In the chase for scale in streaming, it’s the technology behind NBCUniversal’s Peacock that could be the saving grace for African SVOD service Showmax.
Pan-African pay-TV operator MultiChoice revealed on Thursday that it will be relaunching its regional streamer Showmax with Peacock technology. NBCUniversal and the U.K.’s Sky will take a 30% share in a new company that will redevelop and overhaul Showmax for African audiences.
Launched in 2015, Showmax has been feeling the intense pressure of lower-priced global streamers like Netflix, Disney+, Amazon Prime Video and Apple TV+ scooping up subscribers across the African market. (HBO Max is yet to launch and Paramount is still working on a Paramount+ rollout for the continent.)
With Peacock not yet available in Africa, NBCUniversal and MultiChoice are signalling what might be the start of a new wave of consolidation in Africa for streamer survival, with MultiChoice keeping 70% and NBCUniversal a 30% stake in a “new” Showmax through Earth UK Holdings Limited (EarthCo), a new U.K.-registered company which will now be trading as “Showmax.”
EarthCo’s senior leadership team will be based in its Dubai office — where MultiChoice has a presence — as well as the U.K., with operational teams in South Africa and Nigeria. In Nigeria, NBCUniversal will hold an indirect 23.7% stake in the local Showmax subsidiary. The relaunched streamer will be “powered by Peacock’s leading, globally-scaled technology”.
MultiChoice told Variety that it plans to keep the Showmax brand name since it’s a known and recognized brand across the African continent. But the company notes that the new Showmax will bring an “extensive” premium content portfolio with a bigger trove of international content, balanced with African-produced fare. The launch date and pricing of the new platform is yet to be announced.
Besides content funnelled from NBCUniversal and Sky, the redeveloped Showmax will carry third-party content from HBO, Warner Bros. Discovery, Sony and others, as well as live English Premier League (EPL) football, Showmax Originals from Africa, and programming from M-Net’s linear pay-TV channels on DStv, such as Mzansi Magic, Africa Magic and Maisha Magic.
“This agreement represents a great opportunity for our Showmax team to scale even greater heights by working with a leading global player in Comcast and its subsidiaries,” said Calvo Mawela, MultiChoice CEO, in a statement.
Matt Strauss, chairman of direct-to-consumer and international at NBCUniversal, added that the investment in Africa’s Showmax is “an incredible opportunity to further scale the global presence of Peacock’s world-class streaming technology.”
Marie Lora-Mungai, founder of Restless Global, a strategic advisory firm specialized in the African creative and sports sectors, said the deal could be transformative for the African streaming space.
“This is a big, bold move that puts Showmax in the right position to compete properly with Netflix, Amazon and Disney on the continent.
“Remember as well that Vivendi’s Canal+, a leader on the Francophone market, now owns more than 30% of MultiChoice, and that both entities have been busy ramping up their investments in quality Africa original co-productions,” Lora-Mungai added.
“For NBCUniversal, whose Peacock has been struggling in the U.S., it’s a strategic move to capture one of the last emerging markets still up for the taking. This type of consolidation signals more opportunities and bigger budgets for African content producers in the near future.”
Michael Markovitz, head of the GIBS Media Leadership think tank in South Africa, tells Variety that the partnership could indeed be a powerful streaming partnership.
“Relaunching Showmax with NBCUniversal’s technology platform Peacock and premium content from both NBCUniversal and Sky will reduce MultiChoice’s content and technology costs and give them a stronger hand when competing with global subscription streamers like Netflix, Amazon Prime, Disney+ and HBO.
“This announcement also indicates the difficulty of going it alone in a very competitive streaming market. We are seeing even stronger, continent-wide companies like MultiChoice pivoting to strategic partnerships with global players.”
Further, by retaining 70% equity in the venture, says Markovitz, MultiChoice is “probably taking the long view with respect to potential regulation of streaming platforms in Africa.”
Dr Musawenkosi Ndlovu, associate professor at the Centre for Film and Media Studies at the University of Cape Town, notes that tough competition from other streaming services likely compelled MultiChoice to re-evaluate its “go it alone” strategy if it needs to survive in the long term.
“MultiChoice, and NBCUniversal/Sky and its Peacock platform need each other. MultiChoice already has a big market in Africa it established. It is a growing market. NBCUniversal/Sky and its Peacock platform have the content and technology. They can deliver faster.”
“Losing identity is less of an issue than making profit and surviving,” Ndlovu adds. “MultiChoice will actually be launching its war on all fronts. It’s going to continue with the production of local content, too. However, it wants to keep and grow its premium clients who tend to have more options and a global outlook.”
Ndlovu says the MultiChoice/NBCUniversal/Sky partnership is a business strategy “that aims to make money later and prevent someone else staying the course and then winning in the end”.
As to the flurry of other smaller, regionalized African streaming services also trying to compete with Showmax, Ndlovu says they should capitulate or consolidate. “Showmax may have a future. The rest should just go and focus on the provision of sports content. They are wasting their time.”