Growing opportunities: Niche areas hold promise for new entrants

Although sporadic conflict over the past 15 years has complicated development efforts in Côte d’Ivoire’s media sector, more recently new opportunities for growth in each form of media have emerged. The print media faces serious financial constraints, yet the return to relative stability is set to enable vendors to sell publications to areas previously isolated by fighting, while the expected liberalisation of the state-dominated television sector will stimulate competition and growth in the audio-visual segment. Unexploited niche areas within print and audio-visual media will also likely offer opportunities for new entrants into the market.

PRINT MEDIA: According to the media regulatory body, the National Press Council (Conseil National de la Presse, CNP), Côte d’Ivoire has 25 daily newspapers and 24 weekly publications. The number of newspapers often changes due to the sporadic entrance and exit of publications designed to promote political interests around elections, although 10 to 12 dailies are consistently published. Unlike many countries in sub-Saharan Africa, sales are well charted, giving Côte d’Ivoire’s print sector a boost in terms of transparency, though circulation is more difficult to measure.

Newspaper heavyweights include Fraternité Matin, a state-owned daily established in 1964 following the country’s independence. The daily is the longest-running newspaper and held a monopoly over print media until the liberalisation of the segment in the early 1990s, selling an average of 150,000 copies per day before the entrance of other newspapers. The introduction of competition has eroded the profitability of Fraternité Matin, which now sells 20,000-25,000 newspapers daily. However, the paper was still the best-selling Ivoirian publication in 2012, selling 921,571 copies between July and September 2012, though its sales rate (the number of copies sold out of the total number printed) declined through the year from 69.9% in the first quarter of 2012 to 66.48% in the third quarter. According to the CNP, a decline in sales of 46,250 copies between the first and second quarters of 2012 from 917,515 to 871,265 copies resulted in a loss of CFA9.25m (€13,875). The paper holds a 16% share of sector advertising revenues that, in conjunction with government subsidies, helps to offset large losses, but reflects a wider trend of eroding profitability among Ivoirian newspapers.

COMPETITION: A competitor of Fraternité Matinis the daily Le Temps, which also experienced a drop in its sales rate following the resolution of the conflict in the aftermath of the 2010 elections. Between the first and second quarters of 2012, quarterly sales fell from 926,182 to 816,616, a decline of 109,516 copies representing a loss of CFA21.9m (€32,850). The daily’s sales continued to fall in third-quarter 2012 to 603,321 copies with a 58% sales rate, according to the CNP. However, the paper’s sales in first-half 2012 represents an improvement on the final quarter of 2011, when Le Temps placed seventh in terms of sales with 651,426 copies.

Another popular newspaper is the private daily Soir Info, which also experienced a fall in sales since the end of 2011 when it sold 777,148 copies, ranking it fourth overall. By second-quarter 2012 it sold 581,786 copies, representing a sales rate of 54%, though this improved in the third quarter to 610,185 and 57%.

The subsector of weekly newspapers is largely dominated by three publications in terms of sales: Go copies at an 80% sales rate. The agricultural publication Le Planteur placed fourth in the third quarter, selling 90% of its stock, or 946 copies.

Though the Ivoirian press covers a diversity of subjects, few publications address economic themes, inspiring the launch of Premier Magazine Economique (PME Magazine) in 2003. When it started, press coverage was overly focused on politics with little coverage of the economy, even though the economy was in dire straits and many companies were leaving to work elsewhere in the region. The publication focuses on Ivoirian enterprises and private sector activities. Competition remains limited in terms of economic coverage, and the magazine prints 5000-10,000 copies of each issue every two months. Another publication, Côte d'Ivoire Economie, followed in 2010. Printed at 10,000 copies, it is published monthly and also has online content.

A POLITICISED PRESS: The Ivoirian press is highly politicised, with many of the publications aligned with a political party or candidate. For example, the popular daily Notre Voie is considered to have taken a pro-Laurent Gbagbo stance during the crisis, while the Le President Alassane Dramane Ouattara. The popularity of publications appears to mirror, in part, political dynamics; between fourth-quarter 2011 and fourth-quarter 2012, the number of copies of Notre Voie sold fell from 649,647 to 337,934, where the latter figure represented a sales rate of 42% out of the 799,935 copies delivered. The influence of partisan politics on media creates challenges for journalists and affects the editorial slant. “During the 2011 conflict, journalists working for Fraternité Matin and the state broadcaster were punished or fired if they supported the candidacy of Ouattara, putting journalists in a terrible position,” David Ya, journalist at Fraternité Matin, told OBG.

DISTRIBUTION: The country’s distribution activities are largely handled by Edipresse, a local subsidiary of the French press distributor Presstalis. The company distributes 200,000 copies in 50 cities every day, excluding Sunday, for 22 daily newspapers, 15 weeklies and 100 periodicals. Selling half of its copies at a price of CFA200 (€0.30) per daily newspaper, its average daily sales are valued at CFA20m (€30,000). However, transport costs erode the industry’s profitability.

Although a significant number of newspapers are distributed in Abidjan, transporting papers beyond the commercial capital is a time-consuming and costly venture because of the poor quality of domestic transport infrastructure. “Once transport facilities leave the capital, we begin to lose money from transport costs due to the relatively low sales price of CFA200 (€0.30) per paper. To get all the way to the northern city of Korhogo, Edipresse loses around CFA1m (€1500) per month because we are only paid for papers sold,” Bertrand Holl, director of Edipresse, told OBG.

Moreover, the outbreak of violence in 2011 rendered significant portions of the country inaccessible via road. “Certain regions were completely isolated, and we are unable to transport newspapers to roughly half of the country,” Ya told OBG. Efforts to reconnect interior regions through reconstruction would be complemented by the establishment of printers outside of Abidjan. Print media would also benefit from the usage of more efficient means of transport, such as air travel. “If transport were improved, Fraternité Matin alone could sell over 50,000 copies per day by reaching more readers and by arriving in the interior regions at a decent time, as many locations do not receive their newspapers until 6pm,” Abdoulaye Niang, journalist in charge of external relations at Fraternité Matin, told OBG.

A LIMITED MARKET: While the print media market has a large number of titles, the majority of publications remains generalist, with only one or two devoted to a particular theme such as sports. Subjects that are relatively uncovered include regional economic opportunities, particularly those examining major markets such as energy and agriculture. “There are no regional newspapers yet and this sort of publication would be in high demand, exemplified by the popularity of Jeune Afrique. A regional focus would increase readership potential and issues covering specialist content such as energy could foster links between countries, increasing business connections,” Ya told OBG.

Competition between dailies is fairly intense due to the large number of newspapers in circulation and their often political nature. The country does not have many readers that will read across party lines, and this adds another dimension of difficulty for newspapers. With over 50% of the population living at or below the poverty line, income levels also limit the number of Ivoirians able to buy newspapers. “Many Ivoirian families survive on CFA250 (€0.40) worth of rice per day. When faced with a choice of feeding your family or reading the news, the latter option is naturally not the priority,” Ya told OBG. Poverty also shapes opportunities for education. While youth male and female literacy rates were 72% and 61% in 2010, respectively, the total adult literacy rate as per UNICEF statistics was 55% in the same year, further limiting the number of readers. PRESS “RENTALS”: Newspapers face informal competition from leased papers, whereby a person rents a newspaper to read from a vendor for CFA50-60 (€0. 07-0.09) and returns the paper after he or she is done reading it. “Almost everyone wins: the reader has read the news at a discounted price, while the newspaper vendor can pocket extra money. It is only the newspapers that lose because it is one less newspaper that they could sell,” Holl told OBG. According to Ya, Fraternité Matin estimates that although it sells up to 25,000 copies per day, actual readership figures could be closer to 1m. “Sales rates for a major newspaper like Fraternité Matin are not normal in a country of over 20m people. This means that only 0.2% of the population is buying our newspaper. We must take measures to curb practices like newspaper renting – for example, by wrapping newspapers in plastic,” Niang told OBG.

DECLINING PROFITABILITY: Newspaper prices have been largely fixed at CFA200 (€0.30) since the launch of Fraternité Matin in the 1960s, but publication costs increased following the devaluation of the African franc in 1994. Newspapers of 12-16 pages cost approximately CFA65-80 (€0.10-0.12) per copy for a print run of 10,000 copies, but publications like Fraternité Matin that run 32 pages pay over CFA200 (€0.30) per copy. Given a sales price of CFA200 (€0.30), this often translates into financial losses, with state subsidies helping to make up the difference. Costs for print magazines exceed those for newspapers due to the usage of better-quality paper and colour printing and the relative scarcity of printers producing this type of publication; it can cost as much as CFA3000 (€4.50) to print a 100-page magazine. Financial constraints such as these resulted in at least seven publications withdrawing from the market in 2012, including Notre Heure, Le Pardon, Abidjan24 and Boigny Express.

ACCESS TO CREDIT: Like all firms in Côte d’Ivoire outside of the blue chip segment, press companies face difficulties in accessing bank credit. Large firms pay interest rates of 16-18%, while rates for smaller enterprises are even higher, rendering credit too expensive for the majority of companies. High interest rates are partly a consequence of broader credit opacity, but banks are also deterred by the unprofitability of print media. To facilitate access to credit, in 2009 the government introduced the Press Support and Development Fund (Fond de Soutien et de Développement de la Presse, FSDP). The FSDP provides grants and guaranteed financial aid from banks, firms, organisations and other financial institutions to media companies for training, diffusion, education and counselling, and other activities. Focus has been put on subsidising printing, which can be burdensome for newspapers without printers.

RADIO: Considered the most popular medium, more than 100 radio stations operate in Côte d’Ivoire according to the CNP, including over 40 private non-commercial stations, seven religious broadcasters, four foreign broadcasters and two private commercial stations. Major broadcasters include the state-run Radiodiffusion et Television Ivoirienne (RTI), which operates three public channels: La Chaine Nationale provides general news programming across most of the country, while Frequence 2 offers music and youth programmes to Abidjan, and Radio Bouaké broadcasts generalist programming to Bouaké exclusively.

Following radio’s liberalisation in 1992, radio licences and concessions were distributed to private operators, facilitating the entrance of actors such as Radio Jeune Africain Moderne (JAM) FM, a national private station that covers Abidjan, and Radio Nostalgie, a private FM station launched in 1993 in Abidjan associated with the foreign broadcaster, Nostalgie International. Regional and international participants include Africa No1, an affiliate of the Gabon-based pan-African station that offers a mix of local and regional programming content, and Radio France International and the BBC, which both broadcast nationally but are available in FM from Abidjan, Korhogo and Bouaké. Religious programming has become popular, fostering the rise of stations such as Radio Espoir, an Abidjan-based Catholic broadcaster, and Radio Paix Sanwi, an Aboisso Catholic station.

RADIO VS TV: Nationally, radio is the most utilised form of public media due to its larger coverage area and the affordability of radios, but TV is arguably the most popular media in major urban areas like Abidjan, where the rate of individuals aged 15 years and over that have access to a television was 97% in 2009, compared to an 82% rate for those with access to radio. During the same period, inhabitants of Abidjan within the specified age group watched an average of 182 minutes of television per day, compared with an average of 86 minutes of time spent listening to radio per day.

TELEVISION: Since its inception at independence, the television segment has been monopolised by the state television provider, RTI, which operates two channels. The first channel, RTI 1 or “La Première”, is broadcast nationally with a coverage rate of 70-75% and offers general programming including the news, films and broadcasts in local languages. The second channel, RTI 2 or “TV2”, is a regional channel broadcast in the area around Abidjan that offers youth and cultural programmes. The RTI historically operated a third public channel broadcast from Bouaké, entitled TV Bouaké, but ended broadcasts in the early 2000s due to regional violence. The RTI has since solely operated from its broadcast centre in Abidjan, though the Ministry of Communication aims to reopen the channel.

The broadcast landscape was expanded in 1993 to include a private operator, Société d’Étude et de Développement Audiovisuel en Côte d’Ivoire (SEDACI), which launched broadcasts of the pay-tv channels Canal and Horizons in Abidjan and sold over 7000 subscriptions in the first year. The introduction of new technologies such as digital RDS coupled with cheaper digital decoders has facilitated the expansion of new products and subscribers. By the end of 2012, SEDACI had attracted over 140,000 subscribers with a total of four product packs: Canalsat Access, Canalsat Evasion, Les chaînes Canal+ and Tout Canal. Channel packages vary between CFA5000 (€7.50) and CFA40,000 (€60) per month, which have been designed to allow coverage of much of the population. SEDACI has also an agreement to distribute products of Multi-Choice Africa (MCA-DTSV), a Pay-TV package edited on South African channels. Residents also have the option of satellite providers like Arabsat that broadcast channels from Europe, Asia or the Middle East in analogue or digital.

REGULATORY BODY: Created to replace the former National Council of Audio-visual Communication, the High Authority of Audio-visual Communication (Haute Autorité de la Communication Audiovisuelle, HACA) is the government entity that regulates the audio-visual segment. The HACA sets the standards related to the diffusion and reception of emissions, and was set up to oversee the liberalisation of the audio-visual sector.

LIBERALISATION: In 1990, state authorities began discussing the idea of opening up the audio-visual sector, but television liberalisation was repeatedly postponed due to concerns about the profitability of RTI and the consequences of a lack of control over channel content. Concrete steps were taken in 2012 to initiate the liberalisation process, beginning with the establishment of a commission in July 2012 to evaluate operators bidding for the country’s five private licences to be issued under the first tranche of the programme. According to local media, the president of the HACA, Ibrahim Sy Savané, announced in March 2012 that potential private commercial television operators would be obliged to pay a deposit of CFA1bn (€1.5m) as part of the state liberalisation programme. Private non-commercial television stations will pay a deposit of CFA500m (€750,000), while private commercial and non-commercial radio broadcasters will pay CFA400m (€600,000) and CFA3m (€4500), respectively, though details concerning the identity of bidders were not available at the time of publication. Lucien Agbia, managing director of PME Magazine, told OBG, “The audio-visual segment is currently being reformed, albeit slowly. The government wants to partially liberalise the sector but also maintain a ceiling on the number of channels.”

Having already passed the projected tender launch date of the first half of 2013, information detailing the timeline of the selection process had not been announced at the time of publication. However, sector observers remain concerned that the licence cost may be prohibitive for local actors and prevent them from participating in the tendering process.

Sector actors anticipate the liberalisation process will offer investment opportunities for both local and foreign actors due to the underdevelopment of Ivoirian audio-visual activities. “The quantity and quality of audio-visual content in Côte d’Ivoire will benefit from the increased competition introduced by liberalisation, with enormous potential for investors interested in establishing channels discussing economics, business and regional affairs. These three topics have not been well explored by RTI, but they have become popular subjects to discuss due to the economy-oriented priorities of the new president,” Ya told OBG.

WEB MEDIA: With 968,000 internet users as of December 2011, internet access remains expensive for the average family, costing approximately CFA30,000 (€195) per month for a DSL connection, making online news sites largely inaccessible for the masses. At present, there are only a handful of websites offering news, notably Abidjan.net. Although the local press has not yet been challenged by the rise of online newspapers, efforts are already being made to counter anticipated competition from internet media. Edipresse currently plans to create a website to put Ivoirian newspapers online, enabling subscribers to access newspapers through a reader. “The site would allow people to choose which newspapers they want to read while enabling the Ivoirian diaspora to access these materials. Around 200,000 Ivoirians live in France alone, and they are passionate about events occurring in Côte d’Ivoire, therefore there is an untapped market there,” Holl told OBG.

According to Librairie de France Groupe CEO René Yediety, online purchases will become common in the future, especially as access to the web expands among the population. “There is a bright future for online retailing in Côte d’Ivoire, but for the time being online payments are problematic given piracy issues. Although the lack of addresses is also a challenge, this can be overcome by delivering to formal places such as post offices in remote regions,” he told OBG.

The government is also utilising the internet and social networking sites to engage with the populace and increase efficiency in ministerial communications. Communication through new technologies has been particularly popular among politicians to dispel rumours and react to news or criticism. Speaking to the AFP in November 2012, the youth minister, Alain Lobognon, compared a Facebook or Twitter account to instantly filling a room with 5000 people that will share or retweet a message, enabling as much as 50,000 Ivoirians to access new information instantly. Events such as the Arab Spring and protests in Istanbul have highlighted the utility of social media in terms of information dissemination in frontier and emerging markets, and Côte d’Ivoire is no exception. During the 2011 conflict, Twitter provided citizens with news about the events of the election through the hash tag #CIV2010, while people stranded in their homes by the conflict were able to communicate pressing health needs through the hash tag #CIV social, which helped save 82 people in need of food or medical attention.

OUTLOOK: The Ivoirian media has faced a host of challenges due to the political instability of the last decade. However, the liberalisation of the audio-visual sector and the unexploited niches in economic and regional coverage will offer a range of opportunities for local and foreign investors to enhance and develop the quality and quantity of media coverage available. Going forward, political stability will likely be a boon for print media companies, enabling them to expand their operations.