The Evolution of Technology and Media in Nigeria
It is no news that the media and technology sectors greatly evolve year after year but more significantly after the Covid-19 pandemic year (2020) which resulted in a shift in the trends adopted worldwide. Upon the incited discoveries of employment opportunities in these sectors such as, the exponential increase in the demand of information technology (IT) services fueled by the excessive Increase in the demand of smartphones, availability, and accessibility of the internet, and the trend of online retail markets which has resulted in an increase in the modern concept of virtual businesses, these sectors are on their way to be ranked as the top revenue-generating industries in Nigeria second to oil and gas as these have turned out to become highly profitable ventures.
Many indigenous companies have started earning high revenues by providing various IT services including developing new apps, development of programs to enhance online payment methods, online transactions, and customer experience. IT provides an immense business opportunity for investors as most of the private businesses, government agencies, and other organizations are looking forward to getting their transactions automated. Another benefit that the foreign IT companies can enjoy is the availability of young, talented and skilled manpower. As stated by Obi Asika in his article, he expressed rightly that the advent of technology and new media brought about a market disruption in Nigeria, creating significant opportunities for players in these industries that have and still are producing Nigerian success stories.
One of such stories is that of Paystack, a giant amongst the over two hundred financial technology (fintech) companies in Nigeria. This initiative greatly revolutionized Nigerian businesses by better equipping them for online commercialization. The natural response for them was to leverage on popular streams of media to drive traffic to their online businesses by means of online advertising and content creation. Since its acquisition by Stripe, Paystack has relaunched its ecommerce store for sole entrepreneurs and small businesses, updated a feature for subscription-based businesses to better track customer cards that are about to expire, and has become a preferred payment option for vendors. Another industry giant worthy of recognition in terms of growth is Nollywood.
Nigeria’s media scene is one of the liveliest in Africa and a keynote contributor to this is Nollywood, Nigeria’s resilient and omnipresent film industry. It has become a global powerhouse with an enormous following in Africa and among the African diasporas. Shooting movies has a huge impact on the locations in which they are filmed. As crews descend on a location, they bring in hefty streams of revenue for businesses in the area. Filming directly generates revenue for a destination through spending on accommodation, transportation, equipment, local labor, and fees and taxes. Statistics express that, Nollywood is the second-largest film sector globally with a projected worth of $6.4 billion in 2021, and the continent’s largest in terms of value, number of annual films, revenue, and popularity. Nigeria produces around 2,500 films annually.
The importance of Nollywood to the Nigerian economy, noted Steve Omanufeme in a 2016 International Monetary Fund (IMF) report as highlighted by Business Day , “was only fully realized when the Nigerian GDP was rebased in 2014”. The sectors captured in the rebasing exercise were arts, entertainment, and recreation; financial institutions and insurance; real estate, professional, scientific, and technical services; administrative and support services; public administration, education, human health, and social services; and other services—these had previously not been included in GDP at all. “Among the segments included for the first time”, noted the report, “were Nollywood, the information technology sector, the music industry, online sales, and telecommunications. As a result of this rebasing exercise, Nigeria’s GDP in 2013 jumped from an initial estimate of $285.5 billion to $510 billion”.
It was reported by the Premium times, that the federal government of Nigeria is finalizing work on the Motion Picture Council of Nigeria (MOPICON) Bill to create a proper regulatory environment for the sub-sector of the creative industry. In addition to this statement made by the Minister of Information Mr. Lai Mohammed at the opening of the 2019 Africa International Film Festival (AFRIFF), he further disclosed that the government would establish the Endowment Fund for the Arts to create a legal framework for the financing of the creative industry.
For any investor, the technology and media sectors in Nigeria are filled with several opportunities to be explored. Over the years, Moore Bishop & Rooks has had the privilege of partnering with new entrants and existing organizations in these sectors, both locally and internationally.
This article was written by Shalom Ndulaka of the Lagos office of MOORE Bishop & Rooks.