South African Telkom Removes Netflix From Its Video Service

South African wireless telecommunications provider Telkom SA SOC Limited has stated that beginning from October, the popular video streaming platform Netflix will no longer be accessible on its platform. The telecommunication company which is said to have been operating in more than 38 countries across the African continent discloses that Netflix will no longer be available on South African phones and the company’s internet set-top box.

This news was disclosed by Wanda Mkhize, Telkom’s Content Executive. Mkhize disclosed that the contract binding the 2 companies has reached an end, however as at the time of put compiling this, both parts have no plans of renewing deals. The reason for this wasn’t disclosed. Mkhize said “Our current partnership with Netflix has unfortunately come to an end…. While customers will no longer have access to Netflix on the Telkom set-top box from 1 October 2021, they will still be able to access other OTT services on their STB.”

The partnership with both parties which began in 2018, highlighted Netflix’s first agreement with a South African telecommunications company. While the partnership lasted quite a large number of local content were produced on Netflix which drew much attention across the continent. Some of these local content include “Queen Sono” and “Blood and Water” and many more. While Telkom may have no plans of renewing a partnership with the popular video streaming platform, Telkom has however assured customers there would be no worries as the telecommunication companies have plans to onboard new partnerships with guaranteed new and fresh content. Mkhize said that “We have exciting new and refreshed content partnerships for our valued customers which will be announced in due course,” the telecom giant said.

Fans have also reacted severely following the announcement from the telecommunications company., Fans have complained, quite a number have expressed utmost shock, a customer specifically didn’t hide the fact that the reason for the purchase of Telkom’s set-top box in the first place was because of Netflix. Telkom’s customer Siyazi Wanjali expressed disappointment saying “I feel robbed.” Wanjali further says that “I bought these Telkom LIT devices with the certain capability of which now they can longer deliver. Worse, it was not even communicated to me, neither by Telkom nor Netflix, and my debit order went through.” Telkom however, has gotten all the feedback and has reached a decision to compensate customers who purchases the Telkom LIT box in the past 6 months. Such customers have been assured of voucher compensations of about R1000.

Speculations say the reason why the telecommunication company didn’t renew its partnership with Netflix may be as a result of its partnership with MultiChoice Group Limited. Although MultiChoice has also signed partnership deals with Netflix and Amazon to offer users these services through its new decoder. MultiChoice Group Limited remains Africa’s leading entertainment and pay-tv provider. The company has entertained, informed, and empowered Africans through compelling local and international stories, which continues to bring people together around a shared passion.

This announcement also comes at a season when the popular video streaming company continues to record a decline of subscribers, a rate it has been experiencing since after the pandemic. According to Technext, when the lockdown was at its height, the video streaming company boosted about 15.8 million new customers, this year as in the first quarter of 2021, the video streaming company managed just about 3.98 million new sign-ups. This is way below the 6.25 million average projection of analysts surveyed by Refinitiv, according to a Reuters report. Also, Netflix shares also fell 11% at the time, wiping $25 billion off the company’s market capitalization. This was a massive decline following a 22% share rise in the 12 months prior. Africa is a small market for paid video streaming, with just a few million subscribers out of a population of more than 1 billion, and the U.S. giants have targeted it for future growth. To make up for this, the video streaming service is looking to add customers outside of more saturated markets such as the United States.

In a bid to penetrate, grow and conquer more African territories the streaming company announced the appointment of Zimbabwean media tycoon Strive Masiyiwa as its first African board member. Another plan Netflix has put in place to remain relevant was the decision to enter the gaming market according to its Q2 report. The streaming platform will now have a new content category called Games.