African OTT market is ready to expand

OTT growth in Africa

Africa is a distinctive continent when it comes to video streaming services. You might be thinking why? To understand this let’s have a look at the Internet conditions and the current OTT market of Africa.

Internet penetration and OTT market of Africa

Africa’s market is a distinctive market. As the inner areas of the continent do not have proper access to cables, TVs, and the Internet. However, now these regions have better telecom coverage. That helps people to access the internet, and it works as a stimulant for VOD services. 

Moreover, the OTT industry is witnessing exceptional growth over the past year and a half because of the pandemic. After the pandemic, the industry has grown. The national and international markets were exploring the opportunities during the pandemic. The African market is one of them. The exploration states that the African OTT and VOD market will grow at a rapid pace. 

History of Internet penetration

Back in 2016, internet penetration stood at around 16% in Africa. Which was almost around 160 million people. Coming to December 2020, just Nigeria had more than 154 million internet users. The increase in the number of African internet users is mind-boggling and the graph is going up since then.

According to Ericsson, the 5G mobile subscriptions will exceed 580 million by the end of 2021, driven by an estimated one million new 5G mobile subscriptions every day. The report by Ericcson features the breakout statistics from Sub-Saharan African markets, where around 15 percent of mobile subscriptions were for 4G at the end of 2020. Mobile broadband subscriptions in Sub-Saharan Africa will increase and reach around 76 percent of mobile subscriptions by 2026. However, 5G volumes will not grow in the region for 2021 but are likely to reach around 70 million 5G subscriptions in 2026.

African OTT market

So, these were the statistics of the African market. However, there is a huge demand for VOD content among the youth, all around the world. People love consuming entertaining content whenever and wherever they desire. This in turn increases the demand for more platforms, channels, and content providers in the market, and that’s obvious from the growth in the number of content providers. 

With access to better internet, there is an increase in the need for on-demand content. This was not possible because there were no telecom providers in the past and because of the poor internet connectivity people were unable to become a part of the Internet world. After getting better access to the internet, youtube has become one of the most popular accessed sites in the region. This also shows the demand for video and on-demand content in the continent. 

However, Internet penetration is just one thing, if there are no content providers in the market, then there is no way for the media and entertainment industry to grow. Moreover, providing original content and its marketing is a huge and expensive task. In order to get over this, we believe that many VOD players and telecom companies will team up and keep the costs down to release good quality content. Furthermore, the number of smartphone users in the continent is increasing which results in the boom for the mobile internet market as well and that’s why it is a great time for VOD players to set ground and be a part of the growing industry. 

Facts about Africa’s media and entertainment market

South Africa is the 2nd nation to register growth in video consumption on just smartphones, globally. Moreover, Nollywood- Africa’s film industry is the world’s second-largest industry that produces movies. Furthermore, Kenya and Nigeria together account for more than 60% of the total internet users in Africa. It predicts that video advertising in Kenya is to grow big, contributing millions of dollars in 2021. Moreover, SVOD revenue in Nigeria will reach around $700 million by December 2021.

The VOD industry’s revenue in Africa will double from $250 to somewhere around $500 million in the coming years. On the other hand, growth can also be seen in Audio streaming services and is expected to generate $88 million in revenue by the beginning of 2022. 

Growth in Africa’s OTT market from 2017 to 2021

Africa’s market growth is expected to touch the sky in coming years and this seems to be unreal. However, the same trend can be seen if we check our last 3-4 years’ growth.

Have a look at the OTT market user penetration in Africa in 2017 and 2021:

OTT market user penetration in Africa in 2017 and 2021

Furthermore, Have a look at the OTT market revenue in Africa in 2017 and 2021:

OTT market revenue in Africa in 2017 and 2021

This market revenue is divided into 4 categories, VOD (Video on demand), SVOD(Subscription-based Video on demand), Audio streaming, and video advertising. Significant growth can be seen in all the categories.

The situation of VOD in the rest of Africa

After Kenya, Tanzania’s graph shows the highest increase in the internet and mobile penetration, with this the VOD users are also increasing as nowadays people love to consume content as per their comfort. The rest of the counties of the African continent are also following the trend and are actively taking advantage of smartphones with better internet. As the internet has penetrated to the corners of the continent.

Have a look at the Internet penetration comparison between Africa and the rest of the world in march 2020- 1st Quarter

Internet penetration comparison between Africa and the rest of the world in march 2020- 1st Quarter

Moreover, there is no doubt that the African people are a fan of local content. Like any other community, they also love their regional content. That is why regional VOD services have gained so much popularity and acceptance despite having many issues like low access to the internet and that too on higher costs. However, the market is growing with the people taking an interest in VOD content, it growing but slowly and steadily and it will grow in the future as well. 

The business opportunities in the OTT industry for broadcasters and content owners are amazing in the African continent. So, if you are a content owner looking forward to starting your own white-label OTT platform then you need a solution provider to get things done for you. Fortunately, we are here to help, as we are one of the best OTT solution providers. To learn more about us visit our website, Digivive, and get in touch with us. We would love to hear from you.

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