DStv-owner MultiChoice announces massive streaming video deal

3 years ago 1

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MultiChoice has announced an agreement with Comcast’s NBCUniversal and Sky that will see South Africa’s broadcasting giant sell a 30% stake in Showmax.

The new Showmax group will be powered by Peacock’s technology, will remain 70% MultiChoice-owned, and will be 30% owned by NBCUniversal.

Peacock is NBCUniversal’s video streaming service.

MultiChoice explained that it has incorporated Earth UK Holdings Limited (EarthCo), a new UK-registered company that will trade as Showmax.

The DStv owner will contribute its existing Showmax business for a 70% equity stake in EarthCo.

MultiChoice will also provide ongoing business support through its local market expertise, local content production capabilities, its portfolio of general entertainment and sports rights licenses and its back-office support functions.

Comcast, through its subsidiary NBCUniversal, will inject cash for a 30% equity stake in EarthCo.

It will also provide ongoing support through the licensing of both its Peacock platform and content from NBCUniversal, Universal Pictures, Peacock, and Sky.

EarthCo will hold a 100% interest in Showmax SA Pty Ltd.

Showmax SA will own all the Showmax rights, assets and liabilities in South Africa, a 79% stake in MSA Limited Nigeria, and the rest of the African operations.

MSA Limited Nigeria will own MultiChoice’s Nigerian rights, assets and liabilities. The deal will result in Comcast owning an indirect stake in MSA Limited Nigeria of 23.7%.

EarthCo will be supported at launch by MultiChoice’s local pay-TV operations.

It will provide a streaming service on the African continent, powered by Peacock’s technology and using the Showmax brand.

MultiChoice and Comcast have committed to provide funding to EarthCo during its investment phase in proportion to their respective shareholdings.

EarthCo’s board of directors will consist of three representatives from MultiChoice initially, with additional appointments to be made in due course.

The board will appoint an executive management team that will feature representatives from the existing Showmax structures, which will be infused with global talent in the coming months.

EarthCo’s senior leadership team will be based out of the UK and its Dubai branch.

Operational teams will be located in major markets, initially South Africa and Nigeria.

The agreement does not involve the broadband, wireless or cable video or any other of the businesses of either Comcast or Sky.

It also excludes the linear satellite, terrestrial, and streaming video businesses of MultiChoice (apart from services support), all of which will continue to operate independently and at an arm’s length.

“Due to competitive sensitivities, specifics about the unique service offering, how existing subscribers can seamlessly migrate to the new service and detailed pricing will be announced closer to the launch date,” MultiChoice stated.

“Showmax customers will continue to enjoy the existing Showmax service up until the new service is launched.”

MultiChoice promised the new Showmax will build on the platform’s success to date, and strive to create the leading streaming service in Africa.

“The service will combine MultiChoice’s accelerating investment in local content with an extensive pipeline of international content licensed from NBCUniversal and Sky,” it stated.

“This will be complemented by third party content from HBO, Warner Brothers International, Sony and others, as well as live English Premier League football.”

African content such as Showmax Originals, and local content from MultiChoice’s proprietary channels including Mzansi Magic, Africa Magic, and Maisha Magic are also part of the deal.