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MultiChoice Says There Will Be No DStv Price Increase Outside SA

MultiChoice Africa Limited, a subsidiary of Naspers Limited today announced that there will be no price increase for subscribers to its DStv service (direct-to-home satellite television service) in the majority of its African markets outside South Africa.

“As a group, we believe in the longer term potential of our markets in Africa. We will therefore provide the necessary financial support to MultiChoice Africa. We are in a position to do this because most of the Naspers group business (65% of revenue) is outside Africa, where times are better and our businesses are in good shape.” said Naspers CEO, Bob Van Dijk.

Price increases usually occur annually around 1 April and the firm recently announced an 8.6% price hike in South Africa already. The firm says it won’t increase its prices in other countries as most African markets have suffered as a result of commodity and oil price weakness, and because of the significant devaluation of local currencies.

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Many of MultiChoice Africa’s costs are incurred in dollars, which forced it to pass through price increases in 2015. Nevertheless, MultiChoice Africa continues to suffer adverse impacts from the economic environment.

Since subscribers are still under severe financial pressure, MultiChoice Africa has decided not to increase subscription prices for DStv in most of its markets in 2016.

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In September last year,  MultiChoice announced a price hike for its DStv subscription rates citing a strong dollar against a weak Kenyan shilling but it didn’t go well with its subscribers.

The firm has not said by how much the rates will be hiked but only announced that the increase is necessitated by Foreign exchange rate changes. The firm didn’t say whether it’s other service GOtv will be affected or not.

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“The continuous depreciation of the Kenyan Shilling against the US Dollar has negatively impacted the business -this is similar to other imported services where costs are originated in US Dollars. For months, MultiChoice has held off passing through this price increase to subscribers and has absorbed the foreign exchange losses; however, it is no longer possible to avoid a price adjustment on DStv subscriptions,” the firm announced in a statement at the time.

However, this year, the firm has decided not to.

Imtiaz Patel CEO of Naspers’s Video entertainment segment said. “We believe MultiChoice Africa is correctly responding to prevailing market conditions. Barring any further external economic shocks, we do not anticipate a price increase in 2016. “

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Sam Wakoba
Sam Wakobahttp://techmoran.com
Taking you on tour through Africa's tech and business ecosystem, one story at a time since 2010! Based out of Nairobi, Kenya, Sam is the founder and managing director of Moran Media, which runs  TechMoran.com, various other digital platforms and a startup incubation hub for Kenya's youthful entrepreneurs. Drop me a mail at [email protected]

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