Nollywood Streaming Showdown: Can Local Streamers Outlast the Streaming Giants?

The Nigerian film industry has long faced distribution challenges, including piracy and limited access to distribution channels. Filmmakers struggled to earn from their content due to these issues. According to filmmaker Imo Umoren, there has consistently been a bottleneck between filmmakers and distributors, limiting the reach of local content and preventing filmmakers from earning adequately from their work. To address the problem, subscription-based platforms were introduced as a solution.

Irokotv emerged as a pioneer in the Nigerian film industry’s subscription-based platform innovation, often compared to the ‘Netflix of Africa.’ With distribution deals and a vast film library, the platform gained popularity and raised $19 million for original content production, to invest in producing 300 hours of original content. The success of Irokotv paved the way for other homegrown platforms like IbakaTv, Afrinolly, and NollyLand. As his early investors made a whopping 3,000% profit on their early investment. Additionally, global streaming giants like Netflix and Amazon entered the Nollywood market, raising concerns about the survival of indigenous streamers.

Netflix’s market penetration

Netflix strategically made its presence felt in Nigeria by acquiring local theatrical releases and collaborating with established filmmakers. This allowed them to produce high-budget local productions and invest approximately $29 million annually in the Nigerian film industry from 2016 to 2022. With their global brand recognition and the ability to showcase local content to a worldwide audience, Netflix became a significant player in Nollywood.

Amazon’s bold entry

Amazon Prime Video entered the Nigerian market by launching Prime Video Naija, a localized version of their service. They employed effective marketing strategies, including affordable subscription plans, a free seven-day trial, and increased investments in local content production. By allowing Nigerian subscribers to pay in naira and reducing the monthly subscription price to N 2,300, Amazon Prime Video quickly gained popularity in the Nigerian market.

In recent years, streaming giants like Netflix and Amazon Prime Video have witnessed steady subscriber growth in Nigeria, as they compete for dominance in the market. Their presence has played a pivotal role in the industry’s expansion. Since 2016, Netflix has invested $23.6 million in over 250 locally-produced, co-produced, and commissioned video content in the Nigerian Nollywood market.

The stiff competition in the steaming industry

The fast-paced changes in Nigeria’s streaming industry have created intense competition for local streamers. In 2020, IrokoTv, which had been the country’s leading movie streaming service for nine years, announced that it was no longer comfortable operating its African operations and decided to scale them down.

While global streamers hold a significant advantage in terms of financial resources and innovation capabilities, some local streamers are adapting to stay competitive by exploring alternative methods to reach their audience. Last year, IBAKATV, for instance, introduced a novel movie distribution system and offered free data to subscribers as a means to sustain their presence in the market.

While the streaming giants currently dominate the Nigerian film industry, the challenges faced by local streamers hold important lessons for them. The Nigerian market presents distinct obstacles, such as rising inflation and high data costs, deterring potential subscribers from maintaining dual subscriptions for data and streaming services. Additionally, piracy remains a concern, with unauthorized distribution of popular films through cheaper yet illegal streaming websites and Telegram groups.

Despite the challenges, Nigeria’s market holds immense growth potential, driven by a large and youthful population that is increasingly interested in streaming content. The key for both local and global streaming companies is to understand the market and effectively meet the needs of consumers. This may involve addressing affordability concerns, forging partnerships, and developing innovative strategies tailored to the Nigerian audience. By adapting to the local landscape, both local streamers and global giants can establish their presence in the thriving Nigerian streaming industry.