian if they have been there for 4+ generations or are they just South Africans. The whites there are not Dutch. The Central Africans that came a few generations ago are not Congolese etc.
It can go either way, really. No one's opinions matter here unless its the majority. When that is determined, that is what they are. Not even the people in question can declare it for themselves.
I would argue you are more your lineage than your nationality. See how we track various groups migration across the world, thousands of miles, thousands of years, with no problem.
But at the same time, I don't consider myself very aligned with my own lineage, and I describe myself as 100% "American". But, given enough time, if my bones were to be put on display a few hundred years from now, with all written record of me being lost, I would probably be referred to as something a bit different than what I declare as myself.
Sounds like a lot of Marc Cherry's tv shows (Desperate Housewives, Devious Maids, Why Women Kill). That kind of stuff is excellent tv! Too bad it's not big business in the west.
On Netflix there are x no of movies classified across certain categories, viewers choose from them and watch. Deciding on a movie and searching on Netflix will almost never work.
Netflix is definitely trying its hardest to get into the Indian market and I do think they are gaining some ground recently. They have picked up a lot of new telugu movies and has basically become essential if you want to stream new movies. They also have mobile only plans at 199Rs but not sure how many such subscriptions they sell but for me at least the 649Rs plan is not too bad even if my parents watch at most 1-2 movies a month on Netflix.
If they are able to get even 2 million telugu households over to subscribe the next few years, that would be a revenue of about $150 million which I think is probably much less than the amount of money they spend on telugu content.
> If they are able to get even 2 million telugu households over to subscribe the next few years,
They may as well reach to this number. But I fail to see what can Netflix do better here than local platforms with more content and better cost structure.
No way a majority of households in AP/TL spends 649 every month for Netflix unless competition hikes their prices. Most apps are about Rs. 1000-1500 a year.
> I see same thing in India where *analysts and experts on twitter opine how Netflix has totally failed in India due to lack of local content and poor execution.
That’s really true whether you believe it or not. However, it appears that Netflix seems to have understood this point. They are adding crazy amount of local content recently. Almost every notable local movie that has been released in the last year is available on Netflix now. Suddenly Amazon Prime has disappeared from the scene. That’s not the case some two years ago.
> for 90% of population Netflix is too expensive
There’s still nearly 140 million potential customers according to your calculation. You seem to underestimate the vastness of India. And more notably the people in India are crazy movie goers, from poorest of the poor to the richest of the rich.
> It's hard to justify how (comparatively) expensive Netflix is in India
I mean Zee is pooped out. Disney+Hotstar lost like 12 million customers and posting big losses. Sony, Disney shut shops in India. Seems YRF is the one making money following Hollywood lead in creating their own Spy universe. Groups like Reliance maybe the only one to survive. For them entertainment expense is incidental in other larger considerations. So others services are cheaper but it is not like they are or will likely make money.
> It seems they are trying to change this by tying up with Red Chili, Viacom18, and Balaji,
Yeah, they can add tons of Indian style TV shows with daily 10 min snippet + 20 min ads specially with ad supported version now available in more and more places. I think it can workout well from cost per content hours perspective.
But movie economics is impossible specially for big budget movies with top stars. Compare to US, Indian movies spend ~5 times more money on actors out of total movie budget. Something gotta change with movie budgets, viewers preferences, actor payments etc.
> For them entertainment expense is incidental in other larger considerations. So others services are cheaper but it is not like they are or will likely make money
Yep. But the other difference too is the fact that regional media has become much more popular as Tier 2/3/4 metros become better off.
This is a major differentiator as local language players (who tend to work with Jio or Amazon, or make their own platforms like Hoichoi for Bangla or Aha for Telugu) will bundle and price at a lower rate.
Basically, regional production companies undercut platforms by building their own niche platforms to act as a bundle with a competitively priced Jio membership.
Companies like Netflix and Disney Star simply can't compete with that as they never had relationships with regional producers compared to Amazon or Reliance.
> movie economics is impossible specially for big budget movies with top stars
Agreed, but the companies above also create OTT shows as well now, but have drastically fallen behind due to lack of regionalization.
Netflix+Hotstar just can't compete when a Jio, Amazon Prime, and regional OTT (Aha, Hoichoi, Koode) bundle comes out to around the same price as a Netflix India membership and gives much more content, prime delivery, and 5G+Fiber Internet
It's not that Indians are cheap, it's moreso the fact that price expectations are lower as conglomerates are using OTT/Entertainment as a loss leader to expand much higher margin industries like Telecom or ECommerce
> Netflix+Hotstar just can't compete when a Jio, Amazon Prime, and regional OTT (Aha, Hoichoi, Koode) bundle comes out to around the same price as a Netflix India membership and gives much more content.
I have a feeling that in few years instead of doing what others are doing better Netflix may drastically cut down Indian division and just keep their exclusive shows/ movies with high price and low market share.
Netflix needs India (and ASEAN) as those are their only growth markets left, but they entered both markets way too late and failed to build the right partnerships.
> Netflix may drastically cut down Indian division
It's already extremely barebones.
Netflix India originals are just Netflix branding on previously produced content by the production companies I mentioned earlier.
It's the same with Netflix Anime (I think it's rebranded Tokyo MX and TV Asahi content) and Netflix KDramas (JTBC - who also has a stake in TV Asahi and Tokyo MX - and CJ Group).
The local supplier had the premium paid market 100% cornered via sat TV at ridiculous prices. Then people discovered netflix and local supplier started bleeding customers. Then they took forever to launch a competing product. Even with heavy cross promotion they barely managed to salvage the situation leading to current 39% / 33.5% split.
If anyone dethroned anyone here its other way round
Indeed. Also when you consider that a chunk of Showmax subscribers cancelled their DStv subscription it's more like they snatched defeat from the jaws of victory.
That's a funny question. Do you believe the African market is like the European market, where most people can afford paid TV? To be honest, I don't know for sure, but I would imagine most people would watch "old-fashioned", free TV channels as in most countries I've been to that's what I see people watching.
2.1M subscribers, thats a tiny fraction of Africa's 1.2B people. I'd imagine demand is pretty elastic -- it'd be nice if the article had specifics on prices.
By comparison Netflix has 67M subscribers out of 330M people in US (130M households).
In South Africa: standard plan is 2x1080p streams at R89/mo, or 1.7x big Macs, or 3.5hrs minimum wage. There's a mobile plan for 39/mo. Equivalent Netflix Standard is R159/mo.
The old app wasn't great. The reason why is simple: I remember a recruiter reaching out to me at the time MultiChoice were starting off with their streaming apps and they were offering market rates for a senior developer - strange choice when building the foundation for a continent-wide business.
The new app is a high quality Netflix look-a-like, perhaps leveraging skills from the Comcast deal.
TFA mentions that Netflix has 1.8 million subscribers, so 2.1 million already sounds like a lot.
> Showmax — which was spun out of Africa’s largest entertainment company, MultiChoice, in 2015 — had 2.1 million subscribers on the continent at the end of November 2023, as compared to 1.8 million for Netflix, according to market research firm Omdia.
And there are only 500 million internet users in africa.
I wonder what metric applies, people or households. If most people watch streaming on their devices, it would be people. If they want on the family tv, if that's a thing, then households.
It's worth pointing out that ShowMax is (was?) Included as a bonus extra for DSTv, which is our local satellite tv provider in SA. DSTv is basically the only way you can get sports in SA (unless you only watch local soccer, then terrestrial broadcast is fine), so many people have it despite the ridiculous cost.
They also do quite a few local promotions with telcos and others to bundle a number of months free with some purchase, or the data costs are zero rated on mobile networks, etc.
These might be inflating the numbers a little.
Since we dont have the other streaming providvers here, specifically HBO, we need to rely on ShowMax to provide those coveted shows for us.
My ideal future would be tech companies all over the world providing better service by actually being in the country they're serving, knowing it's culture, sensibilities and tastes. The monoliths we have now don't serve customers well anywhere, but especially in markets they don't perceive as valuable enough.
I'd like to try the service and try the local content. Does anyone have recommendations for what is particularly good and what is particulary influential? I've seen some West African and Nigerian film, but very little.
Also, when they say localized content, does Showmax localize it to each country (or sometimes region, e.g., Fracophone West Africa?). 'Content localized to Africa' is as meaningful as 'content localized to the Americas', from Canada to Argentina.
Localization is fairly important for most markets and until recently Netflix has been dropping the ball on that outside of NA and Europe.
It's starting to change (eg. Netflix KDrama growth, revamping Netflix India, acquiring Arabic and Nollywood content, etc) but it will take time and the content pushed tends to still be western Netflix content.
Australia has Binge, which I don't think is available elsewhere (maybe NZ?). It seems like Australia is a small enough market that HBO, Paramount, NBC, Universal, etc – all the not-quite-Netflix sized streaming services – have chosen to just licence instead of try to launch (examples, some may have launched). This means that Binge has a really quite wide range of high quality content and in many ways feels like Netflix from the glory days.
WB Discovery has been pretty clear it intends on launching Max in Australia as early as 2025, not coincidentally when Foxtel/Binge's HBO rights are up for renewal.
Also try telling that to poor Stan, now in 5th place having lost much of its licensed content to Amazon, Disney+ and Paramount+ entering the market.
Although you’d think the application/platform itself would be a totally solved technical problem and there’d be complete COTS systems they can implement, and then you experience using the binge app on your Apple TV, phone or via browser and it’s a dumpster fire
Arguably most of the tech is off the shelf. They won't be using their own server hardware, networking gear, peering agreements, or content delivery network, and will also likely be buying the video processing, database, data warehousing, workflows and pipelines, etc. Then they'll be outsourcing payment processing, potentially identity, customer support tooling too.
What's left? Apps, which are branding-heavy, and where companies want to own the UX and a backend which amounts to a CRUD app and is cheap to build.
Yes the apps from these places suck, but they're the tip of the iceberg, built cheaply because the companies aren't tech companies and are buying COTS. Rarely do end user experiences get white-labelled in these sorts of cases.
> In 2020, Showmax acquired exclusive licensing rights to stream HBO’s content in Africa, which has become one of the biggest advantages for the company. “Although we now watch a few local shows on Showmax, my favorite shows were Billions and Curb Your Enthusiasm,” Johannesburg-based designer Mpumelelo Cindi told Rest of World.
Billions is not an HBO show. It's from Showtime (owned by Paramount).
>isn't even popular enough to refer to it by name,
The page title is "How Showmax, an African streaming service, dethroned Netflix", and the name of the service is also the very first word of the subtitle on the page. It is also referred to by name several other times throughout the article.
>it has not dethroned Netflix
If you go by subscriber count, which is a bit more robust than your criteria, it has.
No, the page title is "How an African streaming service dethroned Netflix." And that was also the title posted here originally.
Also, Showmax most definitely does not have more subscribers than Netflix. That is only true if you limit to a specific geographic region. But if you don't state as much in the title, you are lying by omission.
Open up the page, then mouse over the tab to read the page title. The page title is "How Showmax, an African streaming service, dethroned Netflix - Rest of World".
You can also press F12, and in the <head> section, read what is written in between <title> and </title>, which is what I quoted above.
To me takeaway it is impressive that Netflix still has more that 30% of marketshare.
I see same thing in India where *analysts and experts on twitter opine how Netflix has totally failed in India due to lack of local content and poor execution. Instead of accepting that for >90% of population Netflix is just too expensive and there is no way to run profitable business, they dream Netflix can charge a dollar and show 10 new local blockbuster movies every month.