Up and coming streaming service provider, Iflix, has announced the sale of its African operations, Kwese Iflix, to Econet Group. The move cements the Zimbabwean Econet Group’s pursuit to develop new revenue streams in the digital world.
Netflix rival iflix sells #African #business to local partner Econet Global Limited DEALSTREETASIA On-demand video streaming startup iflix, an emerging markets rival to Netflix, has effectively pulled out of Africa afte… https://t.co/CYh9jcRS8X via @theafricamentor #africabiz pic.twitter.com/yGbbhQgs13— Africa Mentor (@TheAfricaMentor) December 27, 2018
The Malaysian-based Iflix is looking to concentrate its business operations in Asia where it has the upper hand against industry bigwig, Netflix.
Interestingly, prior to the sale, Econet Group was already heavily invested in Iflix Africa. Iflix, in partnership with Econet’s Kwese pay tv service, launched its Iflix Africa operations way back in June 2017. But in February, Kwese acquired a significant stake in Iflix Africa. The deal led to a name change: Iflix Africa became Kwese Iflix.
Ever since the deal in February however, Iflix has gradually limited its role in the Sub-Saharan division. Although the partnership with Kwese gave it an edge in Africa over rivals like IrokoTV and even Netflix, its uptake was quite poor. The service reportedly had significantly lower patronage compared to other brands.
But worse, with services like Netflix increasing their pool of local African content, Iflix Africa was always going to struggle. In 2018, Netflix budgeted $8 billion for original content production globally. But in perspective, Iflix has only been able to raise $300 million funding since it launched in 2014.
So, although divesting from Africa means significantly reduced global reach, it does allow Iflix leverage to grow in the bubbling Asian market.
Econet Group Scores Another Win
Telecom conglomerate, Econet, has been dangling into a string of non-telecom businesses over the last few years. From logistics to ridesharing and banking, the Zimbabwe company has quickly emerged as a strong player in Africa’s digital frontier. The ownership of Iflix’s Africa operations only helps to amplify this.
Family can be filled with ups and downs but survives through it all with love. Asunder is about three families who struggle to stay together through the best and worst of times.— Kwesé iflix Nigeria (@kweseiflixng) December 30, 2018
Download the #kweseiflix app now to watch https://t.co/0Qjq7JcxQI pic.twitter.com/DtzDDjPmlW
Econet’s Kwese pay tv division launched in 2017, but it has expanded quickly across the continent. The service currently operates in 13 countries.
Also, in November 2017, Kwese scrapped it satellite TV business, Kwese TV. These include Kwese Free Sports (KFS), a free to air service that has a pan-African reach; Kwese Iflix, a competitor to Netflix and iRokoTV; and Kwese Play, a TV on-demand service.
This move allows the company to concentrate its energy in providing its digital offerings.
But all is not smooth-sailing yet. Kwese has a lot of work promoting the newly acquired Iflix service. A possible rebranding will follow but a lot of investment will be needed to help the service edge out Netflix’s rising Africa focus.
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