COLUMNS - 28 JUL 2015

PayTV, Mobile Networks, Shopping and Xenophobia

PayTV, Mobile Networks, Shopping and Xenophobia
Pay TV

What do these four things have in common? For many Nigerians, the answer would be "South Africa." As diplomatic relations between both countries suffer due to anti-immigrant violence in South Africa, there have been calls to boycott South African companies in Nigeria as a form of protest, since this has proven somewhat effective in Malawi. Three prominent targets are Multichoice Nigeria Ltd., the company that sells DStv and GOtv services, MTN Nigeria Communications Ltd. and Shoprite Holdings Ltd. The chances of a boycott happening depends on two things: the hassle of avoiding the business has to be low (ease of finding alternatives) and people have to feel strongly enough about the situation/business. Let’s see how likely Nigerians are to boycott these three corporate giants.

DSTV on the Defence

If these boycotts were set in motion, Multichoice would be the first target. Even before reports of the xenophobic attacks, Nigerians were already unhappy with the hikes in DStv and GOtv subscription rates. Many quarters described the increases as exploitative, and two lawyers sued the company to court. Despite an injunction, Multichoice went ahead with the price increases, prompting online protests such as #BoycottDSTVNG on Twitter.

But for a boycott to be successful, Nigerians would need to be comfortable with the alternatives. And while these exist, most of them do not provide access to the quantity and quality of programming that DStv subscribers are used to, particularly with regard to sports channels. The greatest shift is likely to happen among the lower end subscribers since DStv’s basic bouquet is comparable to other cheaper alternatives on the market, particularly StarTimes. One interesting possibility is a mass exodus to Q-Sat, a company that is basically able to tap into DStv’s channels using some form of reverse engineering at rates as low as N100 per month. While the legality of this service is as yet unclear, for the Nigerians who can stomach this ambiguity, Q-Sat would be ideal. (As a side note, because Q-Sat is reliant on DSTV's programming, it has an interest in ensuring DSTV remains in business)

MTN’s Massive Market

The South African telecommunications company stands out in Nigeria for two reasons: it has the largest share of the Nigerian market at 43 percent, and Nigeria’s 61 million subscribers also make up its biggest subscriber base.  Complaints against MTN are not rare, ranging from poor call quality to hidden fees and charges. But then again, the other three networks suffer from the same problems to different extents depending (sometimes literally) on where you’re standing.

With porting now available, leaving MTN wouldn’t be difficult because porting allows users to switch to a different network but keep the same number. Data from the Nigerian Communications Commission (NCC) shows that, even prior to the events in South Africa, between March last year and February this year, MTN had the largest share of subscribers porting their numbers to other networks, and the smallest share of subscribers coming in. However, the figures remain in the thousands, which is unlikely to leave a dent in the 61 million subscriber figure.

Shoprite – the biggest (potential) loser

Nigerians don’t have much of a complaint against Shoprite. In fact, the only thing people have against it right now is that it’s a South African company. Unfortunately for it, it would also be the easiest to boycott because it is a physical store that is not as intertwined with people’s lives as their TVs and mobile phones. It isn't a neighbourhood store that can be found around every corner; it has only 11 locations nationwide. So, making the decision not to enter a Shoprite store would not be difficult for many. And the final nail in the coffin: there are alternatives that offer the same or similar shopping experience and goods at similar prices— Cash and Carry, Park ‘n’ Shop/SPAR etc.

The Verdict

Overall, these companies make an interesting trio. Multichoice is the company that Nigerians are most strongly against but will find hardest to boycott, Shoprite represents the opposite case, and MTN lies somewhere in the middle.

All things considered though, it is unlikely that a boycott will happen. One reason is a peculiarity of the human brain called the status quo bias. People are unlikely to switch to a new state of affairs even when their current situation is worse than the alternative. We see this particularly for DSTV and MTN. Just as most Nigerians use at least two of the four mobile networks, it isn’t unusual to find more than one TV decoder in a Nigerian home. Rather than switch completely, we choose to use multiple alternatives at the same time, thereby never fully shutting the door on any one choice.

Finally, the events in South Africa seemed too far removed from many Nigerians for a boycott to gain impetus. Some have brought in ethnic sentiments claiming that only Igbos are victims of the violence. There are others that think Nigerians should leave South Africa anyway and come back home. And for many, it is still unclear what exactly a boycott would achieve.

 

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Ebehi Iyoha

Ebehi Iyoha

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