Cape Town – The arrival of Netflix is a shot in the arm for the streaming movement in South Africa and may help locals save money while watching favourite TV shows, says an industry expert.
“Contrary to popular belief, a decent internet connection that will allow you to use a streaming service like Netflix does not have to break the bank. In fact, it might be cost efficient in the long run,” said Greg Wright, product owner at Webafrica.
Netflix subscriptions priced in dollars start at $7.99 per month (R132) while Naspers-owned [JSE:NPN] rival ShowMax is priced at R99.
One challenge is that users have to ensure they have a high speed internet connection to access services.
“Take fibre-to-the-home (FTTH), for example: FTTH allows users to stream footage on demand, without buffering. Unlike ADSL, with FTTH there is no requirement to couple Telkom voice lines with a fibre line. Saying goodbye to Telkom voice lines means a monthly saving of R186 per month,” said Wright.
In SA, a DStv premium subscription costs R699 and unplugging to opt for streaming could reduce the cost of watching TV.
For example, OpenWeb offers a 4 megabit per second uncapped ADSL package for R389 per month, though customers will likely have to pay Telkom a line rental.
In the UK, streaming TV is proving a serious challenge to the BBC which suffered a £150m licence shortfall as consumers switched to the alternate technology.
In SA, the technology will likely affect subscription TV well before it impacts on the SABC.
"Streaming is a much bigger threat to a subscription pay TV company like DStv, where the customer profile (especially in the Premium package) is most likely to have the required connectivity," Andrew Fraser, former TV producer recently told Fin24.
South Africans may follow developed markets where streaming TV has overtaken traditional broadcasting.
According to an Ericsson Consumer Lab that focused on the US, South Korea and Spain, more people watched streaming television than broadcast TV for the first time in 2014.
*Fin24 is a division of Media24, a subsidiary of Naspers
- Follow Duncan on Twitter