Television GBS: The right time, the right place
There is a buzz building in Ghana about a new pay TV service promising to launch soon, unlocking premium satellite-based TV to a potentially huge new market.
But who is behind GBS, and why has the time come for mass-market pay TV?
GBS is the vision of Julian McIntyre, one of the founders of Gateway Communications. Founded back in 2000, Gateway is now one of Africa’s largest international communications networks. And with coverage over 37 countries across the continent, Gateway has built the largest pan-African communications network.
As an infrastructure provider, the company is rarely in public view, but it underpins much of the communications and trade in Africa:
• Gateway’s clients include over 80 mobile and fixed line telecommunications operators and 1,200 corporate customers including Barclays, Celtel, Coca-cola, ExxonMobil, MTN, P&G, Shell and Unilever.
• Well over 20% of all African satellite cellular backhaul services are carried over the Gateways network
• The chances are that if you are making or receiving international calls or data communications in Africa, then the service is delivered over Gateway’s network.
• More recently Gateway acquired GS Telecom, a provider of data connectivity services to corporate customers and telecommunication operators in Africa.
Gateway is an African success story. The company has invested over $250 million in the continent and with its innovation and dedication has helped to bring 21st Century communications infrastructure to Africa. Just last week it announced a further investment of over $35m in expanding it’s next generation network (NGN) in West Africa.
Gateway recognised the opportunity to provide high quality mobile services to an otherwise underserved market and has successfully implemented a powerful business model to suit the market. The company’s commitment to Africa has been steadfast and Gateway firmly believes in reinvesting back into Africa to carve out a progressive and sustainable future.
But what has all this got to do with television?
Following Gateway Communications’ success, McIntyre decided that there has never been a better time to invest in Africa and invest in TV.
Investment in African media is rare – according to the BBC World Service Trusts’ African Media Development Initiative, in Ghana “The television sector, perhaps due to its capital-intensive nature, has experienced the least growth.”.
What is even more unusual and exciting is that the market niche that’s been identified by GBS is not the wealthy, not those who already have access to pay TV. Julian McIntyre’s vision through GBS is to offer premium pay TV at a very affordable price, making the service accessible to all Africans.
Lack of investment and competition artificially constrains the market. It leaves consumers with very little choice and very high prices for services which people in other parts of the world long ago ceased to consider luxuries – instead they have become life’s basics.
How can this be achieved? GBS is coming at the market with a new model and a significant investment. GBS sees 1.6 million TVs in Ghana, but only 10,000 subscribe to a satellite service. While others might look at those figures and assume that only those 10,000 can afford pay TV, GBS has a totally different perspective.
The story is not unlike mobile telephones – and GBS’s heritage in Gateway Communications has many lessons here. If people value a service and if it’s priced like a utility, not a luxury, then it will become part of their everyday lives. That is why GBS will be priced like a utility. But what about a service that people value? GBS is investing millions of dollars into premium content that will give people the choice and quality of world class programming.
The time is right. Consumer electronics, satellite broadcasting, payment mechanisms, premium content, consumers who demand more – all of these essential elements for a good quality, accessible pay TV service in Africa have come within reach.
The time has come for people to start enjoying services like GBS. This market is ripe for growth, and the only barrier now is unaffordable pricing.
Gartner, a leading UK-based research company, has estimated that a more affordable entrant onto the scene could drive growth of over 30 per cent per year in the penetration of pay TV. The market could be worth $3bn by 2015. This is good news for not only viewers, but for entire industries that are related to pay TV. Potential dealers, installers, call centre employees, shopkeepers will all have the opportunity to join the TV revolution in Africa!