Amazon Prime laying off staff and will stop producing African content

Amazon Prime, the global streaming giant, is undergoing a significant restructuring, as reported by Variety. The platform, which ranks as the third-largest in Africa, is set to lay off staff and scale back its local content production in Africa and the Middle East. Barry Furlong, Vice President of Prime’s EMEA division, communicated the decision to staff via email, emphasizing a strategic shift towards focusing on the European market, aiming for the highest impact and long-term success. The exact number of affected employees remains undisclosed.

While acclaimed shows like "Ebuka Turns Up Africa" will still be featured, Amazon Prime is discontinuing the approval of local shows in sub-Saharan Africa, the Middle East, and North Africa. The move reflects a realignment of priorities amid the evolving dynamics of the streaming industry.

Africa's streaming market is poised for substantial growth, with projections indicating at least 18 million paying streaming customers by 2029, compared to 8 million customers in the previous year. Netflix and Showmax currently dominate with a combined 75% market share. However, streaming penetration remains relatively low, concentrated mainly in South Africa and Nigeria, with an estimated 7.7% of African households expected to subscribe to at least one streaming platform by 2029.

In 2021, Amazon Prime boasted approximately 575,000 sub-Saharan customers, a figure projected to reach 1.9 million by 2026. The platform initially entered the African market with ambitious goals, hiring substantial staff and forming partnerships with local production studios.

Despite earlier aspirations of becoming the leading streaming platform in Africa, Amazon Prime's recent decision to scale back operations poses a challenge to its initial business model. The platform had established dedicated teams for Nigeria and South Africa, entering partnerships with prominent Nigerian studios such as Anthill, Inkblot, and Greoh.

Prime's pullback also presents a challenge to the emerging trend of tech-focused professionals financing and creating Nollywood movies for international streaming platforms. This model, exemplified by successes like Netflix's 'The Black Book,' has gained traction in the industry.

The broader African streaming landscape has faced challenges, with platforms like Video Play, Telkom One, and Kwese TV shutting down. IrokoTV, Africa's oldest streaming service, reported a significant decline in active users, with CEO Jason Njoku citing a $30 million investment in Nigeria without achieving profitability by the end of 2022. The evolving dynamics underscore the complexities and competitive nature of the streaming industry in the African market.