Media in Africa is among the fastest growing industries, but the sector has not commanded the level of financing that is required to unlock its full potential. Media expert Parminder Vir, discusses the opportunities in the sector.
What is the investment potential for media and film industries in sub-Saharan Africa?
The media and entertainment industries are registering above average growth in many African countries and are expected to grow at 5% GDP per capita up until 2015. Nigeria, Kenya, Ghana and South Africa offer the greatest opportunities for content producers and distribution platforms for film, television, digital media, mobile and other forms of entertainment. The industry signifies a confluence of creativity and commerce. This creativity has the potential to sustain it when combined with entrepreneurship and professional management. Urbanisation, young demographics, and the expanding and emerging middle-class are the success drivers for the industry and are likely to contribute to its growth in the future.
Despite the continent being an attractive location for filming, not many international production companies are exploiting the opportunity due to various challenges. Tell us about PVL Media Consultants’ initiative to address these issues.
PVL Media is developing a series of events to highlight the sector’s potential to government, business and finance communities. African Media and Entertainment Industry – In the Spotlight is a series of events that explore ways of creating and unlocking value in the sector. The events aim to show media business owners where their companies could be in five to 10 years’ time in terms of growth; how they can make money by effectively utilising multimedia platforms such as film, television, commercials, digital media, mobile, retail, advertising and subscriptions. The series will also look at the role media can play in changing the negative perception of Africa in order to attract new forms of investment from private equity and venture capital firms.
Are private equity/venture capital firms keen to invest in Africa’s media industry?
Over the past year, I have been attending Africa-focused private equity seminars in London to understand why and where firms are investing in Africa. Sadly, the media and entertainment sector is still below their radar as they consider it a risky area. My constant advice to them is to look at other emerging markets such as India, Mexico and Brazil to see the impact of the sector on their respective economies. There is need to raise the sector’s profile and to educate investors on how investment risks can be managed in order to achieve profitable returns. In the last two decades we have been involved in presenting film and media finance workshops in Kenya and Nigeria. We are also working with media business owners in Nigeria to develop strategy and business plans, raise capital investment for Pay-TV channels, build film and television studio facilities, and creating digital cinema networks.
What investment trends can we expect to see in the short-term?
We will see increased investment in infrastructure for film and television studios, local and regional post-production facilities, content distribution on digital multi platforms, and improvement of the quality of local content. We will also see further development of skills and training for the next generation of media producers, writers, directors, technicians and business managers. The opportunities are huge.
Parminder Vir is director at UK-based PVL Media Consultants, a specialist consultancy focusing on emerging markets, media and creative industries.