MultiChoice’s $3bn merger with Canal+ aims to strengthen its stance against US streaming giants in Africa, expanding reach in key markets.
[dropcap]M[/dropcap]ultiChoice CEO Calvo Mawela has announced that a prospective $3 billion merger with French media company Canal+, owned by Vivendi SE, could significantly strengthen the African TV giant’s ability to compete with major US streaming services like Netflix.
Mawela revealed on Thursday, in an interview with Bloomberg TV, that the merger awaits regulatory approval and, if successful, will expand MultiChoice’s reach across both English- and French-speaking regions of Africa.
Also read: MultiChoice faces subscriber decline amid changing market dynamics
The deal is set to bolster MultiChoice’s position in the increasingly competitive streaming industry, leveraging Canal+’s established footprint in French-speaking Africa and MultiChoice’s dominance in English-speaking areas.
Mawela emphasised that this merger would provide the combined entity with essential scale, enabling better content rate negotiations and higher revenue potential.
“A combination gives us a better chance to compete against the global giants,” Mawela stated. “This enables us to negotiate better rates for content and generate more revenue, especially with one party operating in French-speaking Africa and the other in English-speaking parts of Africa.”
Under South African competition law, this “large merger” will require the approval of the Competition Tribunal. MultiChoice accepted Vivendi’s merger offer in June, setting the stage for what could be a transformative move in Africa’s media landscape.
In recent years, streaming competition in Africa has intensified. Research firm Omdia estimated that, as of November 2023, Netflix had around 1.8 million subscribers across Africa, while MultiChoice’s Showmax service had slightly more with 2.1 million.
Digital TV Research projects that by 2029, Netflix could lead the market with approximately 6.9 million subscribers, while Showmax is expected to grow to around 3.7 million.
In response to this competitive landscape, MultiChoice has been enhancing Showmax by partnering with Comcast’s NBCUniversal and Sky, adding features like live Premier League coverage to appeal to a wider audience.
However, challenges persist. MultiChoice recently reported a decline in Nigerian subscribers, with a loss of 243,000 users across its DSTV and GOTV services for the six months ending 30th September 2024
. This drop has been attributed to high inflation in Nigeria, which has driven up costs of essentials like food, electricity, and fuel, making household budgets tighter.
Despite these setbacks, MultiChoice is optimistic about the proposed merger with Canal+, which it believes will drive growth and solidify its standing as a leader in Africa’s rapidly expanding media market.
