More and more streaming services from around the world are coming to Africa because of increased competition in northern America and Europe. Companies like Walt Disney, Netflix, and Amazon Prime are expanding their services into the African market. Though there is stiff competition from local African streaming services such as Iroku TV in Nigeria, Showmax in South Africa, and Viusasa in Kenya,Africa offers an optimistic market for its services.
A young population, improved internet connectivity, and a growing middle-class population create a growing environment. The number of users in the video streaming segment is expected to reach 17530 million in 2027, with a revenue collection of US$3.67 billion, up from US$232 billion in 2023.
The importance of Africa as a growing market for streaming services
Large audience
Africa has arguably the youngest population in the world, with 60% of its population below the age of 25 years.These tech-savvy youths have adopted the technology, making up for the demand for video-on-demand services. This age group presents an opportunity for businesses wanting to set up a streaming service in Africa.
Relatable content
Creating content that can resonate with a diverse audience in terms of culture, religion, lifestyle, background, and all that can be difficult. But something about the African stories is that they’re relatable and acceptable worldwide, if not all of them.
Video streaming services in Africa
Nigeria
Nigeria is among the most populous countries in the world, and streaming services are growing rapidly. This is because of the tech-savvy young population that is active online, internet penetration, and access to smartphones. The Nigerian streaming market is big, with international companies also eyeing the market. The popular streaming services in the region are Netflix, Showmax, and YouTube. The local streaming services are Iroko TV, Ebonylife, and Ibuka TV.
They are made for Nigerians, offering Nollywood movies. With the young population in the most populous country in Africa, the streaming market is likely to grow. Statistics show that revenue is expected to reach $087 billion in 2023. The user penetration will be 173% in 2023 and is expected to hit 218% by 2027.
Impact of mobile video consumption on Nigeria’s market
When it comes to watching video-on-demand services, mobile devices are the most used devices in Africa. According to a survey by GeoPoll in 2020, 91% of Africans in the sub-Saharan Africa countries were using their phones, while only 9% had access to laptops and desktops. This can also be attributed to the ease that comes with phones. In East Africa, for instance, and more specifically in Kenya, mobile money is the go-to choice when paying a subscription fee. So many people will use mobile apps as opposed to desktop apps to have a smoother ride with payment.
Most of the streaming services can be accessed on mobile devices. Netflix has an app, as do Showmax and many others. Mobile video consumption has had a significant impact on Nigeria’s market. The number one impact is on advertising. While many people are glued to their phones and tablets, commercial companies have come up with mobile ads to reach their audience. There has also been an increase in local content. Many artists and content creators have shifted to uploading their content on YouTube and other services that are way cheaper and more accessible. The creation of content has grown tremendously.
South Africa
With over 90% of South Africans having access to an internet connection, streaming in the country is a big deal. South Africa is topping the list for streaming in Africa. The local talent is crazy, with lots of local dramas and shows such as Blood and Water, Queen Sono, etc. One of the most popular streaming services in the country since its launch in 2016 is Netflix. Disney+, YouTube, and Amazon Prime Video Local VOD includes Dstv, owned by Multichoice, and Showmax. The market is set to reach US $2.71 million in 2023 with a growth rate of 14–13%, resulting in a market volume of US $460 million by 2027.
Impact of local content on South Africa’s streaming market
Netflix has been keen on funding African originals. Queen Sono, Young, Famous, and African are among the shows that have received the funding. The end product is quality film and pictures that can compete with Hollywood movies.
Some of these films are cast in the local dialects spoken in the country. This in itself is one way of creating a huge fan base among locals. People love it when you can speak their language; they understand more of what you are trying to say.
The African stories have also been shared with the world. Through local content, documentaries have been featured, featuring African lifestyles portrayed as in the movie “Young, Famous, and African.” The world has known what it would not have known if we had continued to be glued to Western contents.
Egypt
Egypt, a country with a large group of young consumers who are active online, is among the fastest-growing streaming markets in Africa. Netflix has a foothold in the country. Amazon Prime Video and YouTube are also among the international companies in the region. Local streaming services include Shahid VIP, StarzPlay, and OSN streaming. With the increase of video-on-demand, statistics show that the video streaming market will reach US$437 million in 2023, with an annual growth rate of 11.97%.
Impact of political instability on the Egypt streaming market
Where there’s no peace, everything else stops. From the economy to consumer use, it suffers. In a situation where there’s instability, the economy goes down because nobody is investing. With the economic shutdown, consumers are also forced to forego some things; streaming becomes a luxury. Therefore, there’s a decrease in the subscription of the streaming services as a way of cutting on expenses. It also has an impact on the region’s infrastructure and internet accessibility.slow internet and poor streaming services. The government is also likely to censor the content available on the streaming services. This is for their political interests.
Kenya
Kenya is a strategic market in the East African region. Global streaming services are making their way into the market. They are pouring millions of shillings into local dramas and shows to secure original content. At least 90% of the Kenyan population has 4G network coverage, with a large group having smartphones. The country also has a young, tech-savvy population that is very active online.
The most popular streaming video services in Kenya are Netflix and YouTube. It came onto the market in 2016, and it boasts a huge subscriber base because of its wide range of movie options. Showmax, Disney+, Apple+, Amazon Prime Video, and Iroko TV are also present in the country. Viusasa is a local service that was launched recently. It offers Kenyan dramas and shows. It has a huge following in the country because it is relatable to the people. The revenue is expected to hit US$5147 million in 2023, with an annual growth rate of 1824% resulting in a projected market volume of US$10060 million by 2037.
Impact of government regulations on the Kenyan streaming market
The Kenyan government signed an agreement (called a memorandum of understanding or MoU) with Netflix. This agreement will help train young filmmakers, support local talent, and protect the digital market. As a result, Netflix is expected to make more money by producing good movies and TV shows in Kenya.
Conclusion
The African streaming market is a growing one with a lot of potential. That is why streaming services are coming this way in large numbers. For Netflix and Showmax, for instance, slashing the subscription fee in select African countries is a good move. It only shows that Africa is a big market with a lot of room for growth in the streaming market.
Main photo: By SYLLA Cheick 225 - Own work, CC BY-SA 4.0, https://commons.wikimedia.org/w/index.php?curid=88239880
