Mobile Ops Key to African OTT

According to Digital TV Research, sub-Saharan Africa OTT TV and video will still be a very immature sector by 2022, with movie and TV ...

Netflix forecast to hit 201 million subs by 2023
Netflix forecast to hit 201 million subs by 2023

According to Digital TV Research, sub-Saharan Africa OTT TV and video will still be a very immature sector by 2022, with movie and TV episode revenues expected to reach $640 million for 35 countries. However, that total is up by a multiple of 12 on 2016's $52 million. The research house says South Africa will account for 40% of the region's revenues by 2022, with Nigeria bringing in a further 21%.

SVOD is the main revenue driver for OTT TV and video. SVOD revenues are expected to reach $475 million by 2022 (or 74% of the OTT total), up by 22 times on the 2016 total (40% of OTT revenues).

Simon Murray, principal analyst at Digital TV Research, said: "It is very important to stress the power that mobile operators have over the future of sub-Saharan African OTT TV and video. Although the total will triple from 2016, we only expect 13 million fixed broadband households by 2022. Fixed broadband is clearly not big enough to sustain a viable OTT sector. However, there will be 486 million smartphone users by 2022."

"The mobile operators know that they are in a powerful position. Not only can they give OTT players access to their extensive subscriber pools, but they can also conduct the billing (thus foregoing the need for SVOD platforms to insist on credit card payments).

"Most importantly, many mobile operators currently charge high data prices for OTT access - which can add considerable costs to subscribers. However, a distribution deal with a mobile operator can substantially cut these costs."

Digital TV Research forecasts 10.12 million SVOD subs by 2022, up from 525,000 at end-2016. South Africa (2.70 million by 2022) is expected to remain the leader, but Nigeria (2.64 million) is expected to be close behind.

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