Dialog Axiata teams with Netflix in Sri Lanka; FY18 data sales surge

28 May 2019

Sri Lankan fixed and mobile provider Dialog Axiata has signed a partnership agreement with over-the-top (OTT) online entertainment service Netflix, enabling Dialog post-paid mobile subscribers to add their Netflix subscription fee to their monthly mobile bill. In announcing the tie-up, the two firms said the new arrangement will offer users ‘unparalleled convenience and security’ and remove the need for them to share any additional payment details such as their credit card or debit card numbers. Further, Dialog Axiata says that to support the move it is offering users a free 5GB data bundle per month to watch the OTT provider’s content.

The news comes as Dialog Axiata confirms it managed to stem the fall in voice revenue in FY 2018 while data sales rose strongly. In its annual report filing, group chief executive Supun Weerasinghe noted: ‘While local voice revenues remained stable, the emerging segments of mobile broadband, fixed and digital services contributed significantly to the overall profile.’ Indeed, the operator’s full-year results confirm that mobile broadband revenue rose 32% year-on-year in 2018, while sales derived from fixed and digital services grew 29%. The CEO went on to point out that Dialog’s revenue growth combined with its focus on operational improvements led to group EBITDA improving 28% y-o-y to LKR43.5 billion (USD247.8 million) for FY18, while the EBITDA margin edged up to 39.8%.

Dialog Axiata’s annual report suggested that despite the threat from OTT services such as WhatsApp, its voice revenue experienced only a ‘moderate decline’ of 1% in 2018 from the year before, and that new customer acquisitions from ‘aggressive regional campaigns and successful new product launches’ helped to support voice revenue over the year. Nevertheless, data is the future and in the year under review Dialog Axiata continued its strong growth momentum during the year to record 32% y-o-y growth in data revenues driven by increased ‘smartphone penetration, 4G device penetration supported by rapid 4G conversion, coverage expansion and upgrades to data related infrastructure’. The mobile arm closed out 31 December 2018 with 13.8 million mobile subscribers, up 8% from the previous year.

Sri Lanka, Dialog Axiata