MultiChoice’s latest annual report has unveiled ten key risks the company is diligently managing to safeguard its business operations, with piracy being a significant concern.
The report highlights that the widespread adoption of broadband internet and declining data costs have led to a surge in piracy across Africa. Many individuals are accessing content illegally through various means, including pirate websites, unauthorised services, and social media platforms.
The issues of illegal retransmission, content piracy, and activities such as file sharing and illegal streaming of sports events pose critical and escalating threats to MultiChoice’s operations. Moreover, the rise of social media and short-form video platforms, including TikTok, has intensified these risks by facilitating the unauthorised sharing of copyrighted materials.
While copyright infringement ranks high among the major risks identified, MultiChoice has also acknowledged several ancillary risks driving piracy. The company employs a comprehensive risk management strategy to address various operational challenges, including shifting macro-economic factors, organisational changes, and a dynamic competitive landscape.
MultiChoice outlined the ten most pressing risks it faces:
- Piracy: The growth of broadband access and lower data costs has led to increased illegal content consumption via pirate sites and services.
- Regulatory and Licensing: Regulatory uncertainties and competition authority risks across Africa continue to pose significant hurdles.
- Negative Macro-Economic Factors: High unemployment, elevated inflation, rising interest rates, political instability, and persistent electricity shortages are stressing local economies.
- Currency Depreciation and Liquidity: Fluctuations and steep depreciation of local currencies, especially in Nigeria, South Africa, Zambia, Ghana, and Angola, impact operational costs.
- Disruption and Competition: The media landscape is competitive and rapidly evolving, with challenges arising from local and global competitors and shifts in viewer behaviour.
- Cybersecurity: It is vital to protect the integrity of its information assets, including customer and employee data. Any breach poses legal and reputational risks.
- Taxation: Increasing tax audits throughout Africa are driven by the need for better revenue generation in struggling economies, leading to often aggressive positions by auditors.
- Talent and Skills Scarcity: To venture into advanced media services, MultiChoice seeks skilled personnel proficient in big data, machine learning, and AI, areas facing a global talent shortage.
- Technology: Continuous technological advancements are crucial to align with strategic goals and enhance the customer experience.
- Impact of Load-Shedding: Ongoing load-shedding in South Africa disrupts subscriber access, leading to increased disconnections as customers cannot access content for extended periods.
Piracy, disruption, competition, and cybersecurity are among these risks, and they specifically highlight the challenges associated with widespread copyright infringement.
MultiChoice is proactively combating this issue through various initiatives, leveraging its cybersecurity firm, Irdeto. Recognised globally for its digital security and content protection expertise, Irdeto plays a pivotal role in MultiChoice’s strategy.
“Besides contributing to revenue and profits, we utilise Irdeto to help mitigate pirate activity throughout Africa,” stated MultiChoice. “Our goal is to significantly reduce piracy levels through a comprehensive strategy that includes technical, legal, and operational responses.”
The company has shifted its focus in the anti-piracy battle from targeting smaller IPTV service resellers to upstream providers in foreign nations facilitating these services. By blocking accounts associated with these operators during high-profile events, such as live sports broadcasts, MultiChoice aims to deter individuals from relying on illegal services.
In the first half of its most recent financial year, MultiChoice reported initiating 233 anti-piracy court cases, demonstrating its commitment to tackling the issue head-on.
