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By Olalekan Bilesanmi
POINT OF VIEW IN BRIEF: No immunity on production costs
Debates over subscription for pay-TV services in the country are still pbadionate . The widely held belief is that pay-TV services are too expensive, especially when operators are raising prices for their services. MultiChoice, owner of the DStv and GOtv platforms, is the largest pay-TV operator in the country.
Because of the quality of its offers, it has the largest number of subscribers.
quality of its programming, consumers tend to think that its services should be less expensive. For any pay television operator, the content of the program plays a central role. By choosing between distributors, consumers largely base their choice on the programming available for each of them. In particular, very attractive "high-end" programming, especially live coverage of popular sports events and recent Hollywood films, determines consumer choice.
Convincing content is not cheap though. Rebate contracts of such amounts attract astronomical sums, especially when they are about to be revised. Content owners, knowing the value of what they 've got, ask for more money for rights anytime they want to review the contracts. That leaves the pay-TV companies at their mercy. To stay in business, pay TV operators must periodically review their prices. This, of course, never sits well with their customers. This is the main reason why MultiChoice is under fire. Subscribers also tend to ignore the fact that prices are influenced by operational costs, government regulations and the economy.
For three years, prices of goods and services continued to rise astronomically in the country. The weakness of the national currency against the dollar, the international currency of business, has continued to make things difficult for companies that import. Television content, including popular Nollywood films, is paid in dollars, which exposes pay TVs to exchange rate volatility. The same fate, of course, is suffered by other sectors and even by those who supply locally, the prices of other products affecting theirs. Prices of toothpaste, detergents, alcoholic beverages, fish, meat and other products have been adjusted several times over the past two years.
Pay television companies are not spared by other sectors. prices when the need actually feels. Three years ago, StarTimes increased its prices twice in one year, following the acquisition of broadcast rights on important sports content. Without doing so, he would probably have folded, throwing a lot into the job market. In 2015, MultiChoice's decision to raise prices created a huge storm, partly because of an unsupported and widely publicized claim that its Nigerian subscribers would pay more than those in other countries where it operates . Can pay-TV companies ignore economic realities, including those of the ecosystem in which they operate? This is not a possibility
Market conditions would always be the main determinants of prices. They explain in part why Nigerians pay $ 40.78 for DStv Premium, $ 27.46 for Compact Plus and $ 17.48 for Compact, while subscribers in Zambia pay $ 80.83 for Premium, $ 46.04 for Compact Plus and $ 30.69 for Compact. Ghanaian subscribers pay $ 75.09 for Premium, $ 44.37 for Compact Plus and $ 28 44 for Compact. Prices in Zimbabwe are $ 62, $ 40 and $ 25, respectively.
If any of these markets is affected by the volatility of exchange rates, it is very likely that it is impossible for any company to maintain the same prices.
