Can streaming services thrive in Nigeria's regulatory landscape?
Key questions:
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Netflix reports it has invested $23.6 million in Nigeria so far. Can the Nigerian market provide Netflix and other Subscription video-on-demand services with a return on their investment?
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New amendments to laws will give Nigerian regulators more power over on-demand video platforms. How will these changes affect the platforms and their user base in Nigeria?
On April 6th, Gangs of Lagos, the emotion-stirring Amazon original crime thriller, premiered in a colourful event in Victoria Island, Lagos. A week later, Netflix released its impact report, telling the world it had invested $23.6 million in Nigeria between 2016 and 2022.
All this has been received with mixed reactions. From outcries against cultural misrepresentation to various takes comparing Netflix's investment in Nigeria and South Africa. The activity and reception point to something more salient—the increased influence of video-on-demand (VOD) platforms on Nigerian storytelling, popular culture, and the economy. We have gone from watching movies like Karashika and End of the Wicked on colour Televisions (TVs) to streaming Gangs of Lagos from our smart devices, whether in transit or at home.
In the past, the only option to get video entertainment was to sit in front of a tv connected to a satellite, cables or a home video player. For traditional tv, viewers were confined to the programmes broadcast by the service providers and tv stations. For example, in the early 2000s, Silverbird TV broadcast Pinky and the Brain and other cartoons between 8 a.m. and 10 a.m. on Saturdays. If you missed it, you were on your own.
Essentially, this mode, called “linear programming”, meant that viewers could not control what they watched. But the internet came, letting users watch curated tv shows, movies, documentaries, and random video content, from websites or applications; think Netflix and YouTube. While we colloquially call them “streaming” services, they are collectively known as OTT services because they deliver their content over the internet.
PwC estimates revenues from Over-The-Top (OTT) services in Nigeria, which VOD platforms fall under, will grow annually at 12.2% between 2021 and 2026, almost 3x faster than traditional TV and home video revenues (4.6%). While there are some base effects at play here, this substantial growth means Nigerians are embracing
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