The Billion Dollar Industry of Nollywood Still Undervalued

- October 01, 2017

The richest man in #Nollywood, Jason Chukwuma Njoku, Co-founder and CEO of iROKOtv, started what is now the largest Video-on-Demand (VOD) platform in Africa in his bedroom without any office in 2010. A #YouTube channel, he simply called "NollywoodLove", when he was flat broke before his fellow college buddy, Bastian Gotter he met at the University of Manchester invested US$150,000 for a 50% stake of iROKOtv in 2010.

Now popularly called, "Netflix of Africa", iROKOtv attracted foreign investors to raise US$21 million in 2013 through New York based VC, Tiger Global, Sweden-based Kinnevik and US-based Rise Capital.
Today iROKOtv is the world’s largest online distributor of African content with a library of over 5,000 Nollywood movies and watched in more than 178 countries in the world by over one million unique monthly subscribers on smart phones, tablets and smart TVs and in 2016 launched two linear TV channels, Rok on Sky UK and Rok on DStv Africa.

Nollywood has made Njoku a multimillionaire and celebrated in FORBES.

iROKOtv and other competitors in the VOD market of Nollywood are making more money than the other film distributors in the Nigerian film industry estimated to be worth more than ₦853.9 billion (US$2.1 billion) by current exchange rates.
The second biggest money spinners are the cable TVs, followed by the few cinema chains with less than 200 screens in some cities in the most populous country and largest economy in Africa.
The general consensus is that the cinemas are not enough. The cinemas made almost US$12 million in 2016 and can make a thousand times more with a thousand more cinemas which can be located in the hundreds of towns in Nigeria. Nigerian movies only made 30% of the total revenue from the box office.
Nollywood makes peanuts when compared to Hollywood.
The Motion Picture Association of America’s (MPAA) Theatrical Market Statistics for 2016, U.S. and Canadian box office was US$11.4 billion and the global revenues amounted to more than US$38.6 billion in 2016.

The few cinemas in the country can even make more than what they make from the box office if the operators and owners are maximizing the full potentials of their cinemas. But they are only limited to the revenues from the box office and the concession stands.

Owing and operating cinemas in Nigeria cost more, because they run on generators until midnight and include the price of building the cinema or paying rent, utilities, equipment and maintenance, getting the movies and paying salaries. That is why the owners are often in debt and owing banks for their loans. That is why I don't envy them. debts bring embarrassments.

Nollywood is losing billions of naira, because the major film distributors have ignored the huge global movie merchandising industry that made more than US$251.7 billion in 2015 according to a 2016 study by the International Licensing Industry Merchandisers' Association.

I have seen several Nollywood movies that would have made millions of dollars from movie merchandise. But both the filmmakers and film distributors were totally clueless about these highly profitable spinoffs.

Millions of movie goers love souvenirs from their favourite hit movies.

The following are hit movies that made astonishing revenues from sales of movie merchandise.

Star Wars' franchise for toys has made US$12 billion so far.
Pixar's "Cars" franchise generated US$10 billion in global merchandise sales.
"Despicable Me 2" made $970 million worldwide—almost double the original's gross return ($543 million)
Marketing movies: Merchandise that rakes in the cash
https://www.cnbc.com/2015/06/18/andise-that-rakes-in-the-cash.html?view=slideshow&%24DEVICE%24=native-android-mobile.

~ By Ekenyerengozi Michael Chima, Publisher/Editor of the NOLLYWOOD MIRROR®Series

Amazon.com: Michael Chima Ekenyerengozi: Books, Biography, Blog, Audiobooks, Kindle
https://www.amazon.com/author/ekenyerengozimichaelchima.

RECOMMENDED BOOKS ON NOLLYWOOD
NOLLYWOOD MIRROR®Series Books 1 and 2.