Will Netflix Really Make A Difference In Africa?

Let’s not go that far, yet. Let’s start from Nigeria. Yesterday, when the news broke about Netflix being available in almost every country, there were different reactions from Nigeria. Of all the reactions possible, I simply thought “welcome to Nigeria”.

I wasn’t excited about the news because despite what Jason tells us about the success or otherwise and consumer demography patterns of iRoko Global, I think Netflix won’t make a huge difference in Nigeria. At least, for now.

Here are my major reasons:

• Cost of data: Data is still a very expensive commodity and it doesn’t look like it is getting cheaper anytime soon. Let’s not even mention the cost of getting a smart TV.
• Connection Speed: The average connection speed in Nigeria is about 2.9Mbps and this number is due to increasing usage of 4GLte networks. 3G networks which most people use are probably slower.
• Attitude: Nigerian prefer to download things for free rather than pay for it so people will wait for the hacker/IT guy who can rip the video off while it is streaming and then share via hard drives and other media.

While there was an Ericsson ConsumerLab report that says Nigerian now watch more video on mobile, I don’t fully agree due to the same reason but like a friend of mine said – “if more Nigerians are watching videos online, then the next frontier for any serious company is video”. This means, even if the report is disproved due to the small sample size of just 1500 from 7 major cities from a large available data of about 80million people, it should still be considered.

Currently, from an in-house survey, majority of the videos being consumed by most Nigerians are short videos (mostly comic Instagram videos) which are not more than 10 minutes (music videos and prank videos) at most and are usually shared within friends using apps like Xender.

Even Jason Njoku whose business is more or less a direct competition to Netflix is not bothered because his major users are not based on the continent so what makes us suddenly think their coming will truly make a difference? If Jason has not been able to get the networks to create an exclusive iRoko TV package, why should we think Netflix will suddenly make an MTN create a specific VoD data plan? As of this moment, only etisalat has a video-only data plan and they have added Netflix to that but we’ll probably only be able to watch a single movie in an instance at a price of 400Naira for 2 hours streaming. DoBox does seem to have a partnership with all the networks but they definitely do not have Orange Is The New Black. The quality of the stream and the network is another issue entirely.

However, the reality is that we live in a country where opulent estates share borders with slums and billions of dollars disappear when people live on less than 2 dollars a day so in this same country, there are places where the speed is amazingly fast and where the cost of data is not even a concern. They represent a very small fraction of the populace though so their combined 12USD may not be enough of a convincing argument. Don’t let’s even forget that we really can’t spend anyhow right now, with the restriction placed on Nigerian debit cards internationally.

We can speculate all we want as things get more interesting but we can only know what will eventually happen by chilling.