Over the last few months, pay TV channel DStv has come under fire for a range of reasons. High subscription rates, questionable customer support services and perceived unfair exploitation of its monopoly are some of the criticisms that DStv has faced, with a majority suggesting that the pay TV channel was taking advantage of its lack of adequate competition in the country.
Typically, there have been mass action calls for boycotts, government intervention and regulation, and also government support and funding of an alternative option for Nigerians.
Having been operational for over ten years in Nigeria, it is perhaps understandable that many think DStv is taking advantage of the market where it enjoys large-scale dominance. But the big question remains: is DStv ripping off Nigerians?
Why is DStv so expensive?
One of the biggest criticisms of DStv has been the pricing of its packages. With the prices also subject to change depending on currency valuations, DStv is often accused of arbitrarily increasing its prices without consideration of its users.
The underlying logic behind DStv’s rather high pricing package though is hinged on the fact that it offers premium content — which does not come cheap. In a big football market like Nigeria, broadcast of big European leagues will draw subscriptions; but the rights to these football leagues do not come cheap, neither does entertainment content.
Sharing this sentiment, revered Nollywood filmmaker and CEO of Pinpoint Media, Chris Ihidero, argues that expensive premium content is not exclusive to only DStv.
“Premium content is expensive everywhere on Earth,” he says. “If you want to consume premium content, you must be willing to pay for it.”
Simply put, being a business driven to make a profit, DStv rates are high because its operating costs are also high.
Often, the criticism of DStv almost suggests customers want to watch the best content and also determine the price they pay. In truth, DStv does have a range of bouquets available.
“DSTV has different bouquets suitable for different levels of income. It’s more profitable for people to locate their level than to seek to enjoy champagne content on ‘ogogoro’ income,” Ihidero adds.
Are there alternatives to DStv?
Every conversation on DStv tends to involve the word “monopoly”. This is because, overtime, no company has offered a sustainable alternative to DStv. The now-defunct HiTV was thought to be the alternative Nigerians had sought for, but, after three years of operation, it closed up shop, allowing DStv once again dominate the market.
Chinese-backed StarTimes appears to be enjoying steady commercial growth and could be eyeing a long-term goal of competing with DStv, but for now, it remains focused on the low-end market.
Amid the bashing of DStv, there is often a call for alternatives to emerge. A common mistake is repeated: assuming that these alternatives will be automatically cheaper than DStv while offering the same level of content. Theoretically, the presence of competition could force DStv to review its pricing, but, given that operating costs will be similar, the changes in prices will not be markedly different.
“The best way to force down prices is of course competition. We know what happened as regards HiTV. That is not DSTV’s fault, so why old them responsible for lack of real competition?” says Ihidero.
In the meantime…
The reality is that DStv are a major player in the Nigerian pay TV industry and will not be going away soon. Of course, in the meantime, a lot more can be done to foster a better relationship with its customers.
While some of the criticism has been undue, much of it has been deserved. At the start of the football season, there were slight changes in selected channels for football broadcast, but these changes were not properly communicated, leaving customers to cynically suggest that it was a ploy to force more subscriptions. There have also been repeated instances of disconnected transmission before the expiry of subscriptions and technical glitches which are seemingly treated dismissively.
More than anything else, DStv must address the distrust which exists between the company and its many customers. It might control market share and might comfortably enjoy dominance, but at the end of the day, DStv will be nothing without its customers. More often than not, the feeling is that the company thinks otherwise.