South Africa’s loss-making public broadcaster surprised everyone on Thursday when it launched its long-running broadcast programme, dubbing SABC+ with the aim of reaching two million users over the next year.
SABC acquires and rebrands TelkomONE Streamer from the country’s quasi-state telco Telkom, launching content from its linear TV package of SABC1, SABC2, SABC3, SABC News and SABC Sports, its 19 radio stations, plus 2,000 hours of other programming in Circle for library content on demand.
SABC+ is late and hotly contested in Africa’s most developed video broadcasting region.
The new platform will take on global services ranging from Netflix, Disney+, Apple TV+ and Prime Video, along with regional broadcasters such as African pay-TV operator Showmax MultiChoice and eMedia’s eVOD, all of which are struggling to increase subscribers and engagement.
The launch comes more than a month after the broadcaster went live without a board. diverse Understands that the new board of directors still does not exist.
Following Thursday’s announcement, SABC’s COO Ian Platjes sat down diverse for an extensive interview.
Why is SABC+ launching now and not in 2023?
We have been planning to launch an OTT platform; We were in the process of re-issuing a tender. Telkom made the decision to discontinue their platform and offered us to take TelkomONE as it is, essentially, a lock, stock and barrel. This created a sense of urgency in why we launched Live Now with SABC+.
What is the deal value?
Telkom had a license, and since they were going to stop it over a period of time and phase it out, they offered that for us to take over. We have a license for a year. We have a very aggressive plan to roll out SABC+ to 2 million users within a year and then move everything to whatever back-end platform we’re going to choose.
How many users does SABC+ inherit?
Just over 150,000.
You mentioned urgency when the license became available. How urgent is SABIC to invest in getting the streaming service up and running?
It was necessary that we go live this year. Unfortunately, we had to withdraw the original bid and were in the process of reissuing it – which would have delayed the rollout. We’re losing about 80% of our revenue from linear TV to digital TV and we had to stop that. So that’s a revenue protection strategy but also a revenue growth strategy. The timing of SABC+ is absolutely perfect because we also have the FIFA World Cup Qatar 2022 starting in three days and we have those rights. It’s one of those divine moments: You couldn’t ask for a better time.
Linear ratings for SABC channels are declining. Is there a fear of SABC+ cannibalizing viewership?
They certainly don’t eat, but they do migrate. What we don’t want to do is lose our linear audience. We actually want to provide them with an alternative viewing option for our content. Instead of losing them, we deport them.
What will SABC + operating expenses be?
It’s very hard to tell because we inherited the platform as is from Telkom. All content that is there will remain. When we go and buy the rights, we always take into consideration the broadcast rights as well. So for us, it’s not going to be an additional cost from a content perspective. Going forward, there will be some strategy around additional channels on SABC+ which may be an additional cost since we may not have the same channel on the line. Every channel we launch, whether it’s a permanent channel on SABC+ or a pop-up, is going to be at breakeven or profitable. We wouldn’t run any of those at a loss.
What is generally the SABC OTT strategy?
Obviously, this is the launch phase. If you look at what we inherited, TelkomONE has an SVOD service. When those commitments run out, we’ll definitely change that to an AVOD service. Sports are going to be big on OTT for us, especially community sports.
What represents success?
For the first year, we have a very strong target. We set a goal of reaching 1 million subscribers or users within the first year. However, we set ourselves a stretch target of taking that to 2 million. The success factor will be 1 million; 1 to 2 million would certainly be our expectations.
When will SABC+ become profitable?
Since we are taking over and someone else has already borne some of the cost, it will already be possible from day one. The market for scatter ads already exists, and the ability to monetize the platform and put ads out there from day one, so it’s instantly possible.
Only 18% of TV households on SABC books pay TV license fees. Why is a valid license number not required to access SABC+?
At other stages, TV license checks are on the cards but as an incentive rather than a stick. It won’t stop you from watching, but it will motivate you to do more.
Was SABC+ always the name?
Obviously, we’ve had some time already because we knew we were going to have our own OTT in the market. We launched a contest where people can submit name recommendations. We have a panel and have tested some names in a panel to understand consumer feedback. We tested it with agencies, too. The agreed opinion was SABC+.
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