Johannesburg - MTN Group’s former video-on-demand
provider Discover Digital is starting a new South African online TV
service with lender Investec, just a day after its partnership with Africa’s
biggest wireless operator was cancelled.
The closely held company will provide a mix of on-demand
subscription content and pay-per-view entertainment as well as sports coverage
and news services including Bloomberg TV, Managing Director Stephen Watson said
in an emailed response to questions. The product, called Digital Entertainment
on Demand, effectively takes the place in the market of VU, which was scrapped
by Johannesburg-based MTN on Wednesday.
Discover Digital “has been operating in the
video-on-demand space for over three years,” Watson said. “There are options
for Investec Bank to become an equity partner in the business.”
The new service joins a wave of online TV providers
seeking to grab subscribers in Africa as broadband becomes faster and
affordable enough to fuel demand for the service. That poses a threat to
Naspers Ltd.’s DSTV, which has long dominated the continent’s pay-TV market.
The Cape Town-based company started Showmax, its response to the competition,
two years ago. US giant Netflix Inc. expanded into Africa in January 2016.
Sun partnership
Discover Digital has signed a partnership agreement with
South African leisure company Sun International that will enable guests at its
hotels to access the content for free, Watson told reporters at a press
conference on Thursday. The TV provider has secured licensing deals with six
Hollywood studios, including Sony Corp. and Walt Disney Company, he said.
This type of TV technology can be expanded quickly,
without exorbitant infrastructure costs, according to Watson. The next
countries earmarked for expansion are Zimbabwe and Zambia.
“While our immediate focus is sub-Saharan Africa, we have
had interest in our services from the Middle East, Eastern Europe and South
America,” he said.
Read also: Netflix poised to shake up SA
MTN emailed customers to say VU would be shut down,
without giving a reason. The company will provide subscribers with three months
of access to Showmax as compensation, Techcentral website reported, citing MTN
South Africa Chief Digital Officer Maxwell Nonge. The move came less than two
months after new CEO Rob Shuter joined from Vodafone Group.
Other new entries to the African market include Econet
Wireless Global, the media company owned by Zimbabwe businessman Strive
Masiyiwa, and Ericsson’s Nuvu, which has partnered with Bharti Airtel in
Nigeria. Iflix, a video streaming service with customers mostly in southeast
Asia that’s backed by telecommunications giant Liberty Global., plans to start
streaming TV shows in Africa this month.
DEOD’s sports packages will be charged at R99 ($7.31) a
month, news channels for R49 a month and an on-demand video service at R79 a
month, Watson said.