Increased Internet access to spur consumer spending in South Africa, survey says

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Broader Internet access will generate more consumer spending than any other media product or service in the next five years in South Africa’s entertainment and media industry, according to a new report.

The report, by PricewaterhouseCoopers, said growth in Internet access will also drive revenue growth in Nigeria and Kenya. South Africa is Africa’s second-largest telecom market after Nigeria by investment and subscription.

The report, released Thursday, said combined revenue from Internet access and Internet advertising will account for an estimated 71.6 billion South African rand in consumer spending (over $65 billion) in 2018. Growth in South Africa’s entertainment and media industry is largely being driven by the Internet and consumers’ love of new technology, in particular mobile devices such as smartphones and tablets.

The report also predicts that sharp growth will be seen in video games, largely due to the popularity of mobile gaming.

“Growth in the South African entertainment and media industry is largely being driven by Internet and new technology,” said Vicki Myburgh, entertainment and media industries leader for PricewaterhouseCoopers South Africa. “Technology is increasingly being driven by consumers’ needs and expectations.”

The report said Nigeria’s entertainment and media revenue will reach an estimated $8.5 billion in 2018, more than doubling from the 2013 figure of $4 billion. According to the report, the growth in Nigeria represents one of the fastest growth rates in the world for entertainment and media. The number of Internet subscribers in Nigeria is expected to surge from 7.7 million in 2013 to 50.4 million in 2018.

In East Africa, the report said Kenya recorded $1.7 billion in entertainment and media revenue in 2013, but that revenue is expected to rise to $3.1 billion in 2018. Once again, it is Internet access that is driving the growth, according to the report.

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