MultiChoice brings Sh15b to Kenyan economy

September 29, 2015
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MultiChoice had a direct contribution worth Sh3.1 billion, which was measured by the sum of its profits, wages and taxes paid in Kenya.
MultiChoice had a direct contribution worth Sh3.1 billion, which was measured by the sum of its profits, wages and taxes paid in Kenya.

, NAIROBI, Kenya, Sept 29 – MultiChoice is estimated to have contributed Sh15.8 billion to the Kenyan economy in 2014, according to a report launched by Deloitte Tuesday.

The estimates were drawn from the impact of MultiChoice’s own activities in the country, the impact of procurement of goods and services in its supply chain and associated ripple effects through the economy.

Broken down, MultiChoice had a direct contribution worth Sh3.1 billion, which was measured by the sum of its profits, wages and taxes paid in Kenya.
“This direct impact is largely due to the tax revenue that MultiChoice’s activities generate for the Kenyan government,” Mark William an Economic Consultant at Deloitte said.

In the 2013/14 financial year, the company contributed a total of Sh2.2 billion in taxes, while it paid wages that amounted to Sh.747.5 million in the same period which according to Deloitte, was more than three times of what was paid in 2011.

Apart from direct impact, MultiChoice also made an impact through spending. According to Deloitte, the company spent an aggregate of Sh.6.9 billion in generating local content, technology and distribution, marketing and administration suppliers among others, marking an almost sevenfold increment on expenditure between 2011 and 2014.
MultiChoice also spent Sh2.5 billon which is 37 percent of its total expenditure on technology and distribution marking growth in the segment due to the digital switchover.

Deloitte also said that MultiChoice had a multiplier impact on the country’s GDP.

“MultiChoice’s Kenyan suppliers, whether local content producers or technology service providers, spend part of the income received from the company with Kenyan supplier in order to provide their services. As such the income initially spent by MultiChoice is further spent across the economy by employees, suppliers, the exchanger or KBC as a shareholder, producing ripple effects and further economic activity in Kenya,” William said.

Additionally, MultiChoice paid dividends to Kenya Broadcasting Corporation (KBC) worth Sh.189.5 million.

And that’s not all; Deloitte has documented MultiChoice’s impact in Kenya including its spillover contribution.

According to the report, the company has facilitated and encouraged the digital migration process in various ways, sentiments echoed by the Director General of Communication Authority of Kenya, Francis Wangusi.

“MultiChoice played a key role during the digital migration process. It did so by generating public awareness about the process and supported the switchover by being among the players that provided set-top boxes readily,” Wangusi said.

MultiChoice has hence imported an estimated 1.5 million set-top boxes and spent almost Sh52.6 million on generating awareness on the migration.

Wangusi also urged Kenyans to take advantage of the opportunities that ICT has to give.

“ICT is an important segment in Kenya’s GDP contributing 13.5 percent into the sector. I urge players in the industry to take advantage of this.”

As MultiChoice marked its twentieth anniversary, the company’s Chairman Waithaka Waihenya said that the company was determined on getting more local content on its platform.

Since 2011, MultiChoice has produced, commissioned and licensed more than 45 shows in Kenya and commissioned 116 local films.

“We want to do more. We shall therefore be taking our Maisha Magic channel and split it into three; Maisha Kenya which will have local content including some in vernacular languages, Maisha Bongo for Tanzanian viewers and Maisha Uganda for the Ugandan audience.”

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