An in-depth look at investment in some of the continent’s most promising entertainment industries reveals areas of growth, challenges and what the future might hold.



Africa’s heartbeat is in rhythm with the passion, culture and creativity of its people. On a continent of 1.4 billion people according to estimates by the United Nations (UN), there are effectively 1.4 billion stories to tell, each one unique and brimming with potential.



The question is: what is the narrative, and who is telling the story? 



Africa’s prospects in creative industries like art, fashion, film and television, crafts and architecture, among others, are well-documented. An oft-quoted fact comes from the United Nations Educational, Scientific and Cultural Organization’s (UNESCO) 2021 report African Film: A Booming Industry. It illustrates the potential in the film and audio-visual industries, which could result in generated revenue of $20 billion per year.



Speaking on the outlook for entertainment and media in Africa over the next few years, Charles Stuart, PricewaterhouseCoopers (PwC) South Africa’s Entertainment and Media Partner, says to FORBES AFRICA:



“We look at consumer spend in terms of what’s covered from a cinema perspective. [It] is growing; it’s just taking longer to recover to where it initially was. Is cinema dead? No, we are not seeing that.”



But where is investment for this forecasted to come from? With the growth of video-on-demand (VOD) and over-the-top (OTT) services, and a burgeoning appetite for authentically African media and content, venture capital (VC) is poised to be at the forefront of development on the continent, for film and television in particular.



<h4 class="wp-block-heading has-text-align-center" id="h-show-me-the-money-jerry-maguire-1996">“Show Me The Money” (Jerry Maguire, 1996)</h4>



The African Private Capital Association (AVCA) indicates that 58 private capital investments, with a total reported value of $346 million, were recorded in Africa’s creative industries over the last decade (2012-2022).



“Starting from a low base of only four investments in 2012, private capital investments in Africa’s creative industries more than tripled, reaching a total of 13 in 2022,” says AVCA.



Notably, VC investments attracted the largest share of these. They accounted for about 67% of the total number over the 2012-2022 period, followed by private equity investments at 33%.



<div class="wp-block-media-text alignwide is-stacked-on-mobile" style="grid-template-columns:36% auto"><figure class="wp-block-media-text__media"><img loading="lazy" decoding="async" width="429" height="522" src="https://cms.forbesafrica.com/wp-content/uploads/2023/08/venture-capital-1.png" alt="" class="wp-image-59059 size-full" srcset="https://cms.forbesafrica.com/wp-content/uploads/2023/08/venture-capital-1.png 429w, https://cms.forbesafrica.com/wp-content/uploads/2023/08/venture-capital-1-247x300.png 247w" sizes="(max-width: 429px) 100vw, 429px" /></figure><div class="wp-block-media-text__content">
<blockquote class="wp-block-quote is-layout-flow wp-block-quote-is-layout-flow">
“WE LOOK AT CONSUMER SPEND IN TERMS OF WHAT’S COVERED FROM A CINEMA PERSPECTIVE. [IT] IS GROWING…
<cite>Charles Stuart, Entertainment and Media Partner, PwC South Africa</cite></blockquote>
</div></div>



“These investments spanned various sectors, including the development of online gaming platforms, music and video streaming developers, operators of music websites, live broadcasting, film streaming platforms, providers of advertising and marketing services, and clothing designers, among others,” says AVCA.



Jeff Schlapinski, Managing Director, Research, at non-profit, independent membership organization, Global Private Capital Association (GPCA), echoes these sentiments. 



“Africa’s VC investments in media and entertainment companies reached $31.2 million across six rounds in 2022, a new record in terms of deal value.”



However, Schlapinski notes that investments into this sector have, historically, represented a very small percentage of investment activity in Africa’s venture ecosystem (~1% of the $2.75 billion invested in VC in Africa in 2022, according to GPCA).



“The significant growth of the venture capital asset class in recent years, along with the increased allocation of capital towards technology or technology-enabled businesses, has contributed to the growth of investments in this sector as well,” says AVCA.



<h4 class="wp-block-heading has-text-align-center">Economies In The Spotlight</h4>



According to AVCA, the increase in the number of investments in Africa’s creative industries strongly indicates investors’ increasing interest and recognition of the sector’s potential. A handful of countries attracted the biggest chunk of that investment over the 10-year period (2012-2022).



“In terms of their geographic distribution, South Africa has attracted the largest share of private capital investments in Africa’s creative industries at 24%.” Following South Africa is Egypt, accounting for 14% of these investments. The country has also emerged as a significant technology hub on the continent in recent years.



“Nigeria and Kenya, two of Africa’s largest private capital markets, have each accounted for 10% of these investments,” says AVCA. Speaking on 2022, in particular, Schlapinski notes that the markets that led VC investments in media and entertainment – in terms of deal value – were South Africa with $22.5 million, Nigeria with $5.7 million and Egypt at $2 million.



They represent three of the four most active countries for overall VC investment with Kenya rounding off the top four.



<h4 class="wp-block-heading has-text-align-center">The Redefinition Of Main ‘Stream’</h4>



Regarding three of sub-Saharan Africa’s emerging economies, namely South Africa, Nigeria and Kenya, streaming service, Netflix, released its Socio-Economic Impact Report earlier this year, where it reveals its impact since entering the market.



Over the 2016–2022 period, it invested $175 million in content and in the overall creative environment in these countries specifically.



South Africa received the bulk of this investment, accounting for at least $125 million. In addition to that, over the same period, it invested in upwards of 425 licensed titles in these economies, further opening up the market to a host of proudly African films and television series.



Expanding on PwC’s outlook for Africa, Stuart says that success for OTTs necessitates an understanding of the type of content you put out there.



“You can have a wonderful distribution platform [but] if you’ve got nothing good to show – which is part of cinemas’ challenges over the last while; some of those big titles and also the lack of big titles has worn out in terms of what we’re seeing.”



He emphasizes the fact that content is always going to be king.



“Coming back to Africa, the culture and the richness and the heritage that we have, if you drive around, you’ve got Shaka [iLembe], there’s Rosemary’s Hitlist (both documentary series) advertised on billboards. You’re seeing the importance of local content to the success of your streaming platforms. Initially, when a Netflix entered Africa, it didn’t do really well. All it was doing is, ‘here’s the international content’. People were familiar with it but we like our African stories as well,” says Stuart.



With streaming platforms, the cost base is mostly fixed, so, in reality, he says that it’s the subscriber base that drives the growth.



“How do you really translate things into profit? It’s getting more people to subscribe to your service. What they were lacking a lot in the early days was this local content – that really resonated with it. What many of the streamers have learned is that it is about finding that balance between your international content, supplemented with your local content. When you look at a lot of the communication coming out of Apple, Netflix, Amazon, there’s continued communication around the fact that they are investing in local content.”



Stuart adds, “There’s still opportunity for your local players but it’s not an easy industry. For every bit of content that ends up on Netflix, there’s probably 10 pieces of content that doesn’t end up on Netflix.”



<h4 class="wp-block-heading has-text-align-center">A Continent Up For The Challenge</h4>



The African Export-Import Bank (Afreximbank) recently took an in-depth look at the continent’s Culture and Creative Industries (CCIs) in its African Trade Report 2022: Leveraging the Power of Culture and Creative Industries for Accelerated Structural Transformation in the AfCFTA Era.



It noted that some of the obstacles hindering the growth of CCIs include policy frameworks, finance, infrastructure, intellectual property rights, standards and norms in the area of cross-border trade, accurate data, language barriers, colonial legacy and an extroverted model.



Furthermore, it states that “a positive outcome of the pandemic has been the necessitated shift to digital solutions and online streaming, which has helped boost the performance and resilience of creative industries underpinned by digital models and platforms”.



While Africa does have its fair share of challenges, PwC’s Africa outlook for 2023-2027, which is expected to be released in September, sheds light on infrastructure investments, particularly in the telco space, which has a fundamental impact on streaming platforms, data consumption, and the growth of mobile gaming on the continent.



<div class="wp-block-media-text alignwide is-stacked-on-mobile" style="grid-template-columns:39% auto"><figure class="wp-block-media-text__media"><img loading="lazy" decoding="async" width="333" height="420" src="https://cms.forbesafrica.com/wp-content/uploads/2023/08/venture-capital-2.jpg" alt="" class="wp-image-59060 size-full" srcset="https://cms.forbesafrica.com/wp-content/uploads/2023/08/venture-capital-2.jpg 333w, https://cms.forbesafrica.com/wp-content/uploads/2023/08/venture-capital-2-238x300.jpg 238w" sizes="(max-width: 333px) 100vw, 333px" /></figure><div class="wp-block-media-text__content">
<blockquote class="wp-block-quote is-layout-flow wp-block-quote-is-layout-flow">
“AFRICA’S VC INVESTMENTS IN MEDIA AND ENTERTAINMENT COMPANIES REACHED $31.2 MILLION ACROSS SIX ROUNDS IN 2022, A NEW RECORD IN TERMS OF DEAL VALUE.”
<cite>—Jeff Schlapinski, Managing Director, Research, GPCA</cite></blockquote>
</div></div>



“For the first time, in this year’s entertainment and media outlook, there’s a telco outlook that has gone with it. One of the aspects that has been covered as part of that telco outlook this year is telco capex spend – how much are the telcos actually looking to spend from a capex perspective in the various markets,” says Stuart.



A glance at the numbers in the assurance, tax and advisory services provider’s Perspectives from the Global Entertainment &amp; Media Outlook 2023–2027: Resetting expectations, refocusing inward and recharging growth for the three aforementioned sub-Saharan African regions seems to indicate an appetite for investment. This includes the convergence of the creative and technology industries.



“When we look at capex spend – and there is some further breakdown in terms of broadband, mobile broadband – in Kenya in 2022, there was $470 million worth of spend in the capex space and that’s going to grow each year at around 2.2%. By 2027, telcos are forecast to be spending around $520 million on their capex infrastructure in Kenya. The vast majority of that – about 85% – is going to be in the mobile space. That probably comes as no surprise given the strong mobile- first characteristics that the market has.”



Stuart adds: “Nigeria is going to be spending more than three times that, so almost $2 billion by 2027. There is a lot of investment in Nigeria. You’ve got your big players – Glo, MTN – they’ve been spending in terms of upgrading the network. They’re already sitting at about



$1.8 billion and it’s going to be a bit above and below that over the forecast period; fairly consistent with that level. Again, the vast majority of that is sitting in the mobile space. South Africa is spending $1.6 billion and that’s actually going to drop a little bit over the forecast period. It makes sense in a way because a lot of the 5G stuff is already in progress. There’s a lot of spend happening at the moment but over time, that does mean it will slow down.”



Data consumption is expected to continue its increase, leaving telcos with solutions to find from an economic and infrastructure perspective. “The challenge that telcos and, particularly, the content providers have is the monetization of that because [it’s] very expensive to upgrade this. There’s obviously downward pressure on data prices but money needed to be spent to upgrade the infrastructure to cater for the increasingly data-heavy world that we live in.



About 80% of data consumption is sitting in the video space, and there are various other categories around communications, music etc. Does it mean that people are watching more than listening to music? Not necessarily. Video [is] just much more heavy from a data usage perspective,” says Stuart.



<h4 class="wp-block-heading has-text-align-center">African, Tech Savvy &amp; Proud</h4>



Another notable point in the report is the impact of the continent’s youth on the growth of the mobile gaming sector.



“The fastest growing segment of video games we’re seeing is in what we call casual and social gaming. That’s your Candy Crush, it’s mobile games that people either play on a free-to-play model or ‘freemium’ where it’s free to start but then you might start paying for things down the line. A lot of that is also funded potentially through advertising that appears in those games so that’s where a lot of that growth is coming from,” says Stuart.



These developments have also opened up an emerging avenue in the cinema space and he adds that this could create opportunities in emerging economies that are primarily tech and mobile-focused.



“Video games are seen as one of the access points to the youth. [They] engage in it and we’re seeing things expanding. During Covid, the Fortnite platform, which people access from a video games’ perspective was used to host music concerts – Travis [Scott], I think, was who appeared on the Fortnite platform and had thousands and thousands of people watching his show, whereas you previously wouldn’t have seen it. There’s a bit of multi- functionality within the video games space.



“What we are seeing in the cinema space is interesting. We’ve always had, traditionally, other sorts of areas like Lego, and then you’ve got Lego: The Movie. We are now starting to see video games that have movie titles and movie franchises attached to them. Why? Because you’ve got this audience that’s already engaged with your content in the video games space and how do you try and stay engaged with them but in a different media format? It could be a series on OTT or it could be an actual big screen film. Maybe that’s some sort of element of opportunity within Kenya and Nigeria – as video games continues to grow, that could help to spur some growth as that content is repackaged into the cinema space,” Stuart concludes.

singer on stage with crowd reaching for him

Where Does Venture Capital Feature In Africa’s Entertainment Sector?

With&nbsp;F9&nbsp;racing past $500 million worldwide and likely looking at an over/under $160 million domestic cume, it would appear that the&nbsp;Fast &amp; Furious&nbsp;sequel is the latest big tentpole (alongside&nbsp;Godzilla Vs. Kong&nbsp;and&nbsp;A Quiet Place part II) to perform about as well as it might have in a non-Covid environment. It’s not an exact match, mind you, as maybe&nbsp;Godzilla Vs. Kong&nbsp;might have earned $115 million (just above&nbsp;Godzilla: King of the Monsters) while&nbsp;Quiet Place 2&nbsp;would have neared the $188 million cume of&nbsp;A Quiet Place, but it’s close enough that we can argue that&nbsp;Black Widow&nbsp;might be in a position to be “judged” on non-Covid standards as it opens this weekend.



So, had it opened in May of 2020 sans a global pandemic as expected, what might we have expected to see? Well, the question is whether the Scarlett Johansson-led MCU prequel would have performed like&nbsp;Doctor Strange&nbsp;or&nbsp;Thor: Ragnarok. Consider this a truncated “pessimistic” and “optimistic” box office preview, the kind of thing I used to do with multiple posts three months out from a big movie’s theatrical release. Anyway, the “pessimistic” look would argue that&nbsp;Black Widow&nbsp;was a prequel set between&nbsp;Civil War&nbsp;and&nbsp;Infinity War&nbsp;featuring a single non-superpowered Avenger who had died in&nbsp;Endgame. Black Widow should have gotten a solo flick years ago, like maybe during the summer of 2017 between&nbsp;Civil War&nbsp;and&nbsp;Infinity War.



That past-due status and Natasha having already sacrificed herself mars the “event movie” nature of this MCU actioner. Ditto the Kate Shortland-directed movie being the MCU film with a solo female director after Patty Jenkins’&nbsp;Wonder Woman,&nbsp;Patty Jenkins’&nbsp;Wonder Woman 1984&nbsp;and Cathy Yan’s&nbsp;Birds of Prey&nbsp;(plus Lexi Alexander’s&nbsp;Punisher War Zone&nbsp;from a pre-MCU era). With no forward narrative momentum and its existence as essentially unfinished business before Phase Four kicks into gear, the MCU brand would do more heavy lifting than usual. Under this scenario, I’d argue an opening weekend between $75 million (Ant-Man and the Wasp) and $88 million (Doctor Strange) and a likely over/under $200 million cume (taking the Disney+ variable into account) for&nbsp;Black Widow.



Conversely, maybe Marvel is Marvel come hell or high water. Black Widow is one of the original Avengers, and her&nbsp;Endgame&nbsp;death may make this more of a curtain call as opposed to what otherwise might have been a palette cleanser between the third&nbsp;Captain America&nbsp;and the third&nbsp;Avengers&nbsp;movie. She may not be as globally popular as Spider-Man or Iron Man, but Black Widow isn’t some newbie being introduced with a conventional origin story. Even absent similar hype levels as&nbsp;Captain Marvel&nbsp;or&nbsp;Black Panther,&nbsp;it would still be the first biggie of the summer back in 2020. That slot which hasn’t yielded an under (inflation-adjusted) opener under $100 million since the first&nbsp;Thor&nbsp;($65 million in 2011/$75 million adjusted).



Under this “Marvel is Marvel, Black Widow is still popular and Scarlett Johansson is still a star” scenario, yeah, an opening on par with&nbsp;Thor: Ragnarok&nbsp;($123 million in 2017 for an eventual $335 million domestic/$854 million worldwide cume) or&nbsp;Spider-Man: Homecoming&nbsp;($116 million/$334 million/$881 million) would be likely. As the first biggie of summer (which can be frontloaded for Marvel… see&nbsp;Civil War&nbsp;and&nbsp;Iron Man 3), we might have expected an over/under $300 million domestic finish. And that would have been just fine for this “stand alone” offering, especially presuming conventional 35/65 domestic/overseas split for a $800 million-plus finish. Heck,&nbsp;Ant-Man 2&nbsp;($216 million domestic and $620 million worldwide)and&nbsp;Doctor Strange&nbsp;($238 million/$677 million)-level grosses would be/will be okay too provided folks like the movie.



So, looking at a Covid curve, and the film being available to lease on Disney+ for $30, we’re still likely looking at a domestic debut between $80 million and $110 million this weekend. It’s possible that the film might have played like&nbsp;Thor 3&nbsp;but will now have to “settle” for playing like&nbsp;Ant-Man 2&nbsp;due to “the current normal,” but I’d argue the above-noted triumphs mean that&nbsp;Black Widow&nbsp;doesn’t have to be graded on that heavy a Covid curve. Whatever&nbsp;Black Widow&nbsp;would have earned domestically in May 2020 (sans Covid but amid a crowded marketplace) may be close to what it earns in July of 2021 (with Covid but seemingly unopposed), give or take repeat business, strong mid-July competition and/or Disney+.



Will Black Widow be the first $100 million-plus domestic opener since Star Wars: The Rise of Skywalker in December of 2019? Will it be the first $200 million-plus domestic grosser since Bad Boys for Life in January of 2020? Back in early 2020, I presumed that F9 would be the year’s biggest global grosser (obviously sans Chinese mega-movies at the time) with Black Widow neck-and-neck worldwide with likely domestic champion Wonder Woman 1984. Now, in mid-2020, I’m guessing F9 will rule the summer (among Hollywood flicks) while Spider-Man: No Way Home has the best shot at ruling the year and being the next $1 billion grosser. As for where Black Widow fits into the great (and slow) theatrical recovery of 2021, well, watch this space.



By Scott Mendelson, Forbes Staff

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‘Black Widow’: Pessimistic And Optimistic Box Office Preview

From Hollywood exports and Grammy artists to award-winning ideas that can save the world, Africa is not only diverse in its people but also in its industries and creativity. For FORBES AFRICA hundredth issue (since the magazine’s inception in 2011), we decided to curate a list celebrating these very ideas, inventions, and influential role models that have spelled Africa’s growth over the last decade.



Having been in the film industry for over 30 years, award-winning South African actor Connie Ferguson is on the list for her impact as an actor, producer, and filmmaker. In 2018, she also graced the cover of FORBES WOMAN AFRICA. She talks to FORBES AFRICA about being included on the icons list.



Correct us if we are wrong but you have had almost 30 years in the acting industry and you have been hugely successful-what/who do you owe your success to?&nbsp; I’ve been in the industry for 31 years now and literally grew up in it and with it! I owe my success to simple perseverance, hard work and never taking anything for granted! Faith and prayer have also been a big part of it! And the people who have believed in me and cheered me on along the way, especially my family, are the reason I never gave up even when times were hard.



 What have been some of your highlights as both an actress and businesswoman?&nbsp; My highlights as an actress are definitely my time at Generations, a show that allowed me the opportunity to build my personal brand, my role as Mavis in Rockville, our debut show as executive producers, and my current role of Harriet Khoza on The Queen. Although the different awards received over the years are humbling and appreciated, the loyal fans and viewers that diligently follow and appreciate my work, are who make it all worthwhile.&nbsp; As a business woman, being the first SA TV personality to launch a perfume in 2008, and a body care range Connie Body Lotion and Connie Men in 2015. Winning the Shoprite Supplier Of The Year Award in 2015 was the cherry on top.&nbsp; Ferguson Films, a production company I own and run with my husband Shona, is also not only a highlight but the biggest blessing! We are able to create work for a hundred plus in a very tough economic climate. All our shows have performed exceedingly well, and we are truly grateful to the people who follow and enjoy our work. They inspire us to keep the creative juices flowing.



 In your opinion what do you think makes an icon?&nbsp; Someone that is not only aspirational but inspirational, that is memorable and leaves a mark wherever they go. 



Can you comment on us at FORBES AFRICA considering you an icon.  I appreciate the honor. I didn’t set out to become an icon. I let my work speak for itself and endeavor to empower and touch as many lives as I can positively. The titles and accolades that come with that are a bonus!



<a href="https://www.forbesafrica.com/cover-story/2021/04/01/the-100th-issue-100-innovations-inventions-icons-from-africa/">For more on the 100 Innovations, Inventions &amp; Icons From Africa (Forbes Africa)</a>



Get the best of Forbes Africa sent straight to your inbox with the latest insights and inspiration from experts across the continent.&nbsp;<a href="http://eepurl.com/cAlInb">Sign up here.</a>

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‘Success is a choice! Rise and grind!’- says Connie Ferguson

TOPLINE Netflix is one of the few companies actually thriving during the coronavirus, hitting an all-time high in the market Thursday after becoming more valuable than rival entertainment giant Disney.



<div class="wp-block-image"><figure class="aligncenter size-large"><img loading="lazy" decoding="async" width="960" height="735" src="https://www.forbesafrica.com/wp-content/uploads/2020/04/Tiger-King.jpg" alt="" class="wp-image-44391" srcset="https://cms.forbesafrica.com/wp-content/uploads/2020/04/Tiger-King.jpg 960w, https://cms.forbesafrica.com/wp-content/uploads/2020/04/Tiger-King-300x230.jpg 300w, https://cms.forbesafrica.com/wp-content/uploads/2020/04/Tiger-King-600x459.jpg 600w, https://cms.forbesafrica.com/wp-content/uploads/2020/04/Tiger-King-768x588.jpg 768w" sizes="(max-width: 960px) 100vw, 960px" /><figcaption>&#8216;Tiger King&#8217; has been a huge boon for Netflix, drawing more than 34 million viewers in its first 10 days on the platform, according to Nielsen. NETFLIX</figcaption></figure></div>



<h2 class="wp-block-heading">KEY FACTS</h2>



The streamer’s stock climbed 5% by midday, after closing at a record price of nearly $427 per share on Wednesday.



With viewers turning to hits like&nbsp;<a href="https://www.forbes.com/sites/arielshapiro/2020/04/08/34-million-people-watched-tiger-king-in-its-first-10-days-on-netflix/#56e0cff52a9a">true-crime documentary&nbsp;Tiger King</a>&nbsp;and comfort-food reruns like&nbsp;The Office&nbsp;and&nbsp;Cheers,&nbsp;<a href="https://www.forbes.com/sites/arielshapiro/2020/03/23/exclusive-disney-sees-huge-subscription-spike-as-homebound-audiences-clamor-for-content/#7f50f02e17c4">Netflix is seeing a spike in new subscriptions</a>, according to streaming analytics firm Antenna.



Aside from increased viewership, Netflix is seeing another benefit from the crisis: like the rest of Hollywood, it has had to halt production, says Lightshed partner and analyst Rich Greenfield, freeing up its cashflow as it accumulates revenue.



What’s good for Netflix is also good for its&nbsp;<a href="https://www.forbes.com/profile/reed-hastings/#73a62bcd2782">cofounder and CEO Reed Hastings</a>&nbsp;— his net worth is now $4.9 billion, a $1.2 billion increase since the end of March.



<h2 class="wp-block-heading">BIG NUMBER</h2>



$194 billion. That is how much Netflix&nbsp;<a href="https://www.forbes.com/companies/netflix">NFLX</a>&nbsp;is now worth, having increased its market value more than $50 billion so far this year. Disney&nbsp;<a href="https://www.forbes.com/companies/walt-disney">DIS</a>, having been hit particularly hard by the coronavirus, is valued below $184 billion, down from nearly $258 billion at the end of 2019. Disney and Netflix are two of the heaviest hitters in entertainment, but they have opposite approaches. While Netflix is entirely dependent on paid subscriptions for revenue, Disney is much more varied, as reliant on tourism and merchandise sales as it is on the content it puts out. While that diversity has traditionally been its strength, it has become a liability as&nbsp;<a href="https://www.forbes.com/sites/arielshapiro/2020/04/14/saving-disney-iger-returns-as-coronavirus-batters-the-company-on-all-sides/#37412867e64f">the pandemic forces Disney to shut down theme parks and delay film releases</a>.



<h2 class="wp-block-heading">WHAT TO WATCH FOR</h2>



While that pause in production may be good for Netflix’s bottom line now, it could result in significantly less new content in the fall than planned. Even so, Netflix may still be better off than its competitors. “The reality is they have much more content in the pipeline than anyone else right now,” says Greenfield.



&#8211;<a href="https://www.forbes.com/sites/arielshapiro/">Ariel Shapiro, </a>Forbes Staff, <a href="https://www.forbes.com/business">Business</a>

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Netflix Stock Hits Record High, Is Now Worth More Than Disney

They’re all closed.



Movie Theaters. Bars. Nightclubs. Arenas. Cafes. In New York, Broadway and museums are shuttered. In San Francisco it’s even more dire. Across the country and the world, cities are shutting down, leaving humans from Seattle to Shanghai without traditional ways of finding distraction.



The mandate for social distancing that has proven essential at slowing the spread of the coronavirus will cut about $12 billion of entertainment revenue from the U.S. if the shutdown lasts until July,&nbsp;<a href="https://www.forbes.com/sites/rachelsandler/2020/03/16/cdc-all-americans-should-avoid-gathering-in-groups-of-more-than-10-people/#255b6cb5283d">as President Trump signaled</a>. Billions more are not being spent on creating new content as film and television production is frozen.&nbsp;



Things could get a lot worse.



“This is definitely unprecedented and turning everyone&#8217;s lives completely upside down,” says Ryan Borba, managing editor at concert tracker Pollstar.



The concert and live event industry brought in $34 billion last year,&nbsp;<a href="https://www.ibisworld.com/united-states/market-research-reports/concert-event-promotion-industry/" target="_blank" rel="noreferrer noopener">according to market research firm IBISWorld</a>. Simple math suggests that a three-month shutdown at this time of year could cost that industry $7 billion of lost revenue. Any longer and it starts to cut into the&nbsp;<a href="https://www.forbes.com/sites/zackomalleygreenburg/2020/03/06/as-coronavirus-cancels-sxsw-coachella-could-be-next-as-music-industry-braces-for-a-cruel-summer/#24e8eb076886">popular summer concert season</a>, which for LiveNation, the world’s biggest concert promoter, is when 70% of its attendance begins passing through the turnstiles. That’s bad news for the producers, songwriters, technicians and the&nbsp;<a href="https://www.ibisworld.com/united-states/market-research-reports/concert-event-promotion-industry/" target="_blank" rel="noreferrer noopener">269,025 concert employees</a>, including janitors, security personnel and ticket collectors. That’s not to mention the world’s&nbsp;<a href="https://www.forbes.com/sites/zackomalleygreenburg/2019/12/06/the-worlds-top-earning-musicians-of-2019/">top-earning musicians</a>, all of whom make the majority of their money performing.&nbsp;



“We’re beginning to see it affect the entire music ecosystem,” one prominent artist manager who <a href="https://www.forbes.com/sites/zackomalleygreenburg/2020/03/06/as-coronavirus-cancels-sxsw-coachella-could-be-next-as-music-industry-braces-for-a-cruel-summer/#20fa6f7d6886">told Forbes</a> on the condition of anonymity. “We’re getting calls from our agents about promoters canceling individual shows. Songwriters and producers have canceled flights into L.A. for sessions, so it’s starting to trickle down to the songwriting and production communities as well.”



On New York’s Broadway, where all 41 theaters are closed, the hit could be about $600 million, based on the amount they pulled in between mid March and July of 2019. During the 2016-2017 season, those theaters also supported more than 87,000 jobs and contributed $12.63 billion to New York City’s economy, according to&nbsp;<a href="https://www.broadwayleague.com/research/research-reports/" target="_blank" rel="noreferrer noopener">Broadway League</a>.



The effect on movie theaters is far more drastic. A complete shutdown across the U.S. will mean a $4 billion hit on the box office if they remain closed until July. On March 18, less than a month into the crisis, the national association of theater owner&nbsp;<a href="https://apnews.com/734c2aad0321b93811a13273c112d21f" target="_blank" rel="noreferrer noopener">requested a bailout</a>&nbsp;from the government.



“From the point of view of studios they are hemorrhaging money on the movie side,” says Mike Bloxham the senior vice president of global media and entertainment at research firm Magid.&nbsp;“There is a lot of money disappearing in China while 70,000 theaters are still closed.”



Once they do reopen, distributors will begin battling to squeeze a large number of films into a limited number of opening dates, including&nbsp;<a href="https://www.forbes.com/sites/maddieberg/2020/03/12/hollywood-braces-for-coronavirus-slump-the-movie-releases-pushed-back-so-far/#3be198ba2bed">some major releases</a>&nbsp;that include the latest&nbsp;James Bond&nbsp;movie, Disney’s&nbsp;Mulan&nbsp;and Marvel’s&nbsp;Black Widow, all of which have been&nbsp;<a href="https://www.forbes.com/sites/maddieberg/2020/03/12/hollywood-braces-for-coronavirus-slump-the-movie-releases-pushed-back-so-far/#ad8a4d02bed6">pushed back</a>.



“No one can precisely predict when public life will return to normal, but it will return,” Patrick Corcoran, the president of the National Association of Theater Owners, said in a statement on Match 17. “When those titles are rescheduled, they will make for an even fuller slate of offerings than normal as they are slotted into an already robust release schedule later in the year.”



Last year, entertainment companies spent $121 billion to create original content and they were expected to spend even more this year as new platforms, like short-form video platform Quibi, emerge and streaming giants like Netflix and Amazon Prime continue to plow through cash to produce new shows that lure in subscribers. Disney, Netflix, Universal and a number of other studios have all but&nbsp;<a href="https://www.forbes.com/sites/maddieberg/2020/03/13/hollywood-studios-disney-netflix-halt-film-and-tv-production-amid-coronavirus/#327ea2195d28">shut down U.S. production</a>. In California alone, that activity supported more than 722,000 jobs and $68 billion in wages, according to the Motion Picture Association of America. In New York City, television and film production support about 10% of total employment, whether directly or indirectly, and generates almost $9 billion each year.



“Right now, we’re working to keep everyone safe, support the industry and find ways to help it come back stronger than ever,” a spokesperson for Mayor’s Office of Media and Entertainment said.



The sentiment mirrored that of Colleen Bell, the executive director of California’s Film Commission who said, “The entertainment production industry in California has overcome challenges in the past, and it will endure this sudden shutdown. Until the COVID-19 situation improves, the focus is rightfully on the public health crisis. After that’s behind us, the industry will once again thrive here in the Golden State.”



While those logistics will reverberate widely across show business sectors, consumers may be in for even bigger, long-lasting changes.&nbsp;



For TV shows, the near-term effects could be disappointing for fans looking forward to fresh episodes of their favorite shows. FX’s&nbsp;Fargo&nbsp;has shut down production and will have to delay new episodes. More series are sure to follow. Streamers have already changed the way we watch TV—introducing binge-watching and slowly eliminating cable subscriptions—and the more that cable and broadcast series are delayed, the more likely we will continue to move away from the appointment viewing of television’s past.



In film, a far more dramatic shift just happened: consumers may no longer need to fight crowds at movie theaters on opening nights. Universal Studios announced Monday that it would begin releasing films like&nbsp;Invisible Man, Emma&nbsp;and&nbsp;The Hunt&nbsp;available for in-home, on-demand rentals despite the fact that these films were only recently released, blowing up the entrenched windowing schedule that gave theater chains exclusive rights to show movies first before they were released to in-flight entertainment, rental platforms and then television. Sony followed, releasing Vin Diesel’s&nbsp;Bloodshot&nbsp;for digital purchase only 11 days after its theatrical release.



Others will likely do same and if they do, it could&nbsp;lead the Academy of Motion Picture Arts and Sciences to&nbsp;<a href="https://www.marketwatch.com/story/oscars-keep-rule-requiring-movies-to-have-theatrical-release-to-be-nominated-2019-04-24" target="_blank" rel="noreferrer noopener">change their theatrical-release&nbsp;</a><a href="https://www.marketwatch.com/story/oscars-keep-rule-requiring-movies-to-have-theatrical-release-to-be-nominated-2019-04-24" target="_blank" rel="noreferrer noopener">rule</a>,&nbsp;which only allows films that open in a theatre and stay there for seven days to be considered for Oscars. It may also prompt Netflix to tighten its grip on the entertainment business with the purchase of a theater chain of its own. In 2018, the streaming giant looked at buying Landmark Theatres, but Cohen Media Group beat Netflix to the arthouse chain.



“If this continues for a long time, that will cause a change in how we consume content and allow newer titles to get to home video much faster,” says Asaf Ashkenazi, the COO of Verimatrix, a technology company that works with distributors in Hollywood. “If it’s a new title, you can delay it, continue to follow the traditional system and just wait. Or you can be more experimental and go directly to selling or renting online, which will allow more people to access it and get the revenue now.“&nbsp;



Other businesses are also turning to streaming, including&nbsp;<a href="https://www.forbes.com/sites/zackomalleygreenburg/2020/03/18/zombie-jamboree-for-a-struggling-livestream-startup-coronavirus-lockdown-offers-one-last-chance/#7811d2e15e24">concert-streamer StageIt</a>. The startup, which offers concerts from the likes of Jon Bon Jovi and Sara Bareilles, is on track to have revenue of $250,000 this week—about the same as its best month until now—and added&nbsp;10,000 subscribers in two days while hosting virtual festival “Shut In &amp; Sing.” Even New York’s Metropolitan Opera is in on it,&nbsp;<a href="https://operawire.com/metropolitan-opera-to-offer-up-nightly-met-opera-streams/" target="_blank" rel="noreferrer noopener">streaming nightly performances</a>.



The stars themselves are also shifting their approach to how they entertain and communicate with fans. “Together, at Home,” a new series of online concerts presented by the World Health Organization (WHO) and Global Citizen, has recruited Chris Martin and John Legend to give casual concerts from their living rooms via Instagram Live, taking requests from fans and singing songs like David Bowie’s “Life on Mars.” Using Instagram, pop star Lizzo led a meditation, Frozen’s Josh Gad read kids a story, and, on Twitter, Yo-Yo Ma played a “<a rel="noreferrer noopener" href="https://twitter.com/YoYo_Ma/status/1238572657278431234" target="_blank">song of comfort.</a>” Entertainers have already <a rel="noreferrer noopener" href="https://www.nytimes.com/2019/10/15/style/celebrity-phone-numbers.html" target="_blank">fully embraced </a>this kind of direct connection with fans and the pandemic may only accelerate that.



&#8211;<a href="https://www.forbes.com/sites/maddieberg/">Madeline Berg</a>, Forbes Staff, <a href="https://www.forbes.com/media">Media</a>

High angle view of audience enjoying comedy movie at cinema hall

Coronavirus Could Be A $12 Billion Hit To Entertainment And Audiences May Never Be The Same

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Technology is changing the entertainment industry so quickly that it’s difficult to predict where the next media fortunes will be made. There is no shortage of entrepreneurs in this field, one of whom is Emma Kaye. Kaye is a leader in African animation and filmmaking. Her credentials are undisputed—she’s the co-founder of Triggerfish Animation Studios, producers of the award-winning Sesame Street and founder of the Sithengi Cinema Festival in Cape Town. But her focus has shifted from producing content for television and film to finding new ways to distribute entertainment content.
The late Steve Jobs epitomized this type of entrepreneur. The introduction of the iPhone was the game changer: Apple sold 128 million handsets earning the company an estimated $76.6 billion. The smartphone fueled the surge in mobile application use, changing the pricing and the distribution of entertainment forever. In 2008, a year after the iPhone’s launch, 18 billion apps were downloaded from the iTunes store earning the company $4.3 billion. Soon after competitors Larry Page and Sergey Brin—the founders of Google, created the Android platform increasing the amount of app content available to cellphone subscribers.
Kaye watched the evolution of mobile devices, then abandoned the old media platforms she’d relied on and immersed herself in new media; first as the CEO of Breakdesign and then as the founder of Gate 7 New Media, a mobile media, entertainment and content company. Under her stewardship, Breakdesign became one of Nokia and Adobe’s top seven global Flash Lite developers.
She was frustrated that there was a lot of generic content to download which had little relevance for Africa. She wondered whether people were downloading this content only because it was available or whether they were demanding it. So she co-founded Mobfest—Africa’s first user-generated mobile content platform. The first channel, Novel Idea, is a text-based mobile entertainment channel featuring serialized fiction—a first in Africa.
But it didn’t ease her frustration—soon, she had started a new mobile app called bozza.mobi.
“I have worked in the mobile industry for a considerable amount of time and during that time, there was a big gap in the market for content that was relevant for an African community. At the same time, there were barriers to media platforms for people who could produce relevant content. Although there was no shortage of content, there were barriers to producing and distributing that content on a mobile platform,” says Kaye.
She decided to conduct a proof of concept in Khayelitsha in Cape Town and Alexandra in Johannesburg, South Africa. She worked with individuals who could produce content but found access to traditional media prohibitive. The feasibility study was launched on MXit using seven minute mobile spec video content. Within three days, there were 40,000 downloads. Three months later, this number had risen to 170,000.
After the successful proof of concept, Kaye secured investments to build a customized mobile application. Aimed at feature phones, with plans to upscale to smartphones, the application features music, videos and poetry from across the continent.
Move over Nigella! Bozza.mobi recently launched Africa’s cooking channel. Users of bozza.mobi have been glued to the popular episode on ‘how to cook a sheep’s head’ in South African townships. In this particular episode, an industrial blowtorch is used to burn the sheep’s hair, turning it into easily removable ash, which is scraped off with a stone or pot scraper. The head is then thrown into a big water tank to wash off the remaining ash. Then it is cut in half, cooked and served to the restaurant’s customers.
For Kaye, bozza.mobi is about access to self-expression. With over 300 artists, filmmakers and poets on its growing database and with new channels being released daily, bozza.mobi offers these individuals and groups a mobile platform through which to distribute their music, films and poetry. Check out the show about a Congolese woman who used a rundown caravan as her hair salon. She uses bozza.mobi to teach hairdressing. By offering tutorials, small businesses can earn revenue—50% of their channel earnings—while users get free access to content.
The provision of free local content has advantages for handset manufactures too. When Nokia was looking to sell their 3250 series in Europe, they asked Kaye for help.
“We worked with Nokia on creating relevant content for a particular demographic in Europe. We created the interface and content relevant for the skateboarding community. It contained video, news tips and travel guides. Because the content was relevant, the Nokia 3250 series phones sold out,” says Kaye.
Handset manufacturers are now embracing local application development as part of their growth strategies. Ericsson ConsumerLab recently found that the emerging app culture in high-growth markets is driving the uptake of mobile devices. The study showed consumers are not buying smartphones for their superior hardware such as the touch screen, memory capacity, attractive design and resolution size, rather, they want app functionality and faster internet access.
For this reason, Samsung is partnering with app developers such as bozza.mobi, which is working on a new version of their application to be released in six months’ time. Samsung is teaching bozza.mobi developers how to develop apps for different platforms. The improved version of bozza.mobi will be rolled out in Nigeria and Kenya. In Nigeria, Kaye has partnered with IT company, Iroko Partners, founded by Jason Chukwuma Njoku. The firm distributes Nollywood movies online—its services have been well received by the diaspora in the States, England, Canada, Germany and Australia.
Due to the fact that apps are becoming an integral part of cellphone users’ daily lives, Kaye says the new version will also serve as a commercial tool to facilitate informal trading in African communities.

Tag: entertainment industry

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