Cough up for our content: SABC

Commercial deal with MultiChoice sought for screening SABC1, 2, 3

20 June 2021 - 00:11 By Caiphus Kgosana
Picture: REUTERS/SIPHIWE SIBEKO
Picture: REUTERS/SIPHIWE SIBEKO

Africa's biggest pay-TV operator, MultiChoice, might have to part with millions of rands if it is to continue offering the three SABC channels it has carried for free on its DStv platform since 2008.

Broadcasting regulator Icasa has published draft regulations that support the continuation of "must-carry" rules, but under a new commercial agreement that could lead to MultiChoice paying the public broadcaster to continue offering the SABC1, 2 and 3 channels on DStv.

MultiChoice is fighting back, saying the must-carry rules exist to promote universal access to public broadcasting and that the SABC makes about R500m a year in advertising by having its channels on the DStv platform.

The Electronic Communications Act of 2005 prescribed public broadcasting as a must-carry service by subscription broadcasters, but "subject to commercially negotiable terms".

However, when Icasa published initial must-carry regulations in 2008, the phrase "subject to commercially negotiable terms" was left out. That allowed MultiChoice to show the three SABC channels without the need to enter a carriage agreement with the public broadcaster.

Commercial interests of the public broadcaster are paramount
Gugu Ntuli, The SABC group executive for corporate affairs

The regulator has now published amended draft regulations to remedy the omission. In the draft regulations, Icasa decrees that must-carry regulations must continue to be necessary and relevant in a digital broadcasting environment until such time that all audiences are guaranteed universal access to public broadcasting services (PBS).

It amended one regulation to include the following: "The PBS licensee [SABC] must offer its television programmes, subject to commercially agreeable terms, to an SBS licensee [subscription broadcasters] upon request.

"The purpose of this regulation is to do away with the old regulation compelling the PBS [SABC] to offer its television programmes to SBS at no cost."

This is a huge win for the SABC. The draft regulations propose that a commercial agreement be entered into 90 days after the regulations come into effect. If not, the broadcasters could be fined R1m.

Gugu Ntuli, SABC group executive for corporate affairs, said Icasa's regulations should have been done 13 years ago, allowing the SABC to commercially negotiate carriage fees for its channels. The fees, she said, were an internationally recognised revenue source for free-to-air broadcasters.

Ntuli said it was unfortunate that MultiChoice had sought to portray the SABC as "purely having commercial motivations" to enforce a commercial agreement.

She said the SABC wanted the law to be applied correctly. "The SABC believes that protecting the commercial interests of the public broadcaster is of paramount importance."

The SABC accused MultiChoice of seeking to continue the current arrangement because having the three SABC channels on DStv was convenient for its customers.

In its submission to the government's draft white paper on audio and audiovisual content services that seeks to scrap must-carry rules, MultiChoice accused the SABC of seeking an end to must-carry regulations for "purely commercial" reasons.

It said the arrangement was beneficial to the SABC, which generated an extra R560m in advertising from DStv viewership because no ad revenue was retained by MultiChoice.

It said there was a misconceived assumption that removing must-carry would open a massive untapped revenue stream for the SABC.

A MultiChoice spokesperson said must-carry rules ensured universal access to public broadcasting.

"The SABC is the public broadcaster and its core mandate is to produce public interest content and broadcast it throughout SA and service the needs of all South Africans. For this reason, we don't support the proposal to remove the must-carry rules as they ensure public-service channels are accessible to those . citizens who watch television through pay-TV."

MultiChoice said apart from not collecting advertising revenue earned on SABC1, 2 and 3, it also forwent the opportunity to carry other channels from which it could earn revenue. The spokesperson said MultiChoice did not oppose the obligation to enter into a commercial agreement, "provided it is reasonable and proportionate".

Ntuli said the fact that the SABC earned money from advertising appearing on its channels on DStv and other subscription broadcasters was a "regulatory red herring".

"The SABC has a right to earn advertising revenue from SABC audiences wherever they are, on analogue, DTT, streaming, Openview or the DStv platform. Advertising is a core commercial basis of free-to-air broadcasting and is not a benefit afforded to the SABC by DStv," she said.

Icasa invited public comments on the draft regulations after it published these last month. Public hearings will be held on June 28. Icasa aims to finalise the process and have the amended regulations in place by the end of March next year.

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