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Iflix set to take on Netflix and ShowMax in Africa
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Thu, 09 Mar 2017 10:01

Netflix and ShowMax competitor Iflix, which is promising a lower-cost alternative video-on-demand service, is soon to be launched in Africa.

Iflix, a video streaming service with customers mostly in Southeast Asia, raised US$90m (about R1,2bn) in a round led by telecommunications giants Liberty Global and Kuwait-based Zain to take on Netflix and Naspers, which owns ShowMax, in Africa and the Middle East.

The investment will also fund expansions throughout Asia, the company said in an e-mailed statement on Tuesday, 7 March 2017. Iflix has approached its entry into Africa fairly quietly to date. But it has already established a head office in Cape Town, along with offices in Johannesburg, Nairobi, Accra and Lagos. The Cape Town office has about 25 employees, with eight in Johannesburg.

Iflix offers customers in nine countries a mix of Hollywood fare like the film Iron Man and TV series Homeland along with local programming for a monthly subscription fee. The company has signed up more than 5m customers — more than analysts estimate Netflix, the world’s largest paid video service, has in Southeast Asia.

The streaming provider is looking to capitalise on its early success in the region by spreading to emerging markets elsewhere, starting with the Middle East and Africa. It has also formed a joint venture in the Middle East and North Africa with Mobile Telecommunication Co, known as Zain, which has 47m customers in eight countries.
“It was always meant to be a Southeast Asian business, but it grew so fast,” Patrick Grove, Iflix co-founder and chairman, said in an interview. Grove started the company with fellow entrepreneur Mark Britt, the company’s CEO, with support from Hollywood’s Creative Artists Agency and private equity firm TPG Growth.

Iflix has succeeded, Grove said, by positioning itself as cheap alternative to piracy, which is rampant in poorer countries where most people don’t pay for cable. Though the membership fee varies by country, it costs about as much as a pirated DVD typically does in those markets. In Malaysia, Iflix runs about $1,80/month for an annual subscription. Netflix’s service starts at about $8/month in many markets.
South Africans and users in the other African markets where Iflix will be launched can look forward to a mix of Hollywood and local and regional content. “There will be plenty of African content in there,” according to regional marketing director Jo Eyre, adding that Iflix is talking to content producers in various markets.

The gap in Africa is for a video-on-demand platform at a low cost that appeals to mobile users, Eyre said. The company is promising excellent video quality, even on 3G connections, thanks to advanced compression technology. “ShowMax and Netflix are doing an awesome job, but they are very much focused on the top of the pyramid. We are trying to plug the gap [lower down] with a service that is optimised for mobile.”

However, Iflix will also target higher-end users with high-speed fixed internet connections at home, she said.

© 2017 Bloomberg LP
© 2017 NewsCentral Media

Source: Tech Central and Bloomberg



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