Kwese TV Hit by Cash Flow Problems, Misses Payments for World Cup Rights

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Kwese TV Hit by Cash Flow Problems, Misses Payments for World Cup RightsKwese TV Hit by Cash Flow Problems, Misses Payments for World Cup Rights

Pan-African pay-television service provider, Kwese TV, has been hit by a cash crunch, forcing it to default on payments to rights holders to some of the content it seeks to broadcast.

A recent report published by TV Sports Market listed rights holders to whom Kwese TV owes financial obligations to include football’s governing bodies, FIFA and UEFA as well as National Basketball Association (NBA) of the United States of America.

According to the report, Kwese TV has missed out on payment for rights to the 2018 World Cup holding in Russia. It has also delayed in paying to UEFA for the rights to Euro 2020, European qualifiers and the Nations League.

The report added that the pay-television provider has also missed out on payments to ESPN for a package including rights to many US sports properties, use of the ESPN brand name and the creation of bespoke content for an ESPN-branded channel from 2017 to 2024.

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Similarly, payment has not been made to the NBA for exclusive platform-neutral rights to the league from 2016-17 to 2020-21.

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The report quoted senior staff of Kwese as saying they were reasonably optimistic about the funding rounds.

Joseph Hundah, Chief Executive of Kwesé’s parent company, Econet Media, was quoted by TV Sports Markets as saying that building the pay-television company’s portfolio of sports rights had “required more investment than initially forecast”.

“To ensure transparency during this process we have been in continuous communication with our partners who remain extremely supportive and have shown great belief in our business,” Hundah told TVSports Markets.

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The publication quoted a source at one of the rights holder owed money by Kwesé as saying the pan-African pay-television company had variously promised payment in January, February, and March, but did not deliver.

“There’s no change in the relationship though. We do believe the money will come through,” he was quoted as saying.

The slow roll-out of Kwesé’s pay-television operation across sub-Saharan Africa, gradual subscriber growth and its considerable expenditure on rights are believed to be responsible for the serious cash-flow problems. Kwesé is thought to have 120,000 subscribers across the 13 territories in sub-Saharan Africa in which it currently operates.

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Hundah, however, declined to comment on the subscriber numbers, saying: “We are extremely happy with our progress on subscription numbers across our markets considering that we only launched in the last quarter of 2016.”

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A Kwese source told TV Sports market that the company’s future could depend on two rounds of funding, one thought to have been recently concluded, and one to begin in June. Senior members of the company are said to be “optimistic” about the funding rounds.

Rights holders have been promised payment by the end of April, the report reveals and goes further to claim that right holders are ready to give Kwese a chance despite its inability to meet payment deadlines, with the belief the company will eventually come through and meet its commitments.

 

Source: Thisdaylive

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