MultiChoice+ Adopts Cost-Cutting Measures Amid Declining Revenue and Subscribers MultiChoice+, the leading pay-TV provider in Africa, is implementing a range of cost-cutting measures in response to declining revenue and subscriber numbers. Revenue Challenges MultiChoice+ has faced revenue declines in recent years due to competition from streaming services, piracy, and the global economic downturn. The company’s financial performance has also been impacted by currency fluctuations in its core markets. Subscriber Loss In addition to revenue challenges, MultiChoice+ has also experienced a loss of subscribers. Streaming services are offering more affordable and convenient content, leading many consumers to cancel their pay-TV subscriptions. Cost-Cutting Measures To address these challenges, MultiChoice+ has announced a series of cost-cutting measures, including: * Layoffs: The company has laid off an undisclosed number of employees across its operations. * Content Reduction: MultiChoice+ is reducing its content spending and renegotiating contracts with content providers. * Closure of Channels: The company is closing down underperforming channels and reducing the number of channels it offers. * Operational Efficiency: MultiChoice+ is implementing measures to improve operational efficiency and reduce overheads. * Investment in Streaming: The company is shifting its focus towards streaming services and investing in its own streaming platform, DStv+. Impact on Consumers The cost-cutting measures are likely to have a mixed impact on consumers. While subscription fees may increase due to reduced content spending, consumers may also benefit from the introduction of more affordable streaming options. Future Prospects The future prospects for MultiChoice+ depend on its ability to adapt to the changing media landscape. The company is facing significant challenges, but it has a strong brand and a wide reach. If MultiChoice+ can successfully implement its cost-cutting measures and pivot towards streaming, it has the potential to remain a major player in the entertainment industry.

• Following MultiChoice’s decline in revenue and subscribers for the fiscal year ending March 2024, the South African media company’s CEO Calvo Mawela stated that the company “can still achieve a lot of cost savings without cuts”.

• According to a My broadbandAccording to the report, the company intends to reverse the decline and has set a savings target of R2 billion by 2025 to improve its financial position.+

• Additionally, these savings will be applied across the board, focusing on big-ticket items such as satellite leasing.++Additionally, contracts for this measure will soon be available for renegotiation.+

The company is also developing digital products that can be added to its existing pay TV base to increase revenue.++“Our strategy to increase this additional revenue is no longer just a vision, it is gaining real traction,” Mawela said.

MultiChoice Group has released its operating performance for the fiscal year ending March 2024 (FY24), showing a 9% decline in total active subscribers.++Subscribers fell 13% in Nigeria, Angola, Kenya and Zambia, while South Africa saw only a 5% decline due to a “strong focus on retention initiatives.”+

The decline was attributed to the depreciation of local currencies in these markets, the “Rest of Africa”, which reduced the Group’s dollar revenue by 32%.

The Group’s organic revenue rose 3%, but reported revenue fell 5% to ZAR 56.0 billion (£3.04 billion).++Similarly, subscription revenue increased 2% organically but decreased 7%.

Mawela said his streaming service, Showmax, is on track to generate $1 billion in revenue in five years.++Furthermore, in its recent operating report, Showmax achieved organic revenue growth of 22% to ZAR 1 billion (£54.475 million), despite incurring some trading losses.

Canal+, which has been on a spree of acquiring shares in MultiChoice and is in talks to buy the company for up to R35 billion, has also recently stated that it has no plans to rebrand MultiChoice after the acquisition, emphasizing its high Brand value.

Peter Takaendesa of Mergence Investment Managers reportedly believes that MultiChoice’s new revenue streams are insufficient to offset the challenges facing its traditional pay-TV business, which is experiencing structural and cyclical pressures.+

However, he said Canal ’s offer to acquire MultiChoice shares for R125 per share has become the main driver of the share price, which is a positive development for shareholders.+

According to the report, pay-TV operations in South Africa have faced significant challenges, exacerbated by initial losses incurred to finance Showmax.

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MultiChoice, the parent company of DStv and Showmax, has announced plans to implement cost-cutting measures in response to declining revenue and subscriber numbers. The company’s latest financial results showed a 1% decline in revenue for the year ended March 2023, attributed to factors such as currency devaluation, reduced consumer spending, and increased competition in the pay-TV market. MultiChoice has also been experiencing a decline in subscriber numbers, with its DStv platform losing 1.4 million subscribers in the past year. The company has identified several reasons for this decline, including the rise of streaming services, cord-cutting, and economic challenges. To address these challenges, MultiChoice plans to implement a range of cost-cutting measures, including: * Reducing operating expenses * Restructuring its workforce * Re-evaluating its content strategy * Exploring new revenue streams The company has stated that these measures are necessary to ensure its long-term sustainability and to continue providing high-quality content to its customers. However, it is unclear how these cost-cutting measures will impact MultiChoice’s programming lineup or its employees. MultiChoice’s announcement has raised concerns among some industry analysts and investors. They worry that the cost-cutting measures could lead to a decline in the quality of MultiChoice’s services, which could further alienate subscribers and lead to further revenue declines. However, MultiChoice has stated that it is committed to maintaining the quality of its services while implementing the necessary cost-cutting measures. The company has also indicated that it is exploring new revenue streams, such as streaming services and mobile content, to offset the decline in revenue from traditional pay-TV subscriptions. It remains to be seen whether MultiChoice’s cost-cutting measures will be successful in stabilizing its business. The company faces significant challenges in the pay-TV market, and it will need to find innovative ways to attract and retain subscribers while managing its costs.