A few days ago, I wrote that Amazon was partnering with Airtel to offer affordable streaming services in India: “If you look at it, the competition has shifted from pure contents to distribution. In the pure analog world, ‘content is king’, but in the digital space, besides the content, you need superb distribution as digital makes everyone local and global at the same time, shaping the order of competition. Why? In a world of unbounded supply, made possible by the web, people want the least friction for whatever you want them to use…anyone who can figure out distribution in SVOD will win a big part of the opportunity in Africa.”
Interestingly, Showmax, a business of MultiChoice, is responding immediately by blunting that potential Amazon Prime threat in the making. The company is teaming up with MTN Nigeria to “launch a special data deal for mobile subscribers. ..A Showmax Mobile subscription gives access to the full Showmax catalogue on a data-enabled mobile device” at a very competitive rate. Simply, Showmax will pay for the data costs to MTN, and with that, it is reducing the distribution frictions for users.
“Mobile streaming is an important consideration throughout Africa,” says Yolisa Phahle, CEO for General Entertainment and Connected Video at MultiChoice Group, “which is why Showmax offers mobile-only versions of Showmax subscriptions. We’re proud to have an extensive collection of the continent’s most-loved original African content to share with MTN’s customers and to introduce them to the world of streaming on Showmax.”
As I have written, to win the 21st century digital business, you must work to fix distribution costs since to a large extent, winning demand is more strategic than supply. In the SVOD (stream video on demand), a big part of the cost remains the broadband cost, and if you can reduce that for users, you will unlock more scaling. Of course, you must calibrate to ensure that you also capture value while helping the users.