DStv increases monthly charges to cover rising costs
Posted Thursday, March 14 2013 at 19:55
- Subscribers on the Premium bouquet will pay $82 (Sh6,998) up from $80 (Sh6,827) starting April 1 while those on Compact Plus will pay $52 (Sh4,438) from $50 (Sh4,267).
- MultiChoice linked the increase to rising input costs and the review will affect subscribers across the continent.
MultiChoice Africa, the owner of DStv, has increased the monthly fees of its premium pay TV services to cover rising costs in a market it enjoys a near monopoly.
Subscribers on the Premium bouquet will pay $82 (Sh6,998) up from $80 (Sh6,827) starting April 1 while those on Compact Plus will pay $52 (Sh4,438) from $50 (Sh4,267), reflecting an increase of four per cent.
The prices of its low end products dubbed Family and Access —where it is facing stiff competition from Wananchi and Star Times—remained unchanged at $20 (Sh1,707) and $10 (Sh853.50) per month respectively. MultiChoice linked the increase to rising input costs and the review will affect subscribers across the continent.
“Increased costs in many of these areas of our business have made it necessary for the brand to raise the price of subscriptions,” said Danny Mucira, MultiChoice Kenya GM.
“These include satellite lease costs, channel costs, content cost, technical infrastructure and operational costs.”
The review of rates comes when DStv has tightened its grip on the Kenyan pay TV market, aided by exclusive content.
In the past three years, the entry of Wananchi with its Zuku brand and StarTimes has pushed the competition a notch higher forcing DStv to roll out bouquets that cater for low income earners. Zuku’s Premium bouquet retails at Sh3,999 after a 25 per cent cut in August last year while StarTimes charges between Sh499 and Sh2,499 for its packages.
But the pay-TV providers have been unable to shake DStv’s dominance, especially in the premium market that MultiChoice serves with exclusive content like the English Premier League (EPL).
The exclusive rights have fuelled MultiChoice’s market dominance in Africa— including in Kenya—leading to claims from the Communications Commission of Kenya (CCK) that the company is acting in an uncompetitive manner and forcing consumers to subscribe to the operator as opposed to considering rival companies.
The CCK and other industry rivals had demanded that MultiChoice share its exclusive content including the EPL. The CCK claims that similar content-sharing models have already proven successful in UK, Italy and Nigeria.
But MultiChoice claims that rights sharing will not only diminish revenue, but also reduce the value of the content with knock-on effects to the sports and film industries, while advertisers will be alienated from the sector.
The South African operator has proposed that it might re-sell some content to rival operators provided delayed airing is guaranteed, meaning MultiChoice retains first airing rights.