* "Nollywood" is world's second-largest film industry
* Investors seek access to industry's content, audience
* African states offer "rare" pay-TV growth opportunity
By Alexis Akwagyiram
LAGOS, Sept 10 (Reuters) - "Oya!" shouts the director in
Nigerian Pidgin English. Actors take their marks. Lighting
blinks on. The film crew snaps into action after the order to
hurry up.
It's another day in Nollywood, the affectionate nickname for
Nigeria's film industry - the world's second most prolific after
India's Bollywood, producing hundreds of films and TV episodes
each month.
For decades it was a factory churning out visual pulp
fiction destined for the market stalls of DVD pirates. But
Nollywood is increasingly grabbing the attention - and financing
- of global entertainment brands.
Some, like French group Vivendi's VIV.PA Canal+, seek to
harness Nigerian hustle and know-how to extend the lifespan of
the traditional pay-TV model, which is bleeding customers in
developed markets but still has a future in Africa.
Others, including South Africa's MultiChoice MCGJ.J , are
using Nigeria as a testing ground for introducing streaming
platforms in African markets with poor communications
infrastructure and low income levels.
In both cases, it's local production that's benefiting.
"Ten years ago Nollywood was very different," Mary Njoku,
whose ROK studios was acquired by Canal+ in July, told Reuters
as the film crew worked in an abandoned hotel in Nigeria's
megacity Lagos. "Today we shoot with better cameras... We do
things differently."
A room on the hotel's top floor was standing in for a
college dorm on "What Are Friends For?", an ROK comedy series
that will be among new shows aired by Canal+ in coming months.
The company first dipped its toe into Africa's most populous
country six years ago, buying up local films, dubbing them and
airing them on a dedicated channel, Nollywood TV, to viewers in
French-speaking Africa.
That success led to the creation of a second channel.
The deal with ROK secures a steady supply of new films and
series as the firm eyes a further expansion of African content,
said Fabrice Faux, Canal+ International's chief content officer.
Since it was founded six years ago, ROK has produced more
than 540 films and 25 series. Under the Canal+ deal, Njoku says
it aims to increase production from next year to around 300
films and 20 series annually.
Canal+'s pivot to Africa - a golden opportunity for ROK - is
a business necessity for the French company.
"It is one of the very rare pay-TV markets that is growing
and is growing very fast," Faux told Reuters. "When I joined
Canal+ International back in 2014, we had half a million
(African subscribers) and now we have 4 million."
Compare that to mainland France where, as of last year, it
had lost some 1.3 million individual subscribers since
2013. Much of that decline arose from losing broadcasting rights
to popular sporting events. But it also reflected stiff
competition from streaming services such as Netflix NFLX.O and
Amazon AMZN.O . However, Faux believes such rivals pose no
threat in Africa due to a widespread lack of 4G coverage or
fixed broadband internet on the continent.
To properly develop African markets, however, Canal+ must
cater to their diverse audiences, Faux said.
Francophone Africa has no Nollywood equivalent. Producing
shows there has been slow and expensive, as Canal+ has been
forced to bring in film crews from Europe to shoot on location,
Faux said. He now hopes Canal+ can use ROK to clone the
Nollywood model.
"The best knowledge and expertise is there in Nigeria. So it
is our intention to try to bring some producers, technicians,
directors to French-speaking Africa, for us to try to develop
new production methods," Faux said.
TEMPORARY GLITCHES?
If Canal+ sees little threat from streaming services in
Africa, MultiChoice - the first major entertainment group to
realise Nollywood's potential - is out to prove it wrong.
In its infancy in the 1990s, Nollywood churned out cheap
films ranging from bawdy comedies to morality tales about
witchcraft and infidelity.
Low on production quality but high on entertainment value,
these movies quickly garnered a fanatical following across
Africa and its diaspora. And in 2003, MultiChoice launched
Africa Magic - a Nollywood channel that would grow into a
subscription package on its DStv satellite network.
In July, Showmax, MultiChoice's fledgling video-streaming
service, launched in Nigeria.
"The Nollywood phenomenon makes it quite interesting from a
content development point of view. You have a huge base of very
loyal fans," said Niclas Ekdahl, CEO of MultiChoice's connected
video division.
Showmax - also available in South Africa and Kenya - is not
alone in Nigeria's video-on-demand market.
U.S. streaming giant Netflix released "Lionheart", its first
original film produced in Nigeria, in January. It is also
negotiating licence deals for Nigerian films such as "Chief
Daddy", a comedy that debuted on the platform in March.
But bringing streaming to African audiences won't be easy.
Expensive mobile data and low incomes make regular streaming
unaffordable for many on the continent.
One gigabyte of data, enough to watch about three films,
costs the equivalent of around $2.80 in Nigeria, while most
people live on less than $2 a day.
The experience of Malaysian streaming platform iflix is a
cautionary tale.
It launched in Nigeria in 2017, then expanded to Kenya,
Ghana and Zimbabwe following a tie-up with Kwese TV, a
subsidiary of Zimbabwe's Econet Media Limited.
However, data discounts and a pay-as-you-go option were not
enough to sustain the business. In December, iflix sold its
Africa business to the Econet group, which shut down the
streaming service last month.
Showmax's Ekdahl remains undaunted, passing the challenges
off as "temporary glitches". The potential payoff - a largely
untapped audience of 1 billion - is worth the effort of
tailoring a business to African markets, he believes.
Showmax partnered with mobile phone operators Vodacom
VODJ.J , MTN MTNJ.J and Telkom TKGJ.J in South Africa and
Safaricom SCOM.NR in Kenya to offer reduced data and
subscription fees. It aims to do the same in Nigeria.
It is also experimenting with installing wireless internet
in public transport, so viewers can download content during
their daily commutes without incurring data costs.
The boom in interest in Nigeria's film industry can only be
a good thing, says Joshua Richard, a barrel-chested actor who
plays a fanatically religious student on "What Are Friends For?"
Foreign investment will, he hopes, help Nollywood shake off
a reputation for shoddy camerawork and muffled sound, while also
leading to greater artistic recognition overseas.
"It exposes African actors to a bigger audience," he said.
"We have lots of good content in Nollywood, but it doesn't get
the credit it deserves."