Coalition of Nigeria consumers tackles Multichoice over proposed price hike · DStv cheaper in Nigeria than other African countries
A Coalition of Nigeria Consumers has expressed concerns over the recent announcement by Multichoice Nigeria Limited, providers of Digital Satellite Television services on (DStv and GOtv) platforms, that it will increase its subscription price from June 1.
This was contained in a petition sent to the director-general of the Federal Competition and Consumer Protection Commission (FCCPC) through the F. S Onifade & Associates titled “powers of the commission to regulate price: abuse of power of dominace in markets and impending price hike by multichoice/dstv in Nigeria.”
Managing Partner at the F.S Onifade & Associates, Mr Festus Onifade, said the petition was anchored on “Power of Abuse of Dominance” as provided for in new law FCCPC Act 2018 signed into law by President Muhammadu Buhari in February, 2019 which is prohibited under Section 72 of the FCCP Act.
The Act empowers the FCCC to fix and regulate prices of goods and services where such infractions have been brought to the notice of the Commission.
According to the petition, the increment plans by the company citing the increase in VAT rate as the reason, makes it the third time in a period of five years despite court injunctions against similar increment which was not obeyed.
It, therefore, called on the Commission to under law and new identity save the Nigeria consumer from another oppressive private monopoly, noting that out of about 14.56 million subscribers on across Africa, Nigeria alone has 40 per cent of this numbers as at 2019 making her the largest and leading satellite TV service provider in Nigeria.
“You will recall that Mutilchoice Nigeria Limited had recently announced that it will be increasing its rates for DStv and GOtv subscribers from 1st June, 2020, citing the increase in VAT rate as the reason for this imminent price increment.
“Our client also noted with grave concerns that apart from the pattern of (content recycling) of repetitive films and programmes; many local TV Channels which ought to be free are paid for by Nigeria consumers as opposed to the practice of enjoying free local TV Channels in other part of the world.
“Worst still is that with a monthly premium subscription rate of about N16, 000 our client and Nigerian consumers are greatly surcharge. This is because with an average of 720 hours per month, an average view is about six hours per day. If usage is converted to hourly basis this same amount will give a consumer four months value. Hence, we advocate ‘pay as you use.’
Meanwhile, a report shows DStv cheaper in Nigeria than other African countries as information on the DStv website has revealed that Nigerians pay over 55 per cent less than other countries on the continent.
When compared to Ghana, Kenya and South Africa, DStv Compact costs N6,975 in Nigeria, equivalent to $15.50, while the same package costs 140GHS in Ghana, which is equivalent to $25.45..
In Kenya, DStv Compact costs KES 2,455, an equivalent of $24.55, while the same service goes for R359 ($21.11) in South Africa.
Also, in a recent financial report released by MultiChoice Group, South Africa has 43 per cent of its subscriber base and generates 66.35 per cent of its revenue, while Nigeria generates 10.89 per cent.
It further showed that a profit of $617.69 million was generated in South Africa with a trading margin of 30 per cent, while Nigeria did $329 million, 100 per cent less than what was realised in South Africa.
MultiChoice Group listed its challenges in Nigeria as: sporadic payment of government employees; food and travel inflation, which had a negative impact on consumer spend; and low oil price that increased the risk of currency weakness.
