Local consumers have become hungrier than ever for video-on-demand (VOD) services - a hunger that is only going to intensify.
While SA may have the technology, it does not yet have the affordable, ubiquitous infrastructure required to satisfy it.
During the latter half of this year, local ICT players heeded the demand and opportunity, with Times Media Group and Altech debuting their respective VOD products, and the likes of Orange and Vodacom expressing their desire to follow suit.
Last night, Naspers-owned MultiChoice announced its limited push VOD offering, Catch Up, would soon be amplified, thanks to its flagship decoder the Explora having its Internet pipe opened up. However, the service requires that DStv premium customers (the only group the improved VOD offering is available to) link their decoder to an existing Internet router, which will feed the large amounts of data required to download movies.
In addition, as it stands, DStv customers won't really have the whole "watch what you want, when you want" experience VOD is famed for, because - to quote MultiChoice - "broadband speeds are not yet fast enough for instant downloads or streaming".
ICT expert Adrian Schofield says DStv's new offering amounts to hybrid VOD, rather than being a truly online service. "The additional content has to be downloaded before it can be played back, thanks to lousy broadband speeds in SA, [plus] the customer has to have an Internet connection with sufficient 'cap' to cover the requested downloads - at a cost."
African predicament
Peter Ostapiuk, vice-president of media product management at Intelsat, says broadband and Internet service providers are looking to deliver media content via mobile devices and infrastructure in Africa. However, the truth is that they are not yet suited to handle and transport the sheer size and volume of media content that is needed by the population they are trying to serve, he notes.
Eckart Zollner, business development manager of the Jasco Group, says VOD is a welcome service for some African countries, like Namibia, which has invested heavily in infrastructure that may still be under-utilised. In SA, however, he notes VOD is a slow-moving industry because of the lack of last mile connections - although he says these are being created "as we speak", with companies and communities introducing dedicated fibre connectivity.
He says, though, what the local market really wants, is one subscription that offers Internet, voice and video ? all from one provider, like they already have elsewhere. "We don't have convergence yet. That will still happen and I think partnerships and consolidation between operators and content providers will be the way forward when it comes to triple play services. At the moment, we have Telkom, Vodacom, DStv, etc. In Europe, there is true convergence, where a consumer can purchase a bundle for all the services they want, from one provider."
Schofield echoes Ostapiuk's view, saying networks in Africa are not yet able to carry the traffic that true VOD to a mass market will impose - and SA is no exception. "I think SA is largely in the same situation, particularly as we are already trying to 'squeeze a quart into a pint pot' due to the lack of appropriate spectrum for true broadband speeds."
Mobile market
Vodacom, which recently started offering streaming service Deezer, is looking to extend its content offerings and is pondering VOD - an ambition the company says its fibre plans will make possible. Vodacom CEO Shameel Joosub says the operator will selectively play in this space, where there is money to be made.
Zollner says the mobile device market is one that will provide justifiable cause to launch VOD services into Southern African markets. "According to Statistics SA, there are approximately 10 million TVs in SA - but, according to the African mobile observatory report, there are approximately 59 million cellphones already in the market. It is predicted that in two years' time, approximately half the number of these cellphones will have been replaced by smartphones that can stream video content.
"Furthermore, consider the number of people that have purchased tablets or have laptops that too can stream video content. This will further drive the uptake of VOD in SA and the rest of Africa."
Over the last few years, telcos have invested hugely in their networks. Zollner says, noting that although a large proportion has already been built, much of it may be under-utilised - but, once last mile connections are in place, VOD will come. "Why else would you run fibre into someone's house? It's for high-bandwidth services like high-definition TV. That is what people will pay for."
Schofield says mobile operators are between a rock and a hard place in the whole VOD picture. "Their traditional 'skills' are the provision of the network and the connection of the devices. They need new skills if they are to manage the delivery of content which they must purchase, store and market. Convergence suggests they have to go this route."
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