VOD (video-on-demand) is still a fledgling market locally, according to BMI-TechKnowledge’s recent DLP research.
When respondents were asked to name VOD providers in South Africa, only 18% mentioned pure play VOD providers. What stood out in the VOD space is the strength of the leading subscription TV player in terms of awareness(86%), contrasted against low levels of awareness of the pure play VOD providers.
Mobile telecommunications providers garnered 43% of the awareness, with Internet service providers coming in at 19%. Fixed line telecommunications providers fared worse than pure VOD players at 17%, with online stores at 9% and banks at 6%.
Clinton Jacobs, senior research analyst at BMI-T, comments: “It is interesting that VOD, at this stage, is seen by most as an addition to subscription TV rather than a replacement. That then also speaks to what consumers would be willing to pay – much less than if it would be seen as a replacement service. The additional cost of data usage must also always be kept in mind.”
While awareness of VOD services other than DStv’s own VOD offerings is relatively low, usage of pure play VOD is even more so.
However, a quarter of those currently not using VOD are interested in doing so, and almost 80% of those considering VOD are considering it in addition to subscription TV. Two-thirds of respondents say subscription TV providers would be their most likely choice for a VOD provider. This is also a reflection of current VOD usage patterns, which are dominated by DStv’s own offerings, including BoxOffice.
Almost a quarter of respondents say mobile telecoms providers would be their most likely choice. Pure play VOD providers received a surprisingly low mention rate. However, 18% would still consider them, which is significant at this early stage of market development and awareness, and this number is likely to grow rapidly once Netflix, for example, is officially launched in South Africa, raising general awareness levels.
Naspers’ ShowMax, was only launched after the survey was completed. “It will be interesting to see how awareness has grown due to the strong promotion, including advertising in traditional media,” notes Jacobs.
South African Video on Demand (VOD) penetration forecasts range from 692 000 to 917 500 active user households by 2020.
These findings form part of BMI-T’s recently-released SA Consumer Digital Lifestyle Research Programme (DLP), based on metropolitan surveys of 1 500 respondents. This year, the VOD and fibre to the home (FTTH) research modules were added, to the research into PC, tablet, smartphone and internet usage and activities.
