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Last month, Channels were still looking for suitable studio space in London, so that part of the UK channel’s output can be produced in the UK. For now, Sky channel 575 will take its UK feed from the Nigerian channel.
Momoh confirmed that Channels will be hiring staff in the UK, perhaps as many as 15, to fill back-office positions. But much of the technical work will be outsourced.
The business model is simple, but ambitious. “Our product is free-to-air. Pay TV has never taken off in Nigeria. But I prefer to make it free, to invest in it and then attract the advertising. That’s worked well for us in Nigeria.”
But, the “build it and they will come” model has a lot of upfront costs. According to Momoh, it costs around US$1mn per year to be on the Sky platform and when you add up the other capital expenditure, the cost is around US$1.5mn.
Momoh says they can meet this cost because of previous success in Nigeria. “We run a good business in Nigeria. We have invested some of our revenues back into the industry outside Nigeria.
“It’s like a gamble that we have taken. For me it’s something like déjà vu because that’s how Channels TV started. No one gave us a chance at the outset, but we proved them wrong,” he says. Momoh projects that, conservatively, it will take three years for Channels’ UK operations to break even. “The strategy is to get most of our revenues from Nigeria and then encourage people to advertise locally in the UK.
“We are not going to be UK- dependent in the first instance. The advertising revenues will originate from Nigeria, and I think we should have enough funds to keep ourselves running from Nigeria.
“For those who want to advertise their products in the UK and Europe, particularly the airlines, the telcos, the banks – as well as the education sector that is particularly strong – the Nigeria package will include UK exposure for an affordable additional fee,” he explains.
If Channels can make its UK and German ventures work, then the Momohs will likely set their sights further afield. In fact, the channel is available in many places thanks to internet protocol television (IPTV). Channels already has a loyal following in the US.
He is driven by a love of journalism. “I like to think I am impacting people by being giving them information, [enabling them] to have a political voice for themselves. We can start by expanding further into Africa and make Channels TV international, with a different perspective to the news that is covered around the world,” John Momoh says.
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