Entertainment, Arts, Culture and Tourism

BRIGHT O. YEBOAH

CO-FOUNDER & COO, WIFLIX

Entertainment and media covers a range of sectors, some well-established in Africa and other products of the digital revoluon heralded by mass smartphone use. Newspapers and magazines, tradional television, live music, cinema, radio and street-level adversing remain strong on the connent, parcularly in less developed markets. Yet they are no match in the long term for new industries, including video and music streaming, internet adversing and socialmedia.

“The entertainment sector in Africa is sll very much emerging and we have barely scratched the surface of what can be achieved by invesng in African creavity,” says Bright Yeoah, Co-founder of Wi-flix B.V, a strategic advisory firm specialized in the African creave and sport sectors. The tech giants “know that their next billion users will come from Africa, which is why they are all invesng heavily in the connent's internet infrastructure”

Africa's youthful populaon, growing middle class and rising internet connecvity offer a growth opportunity for streaming services in the entertainment, arts and culture industry. The connent's video-on-demand subscripons will almost triple from 4.89 million at the end of 2021 to 13.7 million in 2027. This growth drives the revenues to more than double from US$2.1 million in 2022 to US$3.97 billion in 2027. Nelix and YouTube hold nearly half the market at 48%, but these global players are being confronted with the first signs of market saturaon. The internaonal offerings aren't as aracve to Africans, since people prefer consuming local content. Hence, African streaming services such as the Wi-flix startup in Ghana, Kenya, and Nigeria grew from 300 thousand to over 1 million paid subscribers in 2021 alone. More established providers remain popular, such as IROKOTV and GloTV in Nigeria, and Showmax in

South Africa. These companies can offer large amounts oflocallymadecontentalongsidehigh-endinternaonal offerings.

Over the last five years, Africa has become a prized territory for mulnaonal streaming services in their ongoing bale for supremacy While many naons on the connent are, collecvely speaking, an undeveloped market in this regard, Africa boasts huge potenal for rapidgrowth.

According to a report by London-based intelligence firm Digital TV Research, streaming video on demand (SVOD) subscripons in Africa, which stood at around 5.11 millionbytheendof2021,looksettotripleby2026.This has been driven by the increased connecvity infrastructure throughout Africa, the proliferaon of smart devices and a steadily growing, young, tech-savvy populaon.

Streaming services, by nature, are disruptors. Their presence has already had a significant impact on movie theaters, terrestrial, and cable television markets internaonally, and now local streaming services are staking their claim, country-by-country, across the African connent. We believe that local players have the edge over their internaonal counterparts That is because they are closer to their audience, have a greater knowledge of what they like to watch, and have deeper insightsintohowtheyconsumethatcontent.

We have learned a lot over the past two years. We looked at what the internaonal streaming services were doing and asked – how can we disrupt the

disruptor?

While our audience enjoys internaonal blockbusters, there is a vibrant entertainment culture across the connent that is crying out for recognion. Whether it is music, art, or film and television content, African people love to celebrate their local heroes and we love to consume local content Today, African streaming services like Wi-flix in Ghana, Kenya and Nigeria, and iROKOtv and GloTV in Nigeria, and Showmax in South Africa – are all providing large amounts of locally made content (alongside high-end internaonal offerings), and their offerings are proving more popular with Africanaudiences.

Nelix has even taken noce, pledging to invest R929 million into South Africa's creave industry by 2023, and has entered a collaboraon with EbonyLife to produce films for the Nigerian market Furthermore, local plaorm owners can navigate the entertainment terrain more easily, not just being more in touch with local audiences' tastes, but also being aware of the standards and requirements of the broadcasng authories in theirregions.

Content producers and commissioners have also taken note of the appete for local content. According to Disrupt Africa, African content start-ups had their best funding year on record in 2020, raising a combined total of $13.9 million, almost 19 mes the amount raised in the previous year and nearly 116 mes what was secured in 2018. With entertainment plaorms and start-ups seeing increased success, investors are starng to throw more money behind them, along with fintech, e-commerce and health ventures already in their porolios.

From a recent so survey conducted, It's safe to say that over 70% of Africa's youth populaon have never been to the cinema and yet this is a connent with growing deep internet penetraon of a vibrant, informed and mostly educated young people. Africa has more people of working age than the enre world combined I understand that 41% of the global youth populaon will live in Africa in 2030 and those numbers may double by 2050.

Africa's media and entertainment industry at a crossroad

From Instagram comedians to the telecommunicaons giants that deliver their content, the future of media in Africaisinfizzingferment.

Trapped at home in Nairobi by the Covid-19 pandemic and, like millions around the world, feeling isolated, Elsa Majimbo started posng short comedic videos to Instagram. Sing in bed eang crisps and laughing wildly,Majimboquicklybuiltadevotedfollowing.

Two years on, she boasts 2.5m followers on the social media plaorm; magazine covers; fashion campaigns; and a new home in glitzy West Hollywood. Like many African creators, from YouTubers and gamers to musicians and actors, Majimbo embodies the dizzying growth of the connent's entertainment and media industry

Amid rapid digital adopon, behavioral shis brought about by the Covid-19 pandemic, and stagnang Western markets for companies such as Nelix, YouTube and Facebook, the path to future growth in the dynamic sectorcouldrunthroughAfrica.

As a result, Africa's fractured entertainment and media industry finds itself at a crossroad. As African consumers devote more of their me and money to media, companies will need to be nimble. And while all agree that the sector is embarking on a period of huge expansion on the world's fastest-growing connent, underlying volality means many companies will be le behind.

Tothemthatshallbegivengrowth

Impressive growth in entertainment and media in Africa is being driven by the connent's most developed economies. South Africa, the most industrialized naon, is also the most structured market with an established creave industry and strong talent pool in film, animaon, design, gaming and music. It even has its own streaming service, Showmax The advent of 5G technology in South Africa looks set to boost the sector even more by increasing internet speeds and lowering prices.

Nigeria,withitsenormousyoungtech-savvypopulaon, is Africa's entertainment powerhouse, dominang in music,film,fashionandevenvisualarts.

MeanwhileKenya,EastAfrica'seconomicgiantandstartup hub, holds huge potenal for entertainment and media companies. Last year Nelix released its first Kenyan series, a griy family drama called Country Queen.HighlyarscGhana,too,showsgreatpotenal.

Industry experts say smaller markets including Rwanda, Côte d'Ivoire and even Benin could also help drive growth in the sector. Dakar, Senegal's capital, has established itself as a West African cultural capital and a leading sports hub. And beyond sub-Saharan Africa, Egypt,MoroccoandTunisiaareshowingstronggrowthin gaming,visualartsandanimaonrespecvely

Sll, markets such as Namibia and Botswana are five to six years behind the likes of South Africa, says Fakela, largelyduetothehighpriceofstreamingdataandslower digital uptake – which leave people reliant on tradional media,includingnewspapersandradio.

According to mobile network industry organizaon the GSMA, only 28% of sub-Saharan Africans were connected to the internet by the end of 2020. In some third-er markets, Fakela says, the state sll has a big hold on media – though things are starng to change.

“The cheaper data becomes, the more you have audiences coming through,” he said. “That will create a lot more fragmentaon, but I think it will drive down the costofmedia.”

Lora-Mungai says that Africa's entertainment industry is in the process of structuring itself “About five years ago, governments and development financial instuons, such as Afreximbank, the Internaonal Finance Corporaon, the Agence Française de Développement and its subsidiary Proparco, and the African DevelopmentBank–allthesestartedlookingseriouslyat the creave sector as a source of growth and job creaon,”shesays.

Monesaononthemove

Meanwhile, improvements in internet penetraon, smartphone ownership, online payments and monesaon tools have given African creators access to the global online marketplace. During the pandemic, plaorms such as Instagram and YouTube made monesaon tools, such as mobile payments and adverts,accessibletoAfricancreators,shesays.

As a result, entertainment and media revenue has grown strongly in South Africa, Nigeria and Kenya since 2021 as all three major markets emerged from the pandemic, according to a report by global consultancy firm PwC. Yet Covid-19 also exposed fractures in the industry, with some sub-sectors benefing from behavioral shis and others losing out. Some former niche segments, such as gaming, have become more prominent for instance, while some established sectors such as newspapers are ontheslide.

Adversing was hit hardest by the pandemic, but has experienced the largest rebound since, with internet adversing set to grow rapidly in the coming years. The PwC report claims that 79.7% of entertainment and media revenue gained in South Africa by 2026 will come from internet adversing, as consumers spend more and more of their me online and adversers follow “I think the compeon then in the next five to ten years is likely to be between Google and Facebook versus Nelix or Amazon Prime, as opposed to Nelix versus the local statebroadcaster,”saysFakela.

Other sectors well posioned for rapid growth include music and video streaming, whose revenue growth by 2026 is expected to outpace tradional TV subscripons in Africa's biggest markets – although TV will remain much larger. In Kenya, for instance, streaming revenue is expected to total $8.8m in 2026, while TV subscripon revenue will total $420m, according to PwC. Similarly, music streaming is the fastest-growing component in Nigeria's music market with the country's arsts, including Burna Boy and Wizkid, topping charts around theworld.

CanAfricaenterthemetaverse?

By contrast, newspapers and magazines are expected to seetheirmarketsharefall.Cinemascouldalsostrugglein the long term, amid rising streaming usage – though box office revenue in South Africa remains strong. For now, cinemas are springing up in cies like Dakar and Nairobi, cateringtoagrowingAfricanmiddleclass.

In the connent's biggest markets, a boost is coming down the track in the form of 5G (fih generaon) mobile data technology, which should usher in cheaper and higher-quality lag-free streaming, cloud gaming and virtual reality South Africa is on the brink of 5G adopon, aer a series of spectrum aucons. Nigeria heldasuccessfulspectrumauconin2021.

“5G is going to play a huge role because I think it will significantly reduce the costs of being connected,” says Fakela.“Iseeitasalsoaneconomicenabler,becauseyou have new businesses coming onstream as a result of faster connecvity, and connecvity in areas that were previouslyunderserved.”

Originalityandauthencitywillbreedsuccess

Those that will succeed in Africa's fragmented media and entertainment industry will be those that give African consumers what they want, rather than repurposing Western content for Africa. Nowhere is that trend clearer than in streaming, where the likes of Nelix, Amazon Prime and Spofy have begun taking Africaseriously.

Today, Nelix offers a vast content library, while Showmax has a slate of African originals and global sports coverage. Disney+ launched in South Africa last May,andhasafootholdinMorocco,Egypt,Algeria,Libya and Tunisia. Amazon Prime Video, meanwhile, launched a local service in Nigeria in August allowing customers to purchase subscripons in Naira, and has established dedicated country teams for Nigeria and South Africa. Similarexpansionhasoccurredinmusicstreaming.

In turn, local companies are receiving record amounts of funding According to Disrupt Africa, African entertainment startups recorded their best ever funding year in 2020, raising $13.9m, mostly from venture capital firms. It comes as streaming signups start to slow downinsaturatedwesternmarkets.

There is sll some way to go, however Streaming giants are sll keen to match their investments to expected returns, Lora-Mungai says, causing African creators to grumble that budgets are sll too low compared to elsewhere.

The bale between streaming giants to boost their African customer bases shows the entertainment and media industry's trajectory, which is being set by the desires of African consumers. With low barriers to entry, consumers have a huge variety of content and services available in their price range. Companies, meanwhile, must bale intense compeon and connual disrupon to stay relevant. For those that do so successfully,thepay-offwillbeenormous.

Science,TechnologyandInnovaon,ICT

The third Senior Experts Dialogue on Science, Technology and Innovaon and the African Transformaon Agenda (SED 2016) ended in Pretoria with experts agreeing African governments need to do more to support innovaon, especially by young people intheirrespecvecountries.

The SED 2016, aended by experts from 21 African countries, including representaves from universies, Member States and cies, sought, among other things, to help African countries idenfy the main opportunies and challenges at different policy and organizaonal levels for leveraging and maximizing the rapid rise of cies, including the rise of mega-cies on the connent todriveinnovaonandinvenon.

The 2016 SED was held under the theme “Cies as InnovaonHubsforAfrica'sTransformaon”.

The three-day meeng, hosted by the Department of Science and Technology (DST) of the Republic of South Africa, idenfied key elements and issues, based on local as well as internaonal experience, that African governments, along with their internaonal development partners, can take into account in formulang acon plans to turn their cies from manufacturing and trade hubs into innovaon hubs and centers.

African cies were already innovave but the sad thing was that governments were sll unable to close the gap betweenwhattheyspendonresearchanddevelopment and the new innovaons that can address some of the problemsfacingAfrica'scies.

There is a lot happening in Africa, so much potenal and untapped sectors that I think we can harness by going into strategic partnership. Africa is on the rise, let's support the young with the right environment and mentorshipthatwillmakeAfricaproud.

By Bright O. Yeboah, Co-Founder of Wi-Flix B.V.