Is Netflix Exiting Nollywood?

However, filmmakers and insiders are telling a different story. According to veteran filmmaker Kunle Afolayan, Netflix canceled several Nigerian originals in the works. Afolayan was speaking at a panel during the 2024 Zuma International Film Festival in the capital city of Abuja, and he shared that seasons two and three of his film-turned-TV series, Anikulapo, were saved from being axed because production had wrapped on the project.

"Thank God we [had] shot seasons two and three because all the other people commissioned [at] the same time with us, the projects were canceled," Afolayan said. While the filmmaker's statement doesn't expressly say that Netflix is exiting Nigeria, the news of these cancellations points to the possibility that the streamer could be scaling down its investment in local originals. Netflix has yet to address the claims about canceled projects.

The potential scaling back of Netflix's investment in Nollywood threatens to have far-reaching consequences for the Nigerian film industry. Beyond content availability, the reduction poses significant economic challenges for filmmakers and creative professionals across the sector. This situation mirrors broader challenges in the African entertainment market, where international platforms have struggled to sustain long-term commitments. This trend threatens the livelihoods of countless individuals in the Nigerian film industry - from directors and actors to crew members, technicians, and support staff who depend on these productions for their survival.

Earlier this year, Prime Video announced it was cutting funding for African originals and would not be greenlighting any new originals soon. Jade Osiberu's upcomingChristmas in Lagos is the only commissioned film to survive the axe.

Afolayan's statement also coincides with the exit of film executive David Karanja as the licensing manager for Netflix originals for Sub-Saharan Africa. "While the world is beginning to recognize the power of African voices and stories told by Africans, I believe we are on the brink of a watershed moment for African cinema and television, similar to the leaps we've seen in music," Karanja wrote on LinkedIn earlier this week. Karanja's optimistic stance echoes similar sentiments shared by Nomsa Philiso, CEO of general entertainment at MultiChoice, back in September.

These optimistic stances now seem increasingly uncertain. Media entrepreneur David Adeleke points out that Netflix's claim of not exiting Nigeria isn't very reassuring. "Some projects that had received up to 80% funding were informed they would be shelved," Adeleke tells OkayAfrica, adding that he's spoken to some of the filmmakers whose projects were canceled.

Many social media reactions to Afolayan's statement that Netflix canceled several Nigerian originals centered on economic considerations. According to a 2023 report by Business Day, Nigeria accounts for less than 11 percent of Netflix subscribers in Sub-Saharan Africa. South Africa holds 78 percent of the subscriber base despite having less than half of Nigeria's population.

That same report put the number of Netflix subscribers in Nigeria at 169,000. Since then, Netflix has implemented two subscription price increases, escalating the premium plan from N4,400 ($2.60) to N7,000 ($4). While pricing has remained stable since Netflix's 2018 market entry, the naira's value has worsened drastically over the past year and a half.

Considering the battering effects of inflation in Nigeria, the 60 percent price increase makes it hard to forecast an increase in Netflix's subscriber base over the past year. Netflix's revenue from Nigeria makes it hard for the streamer to justify continued long-term, multi-million dollar investments.

"Due to the disparity in the amount of investments going into the industry and what they're getting out of it, they're cutting down their investments," Adeleke says. "That means there are higher bars for commissioning originals, and we can expect they will pay less on average for originals and commission fewer originals."

The potential reduction of these international investments could fundamentally reshape Nollywood, giving filmmakers fewer distribution and exit routes. With cinema distribution tightly controlled and inflation reducing audience spending, filmmakers are facing an unprecedented challenge. "Inflation means fewer people are spending money at cinemas," Adeleke explains. "Filmmakers cannot spend much money on films and expect significant returns."

According to Adeleke, Netflix had reduced its activity as far back as April or May. And while no one can confirm that the streamer is leaving the market altogether, what's clear is a significant reduction in commitment that could have long-lasting consequences for Nigerian cinema.

"It is obvious that the reactions to the rumors prompted Netflix to put out a statement denying its exit ... However, industry insiders say that Netflix reduced its activity in the industry as far back as April or May. We can't say for sure that Netflix is leaving the market, but what is sure is that they have cut down activity significantly."