Multichoice is exiting Malawi following a high court ruling preventing the company from invoking further price increases for DStv service in the country.
Pan-African broadcaster Multichoice is pulling its satellite television service provider, DStv, out of Malawi. This follows a decision by Malawian regulators to reject DStv’s latest price hikes. At the end of July, the Malawi Communications Regulatory Authority (MACRA) obtained an interim injunction from the country’s High Court. The injunction prohibited Multichoice Malawi from changing or modifying DSTV tariffs. Yesterday, August 8, the high court further ordered Multichoice to comply with the order, leading the broadcaster to terminate its DStv offering in Malawi.
MACRA’s injunction was premised on the fact that because Multichoice did not directly offer the DStv service to the public, it could not set or adjust tariffs for the service in the country. Multichoice believes that the court order makes business impossible. And the consequence of non-compliance, which included imprisonment for the company’s staff, led to the decision to exit the market.
“Given the impact on Multichoice Malawi and an increasingly adverse regulatory environment, [Multichoice] is therefore left with no option but to terminate DStv services indefinitely,” the company said.
Setting precedence for the rest of Africa?
In Multichoice’s annual results for the year ended March 31, 2023, DStv’s “Rest of Africa” market segment, which includes its plays in the continent apart from South Africa, returned to profitability for the first time since the company was publicly listed in 2019.
“We continued to scale our overall subscriber base and benefited from a strong performance in the Rest of Africa, that delivered a trading profit for the first time since our listing in 2019,” said CEO Calvo Mawela.
With DStv’s growth in South Africa slowing down over the last few years, Multichoice is looking to the RoA segment to compensate for that slump. Data firm Omdia forecasts modest pay TV subscriber growth of just 5.1% between 2022 and 2027 for MultiChoice in South Africa, compounded by the energy crisis currently gripping the country. By contrast, the firm expects the RoA segment to contribute a growing proportion of MultiChoice’s total pay TV subscriptions, with this share of subscribers forecast to rise from 53.6% in 2022 to 56.4% by 2027.
