Video On Demand trends in Africa

April 7, 2015

A streaming video on demand service can have a massive library of movies and TV online, but just as important is actually guiding you to easily find and watch that video.There is a battle going on in the video on demand market in Africa. As young and trendy users demand movies and television shows faster and cheaper than ever before, while expecting the same quality as consumers in developed world, companies are trying to enter the market while existing ones are trying to corner theirs.New research in my possession shows that the strong preference for Bollywood and Nollywood films in African cinemas is not so overwhelming online compared to hollywood movies.This is just one aspect of Online and on Demand.Trends in African Online Video Use, a report I can only describe as “the first ever concrete profile” of African video-on-demand audiences when it was availed to me last week notes an increase in Internet protocol enabled video consumption devices such as smartphones and tablets has brought unified multiscreen experience to viewers in Africa. The African film industry is strengthening its position and earning global recognition, both in prestigious global film festivals and in terms of box office ratings. A study by the management-consulting firm Ernst & Young predicts that Africa will be among the largest film market in 2025. Apart from Nigeria, South Africa, other countries like Tanzania, Ghana are also gaining stronger positions in the African film market.

Respondents cinema habits
• 63% of all Africans VOD users say they go to Hollywood films,
• 17% say they go to Africans films
• 20% say they go to independent and arthouse films like Nollywood, Bollywood.

VOD environment
• 55% say they watch Hollywood films
• 15% say they watch Africans films
• 30% say they watch independent/arthouse films like Nollywood, Bollywood

This inclination towards a more mixed diet occurs across all small screens. In the case of broadcast TV for example, which is the most popular platform for watching homegrown films, 33% of VOD users say they watch African films and 67% say they watch non-African films.The new report deeply examines African vs Hollywood vs independent or arthouse preferences via the four types of VOD namely catch-up television provided that is slowly taking shape in the continent and supported by advertising or taxpayers funding.The struggle of those involved in the movie industry won’t be satisfied without the support and programs of their governments. For instance, Nigeria launched a cash rebate production program for local and international production and for post production in Nigeria. This is meant to stimulate local film production and make Nigeria a film production center and shooting location. South Africa also sees big co-production opportunities, with its government offering splendid locations and pre-production and production facilities. Without formal education and training as well as some knowledge of the global film industry, no African country will be able to produce quality movies in a sustainable manner.But African and foreign TV series are driving VOD in Africa, not movies, and it would be misleading to call VOD growth dramatic.

Africans still spend most of their time watching content on traditional platforms so what they watch has not changed much. Even those who regularly pay for VOD content are hungry for content across all platforms.For this study, 21% of Africa’s population is defined as an Internet user, that is, anyone aged 18 years and over who has been active online at least once a month. Half of this 21% are watching a small proportion of professionally produced film, television and video health online  up from 6% in 2013 and these people are those described as VOD viewers in the report.High costs, a lack of technical know-how and slow Internet speeds are barriers to online take-up in Africa and there are one in five VOD viewers with high-speed connections and they are almost twice as likely to consider using subscription VOD services.One trend is that VOD is a more solitary activity 72% of VOD viewers report that the main way they watch is alone and 90% of those said that being alone is one of the ways they watch.A general reluctance to pay much for content was identified with a staggering 57% of VOD viewers reporting that they have no interest in paid models.Africans are not accustomed to paying for television. Subscription TV has never exceeded 10% of households in Africa and there is no requirement to have a TV license as is the case with countries like UK.The report paints the online video market as fragmented but set for a shake-up with the arrival of Netflix and new providers expected in coming months.The challenge is to find ways to monetize content through these new platforms as they increasingly disrupt traditional business models.

Coupled with the fact that production companies in Africa today have to distribute directly to local theaters, the cost burden is not only for production but also for distribution and promotion. The small domestic market inevitably prompts companies to explore the markets of other countries like Nigerian movies producers have done with foray in East African market with Kenya and Tanzania being their core markets. Co-distribution becomes a solution, as coproduced films from West African countries promise a bigger market for survival.The Africa film industry still has the potential for further growth and Nigerian filmmakers are virtually among the best in the continent. The country’s unique dialect, beautiful nature and locations have not yet been fully exposed on a global scale and its production costs are relatively lower than in other African countries.Just for the record Mr Ibu whose real name John Okafor happens to be my favorite actor in Africa. On the piracy front so far available data shows that nine per cent only view illegally, 31% use legal and illegal services, and 60% only view legally. Standalone laptops and PCs are used by 47% of VOD users, a TV-connected devices like PVR, laptop, smart TV, games console to mention but a few by by 23%, a tablet by 16% and a mobile phone by 14%.The figures that I have several days to peruse through show that the industry is worthy of promotion and still offers good prospects for development. However, many things must still be carried out by various parties, while gifted filmmakers need support in order to survive in the industry. Amid ongoing globalization, integrated government programs and policies are required to bolster Africa’s movie industry.The presence of movie professionals like Mr Ibu whose creativity is in a class of his own, profound knowledge, passion and integrity is also important for the progress of this industry that will increase the market share of the African local films in VOD and On Demand platforms.

Contador Harrison