ShowMax website. (Duncan Alfreds, Fin24)
Johannesburg - Local internet video service ShowMax is not increasing its monthly R99 subscription rate despite the weak rand impacting its business.
Multinational media and internet company Naspers [JSE:NPN] launched ShowMax on August 19 last year as a TV series and movie video on demand service.
But the rand has significantly weakened from R12.88 to the US dollar on August 19 2015 to around the R16 mark this week.
ShowMax, like other local television companies, is susceptible to currency movements as it buys its content from markets such as the US.
However, ShowMax spokesperson Richard Boorman told Fin24 that while it is difficult to predict what will happen in the long-term, the company is not planning any subscription price hikes in the short-term, despite the effects of the weak rand.
“As with many other companies and industries, the significantly weaker rand does have an impact on our business plans,” Boorman said in a statement.
“Our focus is on managing that impact and keeping pricing stable. Rand weakness translates into a de-facto price increase by our international rivals, whose services are priced in USD, which has the beneficial impact of making ShowMax better value for money,” he said.
US streaming service Netflix is priced at $7.99 in South Africa, meaning that it’s subscription fee could change month-on-month for South Africans depending on the rand’s movements.
Meanwhile, Naspers-owned satellite pay-TV provider MultiChoice told Fin24 sister publication Channel24.com that it is reviewing its pricing amid the weakening of the exchange rate.
READ: Weak rand spells higher than usual DStv price hike
MultiChoice has increased its prices annually for the last few years. The pay-TV company typically announces its price changes at the end of February and then implements the revised fees in April each year.
*Fin24 is part of Media24 which is owned by Naspers.