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Who is buying Multichoice shares?

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South African media and e-commerce group Naspers has gained stock exchange approval to spin-off and list Multichoice, Africa’s biggest pay-TV business by subscribers, the company said on Monday.

Multichoice stock will list on February 27, Naspers said in a Johannesburg Stock Exchange announcement, with the share capital going to current Naspers shareholders.

 

So, who of you guys are buying the dinosaur?

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Personally, I won't touch multichoice just because they screwed over too many South Africans and played a part in the Gupta ordeal.

 

Now with that said, MultiChoice Group Limited (MCG) will include, amongst others, MultiChoice South Africa (MCSA), MultiChoice Africa, Showmax, as well as the global digital platform security provider, Irdeto and all their subsidiaries and affiliates.

 

Irdeto is interesting, they essentially provide the security layer for cable network services like the operating system running on your DSTV console. What makes them interesting is that they also provide security for companies using open source software like Android on their set-top boxes, thus playing an important role in the MCG group since Comcast (Xfinity, a Nasdaq listed company) and the British free-to-air television channel ITV forms part of Irdeto's portfolio. They also play a role in securing IoT devices, which will take over when 5G is fully adopted in the next few years.

 

As for MultiChoice South Africa (MCSA) if they lose SuperSport they lose their premium subscribers, the majority of their premium subscribers already have access to the internet (above 4Mbps) and thus can and will switch to Netflix.

 

MultiChoice Africa will be the one to carry the group in my opinion, Africa is big and technology is slow. Internet access is limited and satellite often are the only way to reach these guys.

 

Showmax should be the main focus on MCG, the internet is the future and streaming content and more specific, content on demand is the future. Developer skill is a major problem both for Showmax and DSTV Go at this stage, they are trying to compete with Netflix and Amazon Prime, but neither Showmax nor DSTV Go has the technical ability to take these companies on, so I foresee a few years of poaching talent and upping spending (paying a premium) to higher better developers. 

 

Conclusion and personal bias aside, MCG has a lot of potential if they can lean up the company and focus on improving their technical ability, I am very interested to see their finances when they announce it.

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