Ac­cess Nol­ly­wood

The Netflix of Nige­ria pre­pares for bat­tle with the stream­ing gi­ant

Bloomberg Businessweek (Asia) - - CONTENTS -

al­ter Tay­laur, a gan­gly, gre­gar­i­ous Nige­rian wri­ter­di­rec­tor, needed a place to shoot his movie, Gbomo

Gbomo Ex­press, a low-bud­get “com­edy-thriller.” In the movie, the head of a mu­sic la­bel hits it off with a so­cialite while out on the town in La­gos. On their way home, three work­ing-class Lagosians kid­nap the cou­ple for ran­som, but the hap­less kid­nap­pers re­al­ize too late that they’re in over their heads.

In Nol­ly­wood, as the Nige­rian movie busi­ness is known, there are no ac­tual stu­dios. Film­mak­ers usu­ally rent an aban­doned or empty man­sion and trans­form it into a set. But Tay­laur hadn’t found one yet. Then a friend came through. He owned a derelict house with ser­vants’ quar­ters in Ebute Metta, a congested neigh­bor­hood in one of the old­est parts of La­gos with faded, peel­ing apart­ment build­ings, pas­tel- col­ored two-level bun­ga­lows, and a sprawl of ope­nair mar­kets. Tay­laur could use it if he wanted, for free. He’d just have to clean it up first. The street out­side might present a prob­lem, though. It was loud: gen­er­a­tors rum­bling, peo­ple shout­ing, horns blar­ing from ve­hi­cles lan­guish­ing in traf­fic. No, Tay­laur said, that sounded per­fect.

When he showed up at the house two days later, Tay­laur had to cut the pad­lock off the gate (his friend had lost the key). In­side, he found rooms knee-deep in trash; it took sev­eral hours—and dump­sters—to get rid of it all. He and the crew gut­ted, cleaned, and painted one space to use as a green­room, adding fans, lights, ta­bles, and mat­tresses for sound­proof­ing. They also built sets that passed for an of­fice and a hos­pi­tal suite. When they be­gan film­ing, they left the street noise in.

Tay­laur shot the movie on dig­i­tal video for less than 10 mil­lion naira, or about $53,000, over 18 days in Jan­uary 2015. “There’s a lot of free­dom, and you can make any­thing hap­pen, and peo­ple do,” Tay­laur says of Nol­ly­wood. It’s a “do-or-die” trade, where pro­duc­tions shoot any­where they want, pro­vided they have the right fixer, and turn lo­gis­ti­cal chal­lenges into plot twists.

Gbomo Gbomo Ex­press came out in the­aters last Oc­to­ber, and then—a first for Tay­laur—on an In­ter­net stream­ing ser­vice called IrokoTV in Jan­uary. Founded in 2011 by Ja­son Njoku,

a 35-year-old Nige­rian-Bri­tish en­tre­pre­neur, Iroko Part­ners op­er­ates the ser­vice and has amassed a cat­a­log of sev­eral thou­sand Nol­ly­wood films, most in English, but some in Yoruba. Start­ing in 2013, Iroko be­gan pro­duc­ing its own orig­i­nal con­tent, mak­ing it the West African an­swer to Netflix. It of­fers Africans, on the con­ti­nent and in the di­as­pora, a way to watch Nol­ly­wood fare wher­ever they find them­selves. Af­ter In­dia’s Bol­ly­wood, Nol­ly­wood is now the world’s se­cond-busiest movie in­dus­try, crank­ing out 1,000 ti­tles per year. Other hits on Iroko in­clude Mrs. Some­body, House of Gold, and 30 Days in At­lanta, a com­edy in which the pro­tag­o­nist wins an all-ex­penses-paid hol­i­day to Amer­ica and brings his cousin.

Njoku and his part­ner, Bas­tian Got­ter, launched Iroko af­ter rais­ing $3 mil­lion in an ini­tial fi­nanc­ing round from New York hedge fund Tiger Global Man­age­ment and Swedish in­vest­ment firm Kin­nevik. They later raised an ad­di­tional $5 mil­lion. (The com­pany won’t dis­close how many sub­scribers it has, but the num­ber is es­ti­mated to be around 65,000.) Iroko says it’s now one of the largest fun­ders, co-pro­duc­ers, and com­mis­sion­ers of con­tent in Nol­ly­wood. The ques­tion on many minds, how­ever, is whether Iroko has built up enough of a lead: Netflix it­self an­nounced early this year that it wants to be­come a global In­ter­net TV net­work and in­tends to ex­pand into Africa, though it hasn’t said when. Al­though Netflix has no spe­cific plans for Nige­ria yet, the coun­try would have to be near the top of any list the com­pany’s drawn up. (The Kenya Film Clas­si­fi­ca­tion Board has al­ready called Netflix a po­ten­tial threat to “moral val­ues and na­tional se­cu­rity.”) Iroko has been the only com­pany of its kind on the con­ti­nent, sur­viv­ing while sim­i­lar ven­tures have failed, but is it ready for se­ri­ous com­pe­ti­tion?

When Njoku’s ir­rev­er­ent cul­ture mag­a­zine, Brash, closed in

Manch­ester, Eng­land, in 2008, he had a backup plan—sev­eral, ac­tu­ally. He started an event-man­age­ment com­pany, set up his own T-shirt brand, con­sulted for night­clubs hop­ing to break into the Manch­ester stu­dent mar­ket, and ran graphic de­sign and Web de­vel­op­ment out­fits. “What else did I do?” he asks him­self on a re­cent af­ter­noon in La­gos, try­ing to re­call. Oh right, he al­most for­got, the blog net­work he op­er­ated in his spare time. “I al­ways had two or three projects go­ing at the same time.” Af­ter none of them re­ally worked out, he de­camped to Lon­don in 2009, where he’d been raised by his mother in a state-run coun­cil flat. With a chem­istry de­gree from the Univer­sity of Manch­ester on his ré­sumé, he re­luc­tantly took a job with a mar­ket in­tel­li­gence firm, only to quit not long af­ter be­cause it was “in­cred­i­bly bor­ing.”

Liv­ing back at home, dis­cour­aged and rest­less, he found in­spi­ra­tion for his next hus­tle in an un­likely place: his mother’s movie-view­ing habits. “She went from watch­ing typ­i­cal soap op­eras to Nol­ly­wood movies,” he says. “That my mother could sit in front of them for three hours straight was pretty re­mark­able. Here’s some­one who had Sky, satel­lite tele­vi­sion, but chose th­ese movies.” The films weren’t of great qual­ity. “Peo­ple were shout­ing, and the pro­duc­tion val­ues were low,” Njoku says. Still, the movies had a cer­tain ap­peal. The fan­tas­ti­cal sto­ries, com­bin­ing fa­mil­iar fam­ily drama with el­e­ments of the su­per­nat­u­ral, were far more en­ter­tain­ing than a church ser­vice, but just as morally in­struc­tional and virtue-ori­ented. They of­fered an es­cape from your own prob­lem­atic life into the sala­cious trou­bles and scan­dals of out­ra­geous char­ac­ters, with­out the as­so­ci­ated shame. When Njoku went to the shops and hair sa­lons in the neigh­bor­hood where he grew up, Nol­ly­wood movies were al­ways on, and their au­di­ences were al­ways cap­ti­vated.

“What’s usu­ally pop­u­lar are the rom-coms for the cinema, and in the straight-to-home video mar­ket and

DVDs, there’s usu­ally a lot of voodoo and witch­craft,” says Tay­laur, the

Gbomo Gbomo Ex­press di­rec­tor. He orig­i­nally in­tended to make a film noir but was afraid the con­cept would go over most view­ers’ heads; he in­jected slap­stick to make it more palat­able to the Nol­ly­wood mar­ket. Tay­laur and other film­mak­ers aim to please their au­di­ence with a steady diet of hu­mor, ro­mance, be­trayal, and spir­i­tual re­demp­tion.

“I would never have dis­cov­ered that [Nol­ly­wood films have a de­voted fol­low­ing] if I hadn’t moved back in with my mother be­cause I was broke, ba­si­cally,” Njoku says. In early 2010 he got on a plane to La­gos, the first time he’d been to Nige­ria as an adult. “I had noth­ing to lose. I came to try and ex­plore the movie in­dus­try here.” He ven­tured to the in­fa­mous Alaba Mar­ket, a maze­like bazaar where ven­dors buy Nol­ly­wood ti­tles from “mar­keters,” deal­ers who may have also fi­nanced the films they sell. The movies even­tu­ally end up in the hands of hawk­ers sell­ing them on Nige­rian streets, in other mar­kets, in suit­cases headed to other coun­tries, or on YouTube, the eas­i­est way to watch them abroad.

Be­cause no Nol­ly­wood pro­duc­tion house con­trols a ma­jor share of the movies, it was eas­ier for Njoku to en­ter the mar­ket and dis­rupt it. He charmed his way into per­sonal re­la­tion­ships with the traders and used some cash from his old friend and part­ner Got­ter to pay in the low hun­dreds of dol­lars for each of the 200 ti­tles he ac­quired. He then up­loaded the films to YouTube, call­ing the chan­nel Nol­ly­woodLove. He and Got­ter say they ended up mak­ing $1.2 mil­lion in gross rev­enue dur­ing 2011. Hulu was big at the time, and a model of sorts. But Njoku wanted more. He wanted to con­trol the viewer’s to­tal ex­pe­ri­ence.

Nige­rian sub­scribers pay a monthly fee of 500 naira, about $2.50; for them, the bulk of the cost of watch­ing Iroko is paid to car­ri­ers for the data they use while stream­ing. In­ter­net ac­cess is ex­pen­sive in Africa, though prices are grad­u­ally fall­ing. Cus­tomers com­plain that “Iroko is eat­ing all our data,” even though their money is go­ing to their tele­com providers, not the stream­ing ser­vice. Iroko has re­sponded by of­fer­ing down­loads, which take up less data than stream­ing, for its films; it pro­vides lowqual­ity down­loads as an­other data-sav­ing op­tion. As a sub­sti­tute for In­ter­net stream­ing, many in Nige­ria have at least one or two movies on their smart­phone they share via phone-to-phone file-trans­fer apps such as Xen­der. Iroko is also look­ing to link up with tele­com com­pa­nies to of­fer users a dis­count on their data use while watch­ing movies and TV shows. Its view­er­ship is over­whelm­ingly from the di­as­pora, a pro­por­tion Njoku wants to change.

Nol­ly­wood, the se­cond-largest em­ployer in Nige­ria, makes

up 11 per­cent of the coun­try’s nonoil ex­ports. The in­dus­try is known for its guer­rilla ap­proach. In the early 1990s mostly self-taught film­mak­ers, lack­ing fi­nanc­ing or pro­duc­tion stu­dios, shot movies on video cam­eras over the span of a week, usu­ally for less than $20,000. Low pro­duc­tion val­ues be­came part of their charm.

The love of Nol­ly­wood films around Africa, says Adi NdukaAgwu, Iroko’s head of busi­ness de­vel­op­ment, has guided the com­pany’s growth strat­egy. She works at a long ta­ble, one of sev­eral in Iroko’s three-story, pur­ple-walled La­gos head­quar­ters, where graphic de­sign­ers, video edi­tors, and other em­ploy­ees spend their day scru­ti­niz­ing large-screen com­put­ers. The com­pany also has of­fices in New York and Lon­don, but, Nduka-Agwu says, “we can grow our cus­tomer base a lot faster and a lot big­ger here in Africa.” Iroko’s cus­tomers want love sto­ries, come­dies, and melo­dra­mas, says Tope Lu­cas, the com­pany’s head of con­tent ac­qui­si­tion. The com­pany seeks out pop­u­lar films for its plat­form, but it also re­ceives sub­mis­sions from film­mak­ers. Prospec­tive ti­tles are then sent to the Lon­don of­fice, where an­other team watches movies all day and rates them by pic­ture and sound qual­ity, sto­ry­line, star power, and buzz. Lu­cas also rig­or­ously checks viewer com­ments to see what they like, or don’t like, about each film—and re­quests for other films they want on Iroko.

Nige­ria has weak copy­right pro­tec­tion, so boot­legged DVDs are ram­pant. That’s Nol­ly­wood’s big­gest headache. Pi­rated DVDs are sold along­side le­gal ones at Alaba. Even when Iroko buys ex­clu­sive rights to films, it has to trawl con­tent-shar­ing web­sites such as YouTube to make sure no other copies are on­line. If they are, Iroko has them taken down. At the be­gin­ning, the com­pany had to take down

a lot of copies, Lu­cas says. Iroko spends more money for its ti­tles to per­suade film­mak­ers to come to it in­stead of re­leas­ing DVDs (which are eas­ier for pi­rates to copy) and to se­cure ex­clu­sives.

Tay­laur and other film­mak­ers are prag­matic about piracy, milk­ing it for free pub­lic­ity as long as they can make back their in­vest­ment. Films re­leased to the­aters move on an ab­bre­vi­ated sched­ule, pushed from cin­e­mas to DStv, Africa’s satel­lite TV net­work, or a plat­form like Iroko within a few months be­fore ev­ery­one gets a pi­rated DVD. Iroko is “very good, be­cause they’re buy­ing con­tent,” Tay­laur says. For a three-year li­cense, he says, fel­low film­mak­ers are paid from $3,000 to $5,000, with an op­por­tu­nity to rene­go­ti­ate if the film does well. It’s not great, but it’s some­thing.

Iroko be­gan as a freemium plat­form, mean­ing 90 per­cent of t he con­tent was f ree, with heavy ad­ver­tis­ing. The model ended up be­ing not very prof­itable and un­pleas­ant for users be­cause of all the ads; it was killed in 2014. Cus­tomers would have to ac­cept pay­ing for con­tent. “Here, it’s much more fig­ur­ing out—based on the data that peo­ple have and can af­ford, based on when they have ac­cess to the In­ter­net and how much they will truly be watch­ing—how much are they will­ing to pay,” Nduka-Agwu says.

Iroko be­gan charg­ing a sub­scrip­tion fee and added a mo­bile app. It’s try­ing to make its plat­form as sim­ple as pos­si­ble for sub­scribers, who are mostly in La­gos, Abuja, Port Har­court, and other big cities. “Data still feels so un­af­ford­able, and the in­fra­struc­ture in this coun­try is gen­uinely un­re­li­able and ex­pen­sive,” Nduka-Agwu says. “There’s a shift that needs to hap­pen. We need to con­vince more and more peo­ple that it’s [af­ford­able].” The mo­bile app was stream­lined with ad­just­ments, let­ting users log on with their phone num­ber in­stead of forc­ing them to come up with a unique user­name. The com­pany is con­sid­er­ing do­ing away with pass­words al­to­gether.

In 2013, Iroko started its own in-house pro­duc­tion with ROK Stu­dios, which has re­leased movies and vi­ral TV shows like Hus­bands of La­gos and Des­per­ate House­girls. It wanted to con­trol the qual­ity of its con­tent and to cap­i­tal­ize on the ad­dic­tive na­ture of se­ries, with short episodes suited to mo­bile phone view­ing. Iroko still posts free movies heavy on mys­ti­cism and tra­di­tional val­ues—it calls them “vil­lage movies”—with ad­ver­tise­ments on YouTube chan­nels, which it says at­tracted more than 300 mil­lion views last year and drew new cus­tomers.

Shortly af­ter Netflix’s an­nounce­ment in Jan­uary, Iroko re­vealed it had closed on $19 mil­lion in deals from in­vestors, in­clud­ing French me­dia com­pany Canal Plus, to pro­duce orig­i­nal con­tent and ex­pand through­out the con­ti­nent. The new in­vestors no­ticed the com­pany had made “sig­nif­i­cant gains in con­tent pro­duc­tion and dis­tri­bu­tion,” Njoku says. De­spite that vote of con­fi­dence, “there are no other prof­its,” he says. “None,” he re­peats, laugh­ing. He says he hopes to be­come “cash-flow pos­i­tive” this year.

Iroko be­lieves that, as a niche ser­vice for an au­di­ence that prefers Nige­rian films, it can with­stand the en­try of a big­ger com­pany into its mar­ket. For Nol­ly­wood fans, Iroko will likely re­main the most com­pre­hen­sive data­base for the near fu­ture. For view­ers in­ter­ested in both Nol­ly­wood and for­eign-made en­ter­tain­ment, their loy­al­ties may be di­vided. Netflix, too, won’t have it easy. “Stream­ing in this coun­try is a very dif­fi­cult thing. It’s get­ting bet­ter, but it’s not good,” Nduka-Agwu says of Nige­ria. She al­lows that the stream­ing gi­ant may have one ad­van­tage: It “can part­ner with ev­ery In­ter­net ser­vice provider.”

Crit­ics won­der how long the money-los­ing com­pany can sur­vive on ven­ture cap­i­tal funds. With no plans to raise the sub­scrip­tion price, Iroko would have to dras­ti­cally in­crease its cus­tomer base—and soon—to stay afloat. Njoku re­mains op­ti­mistic.

“We’re break­ing ground that hasn’t been bro­ken be­fore,” he says. See­ing Iroko as a long game, he’s plan­ning ac­cord­ingly: dub­bing films in French, and soon lo­cal lan­guages across the con­ti­nent like Swahili and Zulu, to reach tens of mil­lions of Africans. The out­come won’t be de­ter­mined sim­ply by bud­get, but taste as well. “This story could re­ally only take place in Nol­ly­wood, in Nige­ria, by a Nige­rian who saw some­thing which a lot of peo­ple over­looked,” Njoku says. “It was like I was com­ing from the fu­ture.” <BW>

Tay­laur (left) and Njoku (right)

Scenes from the La­gos set of Walk­ing Away, a film from ROK Stu­dios and Di­vine Touch Pro­duc­tions

GBOMO EXPRE GBOMO SS

THE REAL DEAL

DES­PER­ATE HOUSE­GIRLS

Newspapers in English

Newspapers from Australia

© PressReader. All rights reserved.