Rising Popularity of Streaming Services Led to A Decline In Digital TV Subscriptions – CAK

The use of online streaming services in Kenya has risen rapidly, many people prefer using online service producers such as Netflix, Showmax, and Youtube which have become increasingly affordable, available and convenient for many users.

This has negatively affected digital TVs whose subscriptions, according to the latest statistics report by the Communications Authority declined by 7.1 percent to 5.4 million for the period between April to June 2019.

“The wane in subscriptions for digital TV is attributed to the increased uptake of streaming services especially among younger consumers, as more homes get connected devices,” the report noted.

On the other hand, the CA report noted that the total number of Free-to-Air TV Stations grew by 6.3 percent to record 86 stations from 81 stations recorded in the previous period.

Digital TV business has been on the low owing to the rising popularity of online service providers. Recently, MultiChoice Kenya’s Digital Satellite Television (DStv) announced plans to lower its monthly subscriptions charges in a bid to ward off competition.

This was seen as part of the firm’s strategy to counter rising competition for pay-TV customers from new Internet-based streaming entrants whose demand have been boosted by available home internet connections from various service providers.

The Kenyan Government has also weighed in on the matter, the ICT Ministry said that it is developing a framework which will ensure the services are subjected to the Kenyan tax system.

Communications Authority director-general Francis Wangusi said that the new technologies will be introduced to facilitate taxation of Over The Top services.

The Kenya Revenue Authority has also said that it will liaise with CA to obtain transactions data by resident and foreign-based app developers doing business in Kenya.

This will be done to seek income tax from income-generating digital applications, those that sell goods and services and those that require users to pay before downloading.

The back and forth between the two providers still continues across Africa and beyond. In what is seen as a competition strategy, South African-based Showmax announced plans to introduce a mobile-only streaming package in Kenya which will cost approximately Kes 350 bob a month.

In the past, South African cable TV provider, MultiChoice has demanded the regulation of Netflix regulated after it lost over 100,000 premium subscribers in a year.

Featured Image Courtesy: Bbc.com