Africa Media Management (AMM) and its AfricaXP Channel bouquet addresses content packaging and trading issues in Africa with a game changing business model and a cloud based channel delivery platform. They call it AXP 1.0.As a TV content producer or distributor, selling content to TV channels across Africa is rather frustrating: over 50 countries with over 500 FTA TV channels, mostly with small budgets. Travel costs are high but prices are low and volumes are often small. Content delivery is also difficult and costly, which all means low return on investment. Craig Kelly, CEO of AfricaXP, has developed a number of solutions to some of the most pressing challenges for African producers and international content distributors alike. Balancing Act's analyst Sylvain B letre talks to him about his model that and how it could help change the industry.
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Amongst African media commentators generally and at industry events such as DISCOP Africa, there have been many references to the need for a new leader, a kind of game changer who will bring solutions to the market and facilitate the development of the industry to the level it needs and deserves to be.
Among industry experts, there has not been much agreement as to the timing of this great event: nobody knows when it will happen. So while international investors and major media companies eye Africa as the last great frontier, they are also wary, as they are in fact not sure how to capitalize on this huge opportunity.
While the industry hopes and waits, most African producers are struggling. It's no easy feat trying to cobble together sufficient funds to produce programmes from art grants, social development funding and occasional small commissions from FTA channels. As the demand from upcoming DTT platforms or new alternative distributors like VoD platforms keeps growing, African producers don't have content on the shelf to meet this demand, nor can the prices being offered fund new production on a single sale. So producers cry out for more - more grants, more commissions, more local content quotas, more Dollars per hour. They want broadcasters to make them viable.
The trouble is most broadcasters have challenges of their own. Problems like the fact that they need to invest significantly to be able to migrate to new broadcast technologies like DTT and IPTV - while advertising is famously slow to move to new media platforms even when they have proven audiences. Then they must fill the new channels this technology offers with compelling content. While engaging with this, they simultaneously need to buy or produce better programming to maintain their audience share in increasingly competitive and more complicated broadcast markets. In short broadcasters need more and better content, but at lower cost per hour, precisely while producers demand higher fees for content as they simply can't improve quality on the rates presently being paid.
So both parties need the other to move in the opposite direction - clearly the model is broken and so far, nobody has come up with the right fix.
When I started watching this sector 5 years ago, I got quite frustrated by the lack of information available on this market and the lack of a common voice to help solve the pressing problems with content distribution. The picture is slightly different today: I get plenty of industry articles each day; DISCOP Africa, the MIPTV of Africa allows content buyers and sellers to meet up once a year; DTT and Broadband internet access are being rolled out, digital technology is more affordable; there are several African film festivals in place across the world; South African blockbusters and Nollywood films cross oceans and billions have been invested in the industry. We are at a turning point but the sector is still missing something.
Experienced independent pan African television producer, Craig Kelly recognised some years ago, that one of the key reasons for the failure of the African production industry to expand sufficiently was the lack of a content market of any scale in every country except Nigeria. He says As an independent producer I couldn't find buyers easily: the commissioning process at bigger broadcasters is heavily relationship dependent, while other smaller broadcasters couldn't pay enough on their own to cover production costs. I needed to find a way to sell to multiple broadcasters simultaneously and with one transaction and content distribution cost. So he quit production and went into distribution to address one of the sector's key challenges: the African broadcast markets extreme fragmentation.
Not surprisingly, Nigeria's Nollywood proved to be Kelly's inspiration to find a new model more suited to the digital age. Nollywood had been growing rapidly around its unique content market and VCD/DVD distribution network and it was based on the commercial model we know best in Africa: farming. You grow or create your product and sell it in the market immediately - then reinvest in more product with the proceeds, making some profit in each cycle.
AfricaXP's new commercial model recognizes that the industry needs a Nollywood inspired system for the whole continent, but one that also needs to cross boarders and that recognizes that the age of DVDs is rapidly passing us by. It must enable distribution worldwide and into new content delivery platform of all technology, shapes and sizes. It must also be adaptable to various new commercial models like revenue share and pay per view.
Above: a broadcast control room (Globecast).
Content distribution has become a full time occupation - it's no longer a trip to the market on a Wednesday morning for a quick one-to-one cash transaction. To some extent we need to be more like the music industry and collect royalties from multiple broadcast platforms on an ong
