Africa’s “Video Streaming Wars” Remain An Exaggerated Small Scuffle
With Netflix’s recent glut of efforts in Africa, as well as the endeavours of Showmax, Amazon Prime Video, and Apple TV+, it seems everyone is rooting for video-on-demand (VoD) streaming in Africa.
As such, there appears to be a popular view that the “streaming wars” is on amongst the top video-streaming platforms that are all looking to cut it in Africa. But has the streaming wars really taken off or is the whole thing exaggerated?
Well, streaming wars, by implication, emphasizes the existence of high activity and competition between video streaming services of the likes of Netflix, Showmax, and iROKOtv in Africa.
The streaming wars ideology kicked off on the grounds of how the world’s top video streaming services like Netflix, Amazon, HBO Max, Disney+, and Apple TV+ are at loggerheads for a share of the video streaming businesses.
And so, does this same ideology also apply to the African continent? Wouldn’t a streaming war occur only when there’s already a giant cake from which each of these individual platforms is fighting for a piece? These are ideal questions to ponder on.
In a real sense, the streaming war term should only be referred to in these parts when these platforms have first hacked video-streaming in Africa, thereby providing a ground for competition, heralding the “war,” so to speak.
On the African continent, the so-called streaming wars that many like to allude to with a hint of fascination is not so much a war as it is a small backyard scuffle.
The reality of the situation is that streaming platforms have barely scratched the surface in Africa. For instance, the continent has a population of 1.3 billion, but not up to 4 million of its indwellers use video streaming platforms.
The state of video streaming in Africa
Answers to two questions are sought after here. In the video streaming game, where exactly is Africa at and how has the continent fared in reality?
According to a London-based industry forecaster known as Digital TV Research, the total number of video streaming users is 3.9 million. And so, this means that just about 0.3 percent of the African population uses at least one video streaming platform.
Digital TV Research also reports that Netflix has just 2 million subscribers in Africa and it’s way ahead of the rest. The likes of iROKOtv, Showmax, Apple TV+, Disney+, and Amazon Prime Video, and others have each managed only a tiny fraction of Netflix’s small subscriber base in Africa.
For context, in the United States, Netflix alone recorded about 73 million subscribers in 2019. For emphasis, this number is just for Netflix users alone and it would be a lot more if the users of other streaming platforms are added up. This statistic captures a video streaming penetration of at least 20 percent in the United States.
Again, Netflix had 195.15 million paid subscribers globally as of the third quarter of 2020. Out of this amount, Africa makes up less than 2 million.
Give this some thought: Africa, the second largest continent in the world, makes just roughly 1 percent of the total Netflix subscribers. This same Netflix also is the most used video streaming platform in Africa.
So iterating again, where is the “streaming wars”?
The next question would then be the “why.” Why is video streaming find it hard to find its feet in Africa?
Africa’s video streaming troubles
In simple words, video streaming is costly. It takes money to produce and deliver quality. And so it’s very likely that a subscription-based service that costs a few dollars would do better in an area with higher income levels.
It’s no secret that the income level in Africa is one that is way below the global average.
A world bank statistics in 2015 revealed that sub-Saharan Africa was home to 27 of the world’s 28 poorest countries and had more extremely poor people than in the rest of the world combined.
The high poverty rate obviously yields the low-income levels seen on the continent. And so a large bracket of Africans that aren’t exactly poor, are not earning so much either. Since video streaming isn’t a necessity for life, wouldn’t money rather be spent firstly on the necessities? And so the low video streaming numbers adds up now, doesn’t it?
Furthermore, video streaming rides on the ship of internet availability and affordability. And Africa has one of the most expensive internet prices in the world. Having stressed the low-income level in Africa, Africans are still found to pay more for the internet.
The country with the most expensive data in the world is an African country, Zimbabwe, where 1GB of data costs USD 75.00. That same quantity of data costs just USD 0.26 in India.
Also, the GSM Association (GSMA) reports that data costs a whopping 6.8 percent of monthly income in African households compared to just 0.5 percent for those living in more affluent areas.
It doesn’t even end there. It has been said that the internet is expensive, alright. But the connectivity of this “expensive” internet is also not that great. And it’s known that video streaming in an area with a poor internet connection would perform poorly.
In simple terms, internet costs in Africa are higher than anywhere else, and yet internet speed remains below global standards.
Besides the gaps in reliable connection, many areas on the continent do not have access to this internet. Although there have been improvements on this front and in the area of smartphone penetration, there is still a lot left to be desired. In any case, these factors are among the reason behind low adoption of video streaming in Africa.
In Africa, only 39.3 percent of the population have internet access, in comparison with a global average of 58.8 percent. This low internet penetration rate, by itself, already video streaming at a huge disadvantage.
The verdict
Yes, it is true that Netflix currently leads the African market, with close to 2 million subscribers. Showmax comes in second with 688,000 direct subscribers, although it existed before Netflix. On its part, iROKOtv trails Showmax.
On the basis of the factors and numbers mentioned above, pronouncing that streaming wars is in full swing in Africa would be quite a reach.
It’s undeniable that there’s a lot more that needs doing in Africa’s video streaming space, as the so-called main players are yet to even scratch the surface.
There is a lot of building, innovation, and reimagination required to make Africa’s video streaming scene pop. And maybe a few years from now, the story may be different, or not.
Featured Image Courtesy: GettyImages
