Orange, which is hard at work on finding ways to win South African consumers, has again veered off its original path - this time the one leading to a paid video-on-demand (VOD) offering.
Orange Horizons MD S'ebastien Crozier says the South African market is "not yet mature enough" for a premium offering, which he believes is the essence of a VOD offer.
"A VOD offering requires a large amount of people to be connected and often requires a 4G connection." He says, while this is something Orange is still interested in offering some day, SA is not geared for it as it stands.
In November, Crozier said Orange would leverage the consumer trend of short-burst consumption, launching short, free videos at first - and afterwards offering premium content at a cost.
When Orange first launched a consumer foray in SA in early 2013, the French telco had ambitions of becoming a fully-fledged mobile virtual network operator (MVNO) - an ambition it put on ice after evaluating the local telecoms landscape.
In April last year, Crozier said Orange would put its MVNO ambition on hold and pursue, among other things, WiFi services. The company has subsequently confirmed it plans to launch an Internet service provider (ISP) in SA this year.
"Once we launch our ISP, we will look at providing VOD services, perhaps in partnership with an existing player in the market." He says Orange does not yet have enough consumer traction on its own to do so.
Meanwhile, Orange is looking into the possibility of launching offers that provide easier access to television channels, "as we did with Orange Radio, where we offer over 12 000 radio stations, we plan to do the same with free videos/TV channels from all over the world".
Elusive success
Africa Analysis analyst Ofentse Mopedi says - for now - SA cannot hope for any miraculous success stories when it comes to VOD.
Altech recently revealed its new VOD offering, the Node, had not been the success it had hoped it would be. The company has been in discussions with content players and is looking for an alternative to its Node product.
Mopedi says SA's VOD market is still very much at its nascent stage. "Notably, MTN's FrontRow only came out of the trial phase about three months ago, while Node was commercialised in the third quarter of 2014."
ICT analyst Adrian Schofield notes, with consumers having grown accustomed to low-cost/free content available from the likes of Netflix and YouTube, interest in the small pool of VOD services South African companies has to offer has been diluted.
Other barriers to take-up, says Schofield, are price, connection and content.
Mopedi says, eventually - perhaps in the next three to five years - VOD products may start to flourish in the local market, "but for now they will continue to contribute very little to the revenues of service providers".
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