BMA's View | Does Multichoice Need To Revisit Its Pricing Strategy To Stay Competitive?
Analysts working within Africa's broadcast media industry are beginning to question the wisdom behind Multichoice DStv's current pricing strategy. Industry watchers are now asking whether the seemingly incessant price increases from Multichoice is now starting to hurt the company, both operationally and strategically.
Independent industry analyst, Chris Gilmour, probably voiced what many of his colleagues have been wondering, and some muttering, when he commented during an interview programme on Business Day TV that "Multichoice doesn't get it, and suggested that the Pay-TV price hikes on its DStv and GOtv platforms are becoming overly expensive for consumers, who now have plenty of substitute options.
Multichoice had only last week announced its DStv price increase. The company COO, Simon Camerer, justified this as "below inflation" and said, "if judged on a weighted average basis is only a 2.4% increase". However, analysts are dubious with this reasoning, more so when as it's been predicted, Multichoice could well be lining-up another round of price hikes in April, which is likely to be inflation bursting and could affect M-Net subscribers the most.
Yet, the questions remain, is the ongoing pricing hike strategy the correct course for the Africa entertainment media behemoth? Or does it need to do a deep-rooted operational and strategic re-assessment? How far can Multichoice push its subscribers pocket even when they want to remain loyal?