DStv cuts subscription charges in response to rising rivalry for clients

The company’s move is a pointer to its intent to ring-fence its client base in the face of increasing competition from US-based streaming service Netflix as well as Internet providers such as Wananchi Group, which owns Zuku.

“MultiChoice’s focus is committed to being a consumer-centric business that is sensitive to our customers’ needs,” said Stephen Isaboke, MultiChoice East Africa’s regional director.

Subscribers on the Premium (most expensive) tariff plan now pay Sh8,180 down from Sh9,400 per month, reflecting a 13 per cent drop, while Compact Plus users will now part with Sh5,425 every month down from Sh6,400.

Customers subscribed to the Compact plan will enjoy a Sh200 drop in monthly charges to Sh3,550 while those on the Family bouquet will pay Sh1,900, representing a decrease of Sh250.

Subscription fees for the cheapest package, Access, have remained unchanged at Sh1,050 per month. MultiChoice has also added between three and 11 channels to its range of bouquets.

“We have taken into account the current economic environment and financial pressures that our customers are facing and are responding to these factors,” said Mr Isaboke.

DStv’s price cuts point to the changing pay TV landscape, where Kenyans are increasingly subscribing to Internet services and streaming content online.

A year ago, Zuku launched a new package that allows users to subscribe to Internet and telephone services, Internet and pay TV or a combination of the three.

READ: Kenya pay-TV firms set to feel the heat of Netflix launch

This unbundling could work in Zuku’s favour and its rival Jamii Telecom’s whose Jamii Faiba dominates the Internet’s home market segment with over 8,000 customers.

Using devices such as Android-based TV boxes (which connect to the Internet), customers have been illegally streaming content such as the English Premier League which has helped MultiChoice Kenya cement its local dominance.

The pay-TV provider has also had to contend with increased competition from Netflix, an on-demand service that also transmits shows via Internet-enabled devices.

The service, which was launched locally in January, charges customers a monthly subscription fee of between $7.99 (Sh810) and $11.99 (Sh1,216), a fraction of what DStv charges.

While MultiChoice Kenya maintains that over-the-top service is complimentary to its content and not a competition, its parent company Naspers revealed that it expects to lose about 288,000 clients across Africa this year.

Naspers’ chief executive Bob Van Dijk revealed this customer departure during an interview with South Africa’s Mail & Guardian in June.

“We have also lost a lot of subscribers in the last year in sub-Saharan Africa, people have just not been able to afford it. We bill in local currencies, but our costs are in dollars. It is quite painful when the currencies are running in the wrong direction,” he said.