Music and Entertainment

Tanzania’s Mkito Music Plans To Branch Out Into More Countries

Tanzania’s online music platform, Mkito was launched in 2014 and offered a pay-for premium service and a restricted free service that would be covered by advertising. Fast forward to current times, Mkito has grown and evolved as the markets change.

The founder of Mkito, Sune Mushendwa says that the platform has grown from being purely about downloads to including streaming as well as focusing on feature phones.
The CEO of Balancing Act, a research company, focused on internet, telecoms and broadcast in Africa, Russel Southwood, has been analysing Mkito’s position in the market and he spoke to AIM Group’s Hafiz Juma. They discussed why numbers alone will not be enough to keep Mkito going and how its business model is being adjusted to keep up with the times.

Mkito recently rolled out an Android app that is focused on streaming, but it’s put the release of its iOS app on hold due to changes in Apple requirements, forcing all apps to use Apple pay for in-app purchases which is not practical for Mkito.

The number of Mkito subscribers has grown incredibly since February 2015 to 1 million, and of those, there are 300,000 monthly actives, but only 2% of the monthly actives are paid users, and this is not enough to create a positive cash flow.
Southwood says very few customers choose the paid version of the service and those who subscribe to the streaming face challenges with payment.  He says that Mkito could facilitate recurring payment from the wallet, but users are not topping up significant amounts into their wallets. They only put in the amount they need for a single transaction. He adds that companies like Spotify and Apple Music will probably face similar challenges in these markets.

AIM is one of Mkito’s investors, and it is looking to convert Mkito to being a music brand with two elements: the existing music platform and other items that are not purely about music.
The new elements would include things like content marketing, event ticketing and exclusive agreements with musicians to conduct co-branded events for new artists.
Other online functions, as well as printing services, would also be added to the brand.

AIM wants to grow Mkito’s footprint by involving countries like Uganda, DRC, Kenya and Sudan as this would widen the scale and increase profitability.

AIM’s Juma identified West Africa’s Boomplay and Kenya’s Songa as two platforms that are Mkito’s strongest competitors, but he believes that if Mkito makes the necessary changes, the platform will become a force to be reckoned with.

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