Multichoice’s DStv is by any measure the largest supplier of premium sports, movies and TV content over Africa. Now Kenya’s competition regulator is to investigate DStv’s market dominance following on from the collapse of Smart TV last week. Smart TV wasn’t alone: Gateway’s GTV went bust in 2009, and while there there are other players in the market (notably Wananchi’s Zuku pay TV) they do not find life easy.
And the market is considerable. Of an estimated three million TV homes – not all at the wealthy end of the market, of course – fewer than about 130,000 subscribe to pay-TV. Smart TV failed with less than 2,000 subscribers.
Kenya’s newly established competition authority says it will seek to establish whether DStv has “unwarranted concentration of economic power that locks the majority of Kenyans into its network and prevents new operators from turning a profit,” according to local reports.
Wang’ombe Kariuki, the acting DG of Kenya’s Competition Authority, told Nairobi’s Business Daily that the regulator is looking at the whole pay-TV market to establish whether the dominance of one player is behind the recent collapse of the operators or if it was the inefficiencies of the collapsed companies. The Authority can fine companies and individuals KES 10m, and issue jail terms of five years, or both. While these penalties are not likely in this case it could well be that changes are enforced on DStv.