Satellite television operator MultiChoice first invested in Nigeria during the early nineties and sees the country as a long-term project. John Young asked MultiChoice Nigeria managing director, Joseph Hundah about the company's investment strategy.
What were the factors behind the decision to invest in Nigeria?
In 1992 MultiChoice first began its expansion into the rest of Africa – Nigeria was a natural market for MultiChoice to set up operations due to its high population density and vibrant economy.
Was the decision to invest in Nigeria vindicated? What percentage of turnover derives from Nigeria?
MultiChoice takes a long term view of investments in all its markets as providing satellite television services is a long term and very costly exercise. Nigeria has one of the larger subscriber bases outside of South Africa, but it has taken many years to recover the investment made in Nigeria. Nigeria's contribution to the group's turnover is less than 10%.
What have been some of the highpoints along the way?
There have been many highpoints along the way in our involvement in the Nigerian market.
Investment in infrastructure:
Contribution to the development of the media industry:
Contribution to the development of SMME:
Were there particular challenges that were different to what MultiChoice expected when you first came into the market?
There were many challenges which existed in setting up operations in the Nigerian market. However, the company has local shareholders who enabled it to navigate through these challenges. When we decided to invest in the country we were aware of the challenges common amongst are pressure on availability of infrastructure such as electricity, roads, water and sanitation.
How do you deal with power supply issues: in your offices; in your backup/service division; in your transmission stations?
In an effort to provide uninterrupted and quality customer service, we have 24-hour back-up generators in all our offices across Nigeria to ensure that we have continuous supply of electricity.
How have Nigerians responded to the various bouquets?
There has been a good response from Nigerians to all our bouquet offerings – DStv Premium, DStv Compact and DStv Family. The growth has occurred across all our bouquets.
Have you adapted and/or adopted special new bouquets for the Nigerian market?
We have focussed on providing three levels of entry in terms of the bouquet offering. Our main focus has been on customising channels and programming particularly for that market – as can be seen in the launch of Africa Magic, and M-Net West Africa which is scheduled according to that time zone. We invest a lot of time and resources in understanding the markets we operate in through research and development; any programming, content or channel decisions are based on this research.
What is your overall reading of the Nigerian economy? Is it on the rise? Which sectors are driving growth? Do you see good things for your industry in the future?
The Nigerian economy is robust and we believe will continue to see positive growth in the future, the oil, gas, manufacturing and service sectors have a prominent role to play going forward. The media industry is at the brink of major developments, e.g. digital migration, which will move the industry in line with international developments.
Any other aspect that you would like to share with readers about the experience of investing in Nigeria?
Nigeria is a very exiting place to operate in as the market is very dynamic. No player that wants to be a continental player can afford not to have a presence in Nigeria. Nigeria, like any other market globally, has its own peculiar challenges and the country has good long term potential.
