MultiChoice explains annual rise in subscription fees

MultiChoice Africa, the owner of pay-TV brand DStv, has warned its subscribers of annual fee increments in what it blames on higher operating costs.

This means that DStv subscribers should expect their bills to rise steadily going forward, inflating their overall entertainment budgets.

The price alert comes after the company implemented higher fees for its various bouquets starting this month. The increases had been reported by BDAfrica.com at the beginning of March.

“Unfortunately, it is necessary to implement a price increase on an annual basis due to rising costs to the business,” the company said in a statement.

The announcement by DStv, which has the biggest market share in Kenya, comes at a time when the pay TV market has attracted new players including StarTimes which are luring customers with lower-priced bouquets.

DStv’s new fees will see customers pay between Sh930 and Sh8,200 per month depending on the number of channels and premium content in their bouquets. This represents a price increase of between Sh50 and Sh800.

Those subscribing to the Premium bouquet will now pay Sh8,200 while those on Compact Plus will pay Sh5,500.

The Personal Video Recorder (PVR) access fee has also increased to Sh1,020 a month, up from the previous Sh880.

READ: DStv customers to pay up to Sh110,000 subscription fee

MultiChoice attributes the rise in the fees on several cost items including satellite, content and devaluation of currencies against the dollar. The company buys most of its content based on the dollar and charges subscribers in local monies, exposing it to currency risks.

“In determining a price increase, MultiChoice takes into account many factors including the impact on the subscriber, current inflation and efficiencies effected within the company that may offset the necessity for a price increase,” the firm said in a statement.

MultiChoice added that it also needs to set rates which allow it to maintain reliable and high quality content while also earning a return on capital.

The digital migration wave has attracted new entrants in the pay- TV market, signalling increased competition for established firms like MultiChoice and Wananchi Group which runs the Zuku brand.

Standard Group, for instance, has announced plans to enter the pay TV business through partnerships. StarTimes is seeking to grow its market share by offering packages at lower prices including one dubbed Nyota which costs Sh150 per month.