Africa: GTV Gets $35 Million Boost As It Targets 1 Million Viewers

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The East African (Nairobi)

5 October 2008
Posted to the web 6 October 2008

Philip Ngunjiri
Nairobi

Pan African satellite TV operator GTV has received a capitalisation of $35 million, bringing the total capital invested into the company to almost $200 million.

The company is also getting a $675 million cheque from mobile operator Vodacom Group, which has agreed to buy its telecommunications business.

GTV founder and managing director Julian McIntyre said these two parallel investment schemes will chart a new course for the pay-TV market in sub-Saharan Africa.

Mr McIntyre said the company hopes to reach over 250,000 subscribers by the end of next year from the current 100,000, and one million within three or four years. It also plans to operate in up to 35 countries by the end of 2008.

According to Mr McIntyre, consumer demand for GTV and its services has resulted in his company becoming Africa's fastest growing pay-television service, according to a study by a London-based consultancy and research firm, Balancing Act.

According to the study, GTV took "five out of every seven new subscribers" who chose satellite TV in Africa over the past nine months.

Africa represents the last great frontier media market in the world, Mr McIntyre said.

Recent studies show that less than 2 per cent of sub-Saharan African homes that have television sets subscribe to pay-TV services, compared with 15 per cent in Eastern Europe, 36 per cent in Western Europe and 93 per cent in North America. In Kenya, out of 2.2 million TV set owners, only 30,000 subscribe to satellite television services.

GTV is a wholly owned subsidiary of Gateway Communications, which provides satellite direct-to-home TV services across sub-Saharan Africa. Gateway Communications is a leading satellite communications company serving African telecom operators and corporations.

Any pay television service keen to penetrate the African market should put the issue of affordability at centrestage, as many African viewers cannot part with a lot of money for services that do not give value for money, said Mr McIntyre.

GTV brings its African viewers a range of channels and content from the African continent.

The programmes aired by the service cover a diverse range of news, sports, movies, music, and religious content.

"We intend to come up with different programming that suits different countries. In Kenya, for instance, we are planning to bring on board religious programmes that have proven a hit. This is a Kenyan phenomenon," he said.

GTV will be investing up to $5 million in Ugandan soccer over the next five years, including the first regular broadcasts of matches in the country's top national league.

GTV's mode of service delivery is direct-to-home, satellite-based services that deliver high quality digital reception across the continent. This delivery platform has substantially reduced the cost and ease of set-up.

Apart from Kenya, GTV is also available in Botswana, Cameroon, DRC, Ethiopia, Gabon, Gambia, Ghana, Lesotho, Liberia, Malawi, Mozambique, Namibia, Rwanda, Sierra Leone, Swaziland, Tanzania, Uganda, Zambia and Zimbabwe.

Since its entry into the African market, less that 2 years ago, GTV has outbid the main existing satellite broadcaster in the region, MultiChoice of South Africa, for the rights to broadcast most of the English Premier League's soccer matches.

It has secured the rights to 80 percent of Premier League matches that has a huge following in Africa, where African-born players like Didier Drogba and Michael Essien of Chelsea and Kolo Toure of Arsenal are household names.

Outside South Africa, where the satellite broadcaster MultiChoice has 1.3 million customers, pay TV has primarily been affordable only to a small elite and to international hotels.

MultiChoice has about 450,000 subscribers in the rest of sub-Saharan Africa, a region with a population of more than 700 million.

Other African pay TV operators have only small national or regional presences.

CanalSat Horizons, part of Canal Plus of France, is available in Francophone regions of West Africa.

Prices vary by country, in Kenya, for example, GTV's top package is priced at about $40 a month, compared with about $70 for MultiChoice's premium plan, which includes broadcasts of the 20 percent of Premier League matches not shown by GTV.

Demand for the GTV service, noted McIntyre has been driven by the chance to enjoy a broad range of high quality television channels at an affordable price, with various packages to meet the budgets of African families.

Among other things, it targets customers who have hitherto been unable to afford subscription services and who have been limited to national, free-to-air television stations. GTV's home grown channels include the popular 'G Prime', which is an entertainment and movie channel, and 'G Sports' that airs 'live' international and African sports including European football.

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