Competition reduces cost of Pay TV services in Kenya
2012/48/28

NAIROBI, July 26 (Xinhua) -- The cost of pay TV services in Kenya has dropped considerably, becoming accessible to many Kenyans who have been locked out of the sector due to high prices.

Stiff competition in the lucrative sector has seen prices of pay TV gadgets and subscriptions decline as service providers seek to retain their customers and attract new ones.

Kenyans can now acquire pay TV decoders from as little as 35 U. S. dollars, down from over 150 dollars some years back.

Similarly, subscribers are paying as low as 6 dollars a month, down from 71 dollars some years ago, to get the mobile digital television services.

Fight for customers in the sector has intensified with the entrance of StarTimes, a China-based broadcasting company, which officially launched its operations in the east African nation on Wednesday.

The industry, before the launch of StarTimes, had four players namely DStv, My TV, Star TV and Zuku TV.

However, South Africa's DStv, which has been in Kenya for about 15 years, is the market leader and enjoys almost a monopoly.

Its dominant position in the sector and exclusive rights to screen English Premiership League, which is loved by many Kenyans, has in the past made it difficult for other companies to break into the market.

StarTimes, however, has rattled the market with its prices, which target the mass market. The company's customers are buying decoders at 35 dollars.

Thereafter, subscription rates vary, with packages that go for 6 dollars, 11 dollars, 23 dollars and 30 dollars.

With the products, StarTimes has intensified competition and battle for customers in the sector. Other service providers have reacted to the company's quest to reach the mass market by lowering their prices.

Top on the list is DStv, which has lowered prices of all its services as it seeks to retain customers, fight off competition and enhance access of its services.

The company has dropped by 27 percent the cost of all its mobile digital television gadgets that include Walka, Drifta, USB Drifta and GOtv decoders.

Walka, which was going for 122 dollars, now retails at 89 dollars. Drifta, which was selling at 120 dollars, similarly retails at 89 dollars. The cost of USB Drifta has dropped to 53 dollars from 79 dollars.

Subscribers for the hand-held devices access about 15 channels with subscription of between 4.5 dollars and 11 dollars a month depending on the package.

For decoders, price for standard gadget has dropped from 71 dollars to 47 dollars and GOtv decoder is retailing at 39 dollars, down from 74 dollars.

"We have always regarded competition as a healthy portfolio for the market, but the move to reduce prices is to enable those who genuinely want to be entertained but cannot afford the gadgets," said DStv-Mobile manager Felix Kyengo recently while announcing the offer that targets Olympic Games, which will be viewed by millions of people across the globe.

"We are not competing with others. We just want to focus on our own business to bring really good, reliable, affordable products and service to more Kenyan people," said Li Weizhong to Xinhua, the manager of StarTime Kenya.

As the pay TV companies battle it out, consumers in the east African nation are turning out to be the winners. Most Kenyans are now subscribing for the services that for many years have been associated with high-income earners.

"We appreciate the entrance of new companies in the sector, which has boost competition. We are now benefitting from affordable pay TV services," Jared Otieno, who subscribed to the services two weeks ago, said on Thursday.

Otieno noted that with low prices of digital television gadgets and subscription rates, most people in the east African nation, especially the middle and low income earners will access the service.

"Low costs will help more people to subscribe to the services thus spread reach. Pay TV, as any other technology, should be adopted by the masses if the sector is to develop. Kenya has lagged behind in the industry because of lack of competition," said Otieno. He said he can now pay for the services every month without feeling a pinch.

"Pay TV was considered a luxury because of high costs. But now that we are paying as low as 6 dollars a month, one cannot feel the pinch," he said.

Kenyans are expected to access pay TV services at even more cheaper rates since other service providers are set to enter the market.

The Communication Commission of Kenya announced last month that it will issue licences to 168 operators, as the east African nation speeds up switch from analogue to digital broadcasting.

Across east African region, it is estimated that about 20 million households have TV sets. However, less than 250,000 households have subscribed to pay TV, with high costs being cited as the main reason.

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