Coming hot on the heels of the news that Netflix was now entering the African video-on-demand market, local VC-backed player iROKO has just announced that it has secured a $19m content and capital deal with French media giant Canal+ and their existing Sweden-based investors, Kinnevik AB.
The company plans to channel the investment into local content financing and production, as well as its product and engineering teams in Lagos and New York. Their ambitions lie in making and commissioning more content, rather than relying on their current business model which sees them licence the majority of films & TV series in their catalogue. According to Jason Njoku, iROKO’s founder and CEO, their plan is to produce at least 300 hours of original content in 2016, with the expectation of doubling that by 2018. The announcement also sees Jacques du Puy, President of Canal+ Overseas, join the iROKO board, a move which will add some interesting Francophone Africa experience to the mix.
Speaking to Njoku, it is clear he is betting heavily on the mobile phone revolution, currently taking place across continental Africa; “With millions more Africans poised to come online via mobile in the coming years, our mission is to lead viewers to content they’ll love.This is something the vast majority of the continent struggles with today. We hope to bridge that divide, and this additional investment supports such a plan. For us, there is no version of reality where the marriage between Africa’s most powerful communication tool [mobile] and the most prolific and loved entertainment provider [Nollywood] won’t be a joyous union.”
Mobile phone subscriptions in Africa are almost at 1 billion and by 2019, it is predicted that smartphone handsets, with which viewers can watch content, will make up 73% of the continent’s devices. As digital devices are now an established means of watching TV and movies in the West, Njoku and his team see no reason why the same will not be replicated across Africa. However, he is acutely aware of the considerable hurdles of working with long format content across Africa, with expensive and unreliable broadband-quality the norm for most people, “The challenges surrounding mobile TV in Africa are mighty, but not insurmountable. It’s human to be entertained and connect over community and we are obsessed with creating Africa’s largest community around local content.
“We have always been crazily bold in our ambitions to bring the content closer to viewers and build a truly frictionless and inclusive entertainment experience. Today’s news improves those odds.”
What with Netflix’s entry into the market in the last fortnight, and other regional players like ShowMax vying for audience share, Africa’s digital content market is, finally, starting to hot up.
Nollywood [Nigerian Hollywood] is the world’s second largest film industry in terms of output, employs ~one million people and constitutes 1.04% of the Nigeria’s GDP. iROKO has previously raised $25m from international investors, including Tiger Global, Kinnevik and RISE Capital.