*Says: ‘The perception that we are a monopoly is wrong’
M ultichoice, pay-TV operator (DSTV), is 20 years old. In this interview, the Managing Director, Mr John Ugbe, speaks on the milestone. Excerpts:
Your company is 20 years old. Looking back, how has the experience been?
It has been interesting, particularly if we have to look back to when we started which predated the advent of democracy in our country. We started at a time that was difficult; a time when Nigeria was not the most popular for investors. Most investors came after the advent of democracy.
In spite of the uncertainties of the period, , MultiChoice saw the great future Nigeria held and realised that a big part of that future would lie in entertainment given that the country has rich culture, human resources and the ability of its peoples to develop. So, the company has grown with Nigeria over the last 20 years and, to a large extent, we have kept the country entertained and helped build family bonds during that period.
What made Nigeria appealing to MCN?
If we look at the heritage of MCN, you will see that it is an African company that started in, and believe in Africa. Nigeria was and remains appealing to MCN because it is one country you will come into and find everything you need. The company has been able to bring international entertainment into Nigeria and has taken Nigerian entertainment to Africa and the world. We have shown a focus to develop contents from within the country and placed it on an international pedestal.
I will say that if you go around Africa, now, you can see that DSTV and, now GoTv, have impacted on the image of Nigeria and the understanding of her culture. From the economic point of view, Nigeria is a big market and, as the country develops, the middle class grows and we believe that we cannot tell Africa’s story without Nigeria because it is the heart of Africa. The key thing for MCN is that we believe in the Nigerian story.
Doing business in Nigeria must definitely have challenges. What are those challenges and how have you been able to surmount them?
We try not to focus on the challenges. No nation, including those you will say are perfect, is immune from some inherent challenges. Like I said, we came at a time when Nigeria had not become democratic and getting a license to operate then was not easy. Nigeria has always had infrastructure problem. However we tend to see how we can work around the challenges. Also, being an African company means that we experience those challenges in few of our markets and our strength, as a company, is to understand those challenges and, very early on, develop strategies on how we can achieve what we set out to achieve even around those challenges. So I think growing a business in the country requires a lot of understanding on how to overcome the infrastructure problems and we have done so to the best of our knowledge and experience.
There is the tendency to view business investments with suspicions and given that MCN has dominated the satellite-to-home television market in Nigeria, some see you as a near monopoly. How have you managed this?
I think a lot of it is perception and we have been haunted by those perceptions, which have not helped the image of the company. However what has kept MCN going is that the company was not built and it is not built for immediate profit. MCN is a company with a long-term vision and the perception that we are a monopoly is wrong. At every point, we have always had competition, even if the competition has changed from time to time. We are in the business of entertainment and you will agree with me that we are not the only one in the entertainment business or pay TV business in Nigeria.
MCN, like I said, is a company with a long-term vision and it believes in investment, particularly in infrastructure, which we have done quite a lot, and in people. Our strongest asset is our people and it is the same way we treat the talents, which abound in the entertainment industry in Nigeria. If you look at our development of the contents of the Africa Magic Channel, with most of it coming from Nigeria, you will see an attempt to develop something that will be lasting, as well as to be able to leave a strong legacy for the future.
Aside what you have said, what can you point at other tangible contributions of MCN to Nigeria and Nigerians?
We can look at that from different angles. You cannot tell the story of where Nigerian music has gotten to today without Channel O. A lot of people who visit other African countries are amazed about the popularity of Nigerian artistes presently compared to where the old masters in Nigerian entertainment were. Another example is the development of the Africa Magic channel. Not only that, we have also invested in sports through our present sponsorship of the Nigerian Basketball League, as well as ensuring that Nigerian football league are shown on live television through our Super Sports channel.
For instance, the Nigerian team at the Africa Cup of Nations had a good number of home-based players and nobody would have known those guys and even the coach would not have been able to see all of them, if not that we showcase them by broadcasting their games live on television. It is a massive investment, which has kept Nigerian football, live on air. We have high definition OB vans, which are handled by our Nigerian engineers, to ensure that those events are shown live.
We have also invested in studios in Nigeria and we are currently building additional ones. I can say that a part of our biggest investment is in our distribution chain, which we developed a long time ago. We have been able to create a distribution chain through an entrepreneurship programme, and we call them the ‘super dealers’. From a little chain, it grew bigger and we have been able to create large businesses, which are owned by Nigerians and they have provided employment for thousands of Nigerians. What we did was that rather than creating branches, we ensured that Nigerians owned part of our business and they have in themselves become large employers of labour.
We do a lot of training and development and we have been supporting the chain to see that it keeps growing. In terms of our workforce, the guy putting up a satellite dish on someone’s house is an extension of our workforce, even if he doesn’t work directly with us. Our approach has not always been to hire everyone directly, but to let people create businesses, which are closely tied to what we are doing. Basically, we encourage partnership, which gives opportunities to people. For us, it is a matter of continuing investments, because we have not even started yet. We want to ensure that we invest more and grow the contents.
Statistically, what is your contribution to the growth of Nigeria’s economy?
It is not easy to say what the exact figure is in terms of our contribution to the economy. But if you have to compare what the value of the entertainment industry was 20 years ago and now, you will see that billions of dollars have been invested. It will help you appreciate the development we have had to do over the years. For instance, some of the biggest directors in the entertainment industry today came out of the New Direction, which was an initiative of MNet over ten years ago.
Some of the said directors who were part of that programme own their own TV channels today; an example is Tajudeen Adepetu of Sound City. So, you can see an initiative that centred on directing and producing turning into owning a television station. Also, we have also impacted on the quality of Nigerian artistes. Many of the artistes, who go to, say Uganda or other African countries, to perform and are paid millions of dollars may not have been known in those countries but for DSTV, and we can take the fact that Nigerian films are now being hawked on the streets of Kenya and other African countries as the evidence of our investment and all these impact on the Nigerian economy.
And in terms of the quantum of our direct investment, MCN has spent over N55billion in the development of content technology and people in the last ten years. For us, it is like sowing seeds, which the most important aspect of, is seeing and moulding what germinates from of it. Despite the fact we have a bright future, we are not concentrating wholly on profit-making because we are an African company first and foremost and it is not as if we came to Africa to make money out of Africa.
Taking a peep into the future, where do you hope MCN will be in the next 20 years?
I can say that the next 20 years will be exciting and entertaining. We are the number one pay television company in Africa, which has been providing lots of entertainment and we hope to be bigger and the best in the world. We believe that we can achieve that because we have the human capital, culture, idea and young vibrant people who are learning from our different initiatives. We are doing a lot of work on improving the quality of production in movie making and, if you look closely, you will see continuous improvement in sound and direction in our movies. Everyone thinks we are only in the business of entertainment, but we also do other things. We collaborate with CNN to organise training for journalists and the African Journalist of the Year award. So, there is a lot we are doing to contribute to learning, development and investment.
Many Nigerians believed that they are robbed by having to pay for DSTV subscription even when they are not watching. When should Nigeria expect a pay per view payment plan, like it is done in South Africa?
We don’t operate any pay per view in South Africa and it is not possible to do that technologically. Although many expect that it should be like it is done when you make a call, but that is where we have to separate telephony from broadcasting. Unlike communication, broadcasting technology is one-way in the sense that there is no direct communication with the source broadcasting to you through your decoder.
Let me give an analogy here: ‘If you buy a ticket to watch a film, which, say, has been hyped to be the best movie in the world and you are dissatisfied with it after getting into theatre, do you get a refund?’ That is the scenario with the digital satellite broadcasting. We are an aggregator of contents and the owners of the contents don’t expect to know from me the number of people watching it at a particular time in order to give a refund. It is contents aggregation business, in which we buy so many contents, aggregate them and buy a library, so that the clients can get what they want from what I have put together. That is the model of pay television worldwide.
It is a different kettle of fish from telephony, which has no original content, but left to the users to create the contents. Telephony is a large spectrum that can be broken into pieces, making it possible to attach a cost to it. If a subscriber to a pay television is not watching a particular channel, someone else is. It is a business in which different pay televisions buy the same contents, show the same content, sometimes at a very big loss. I think there is confusion about what pay per view is. Pay view is done for special events.
For instance, if a big boxing match is to hold and it is advertised on a particular DSTV channel, everyone who desires gets to watch it. In the US and other parts of the world where they practice pay per view, you have to pay a special cost, in addition to your regular subscription, for that privilege. If you pay and one of the boxes decides to do what Mike Tyson used to do by knocking his opponents out in the first or second round, you will definitely not get a refund. Basically, there is no technology to support pay as you go broadcasting that now. If there is, you will have seen it pop up in other parts of the world.
How has DSTV been able to export Nigerian culture to the world?
For us, that is our biggest joy. If a Nigerian flies into any African country now, what he hears is “oga”(master) or “bawo ni” (how are you?) and he is shocked and wondering why. That is the impact of DSTV. That is the beauty of what we have been able to do in terms of promoting and exporting our cultures, value, language, lifestyle as a strong-spirited people, as well as exporting them to the outside world.
To a large extent, we have been able to project a larger understanding of our culture and an aggregation of it in the eyes of the world and the story of that cultural export cannot be told without MultiChoice or DSTV. I think Africa Magic has been a huge success through which we have managed to arrest the attention of the whole continent. Considerably, we have managed to present a different story about Nigeria apart from what is broadcast on the news channel.
Given that DSTV has been around for long before the introduction of GoTv. What have been the responses to it?
GoTv is a new product from the MultiChoice management and it is available all around Africa. It is a milestone for MultiChoice being the first company outside the US to deploy digital mobile television. So, for us the digital story started with DSTV a long time ago and I can say that a lot is still coming. For instance, we will be launching a new decoder soon, which is a special one for Nigeria and that will give us an opportunity to be where we have not been.
Talking about technology and innovations, to what extent do you involve experts from Nigeria in all of that?
Innovation is one of our core values and many Nigerians are involved in the innovative products we have made. For MultiChoice, innovation is key and people are encouraged to participate in achieving that. Our products have a local appeal and many of them are developed locally for that purpose. We train and retrain people and I can say that Nigeria is right there in technological developments. DSTV was the second television, outside America, to be launched on digital satellite in the world ahead of Europe and Asia. Our dual-view decoder is the first in the world and our belief is that Africa deserves nothing but the best in entertainment.