Remarks by communications minister Dina Pule in parliament on Tuesday imply that MultiChoice, which towers over South Africa’s commercial television broadcasting industry, could be forced to make premium content available to rivals in an effort to strengthen competition.
ould pay-TV operator MultiChoice, which owns DStv, be forced to allow rival broadcasters access to premium sports and entertainment content that it has bought rights to? If communications minister Dina Pule gets her way, this could happen.
Pule told parliament on Tuesday that the department of communications intends issuing a policy directive to the Independent Communications Authority of South Africa (Icasa) to address competition in the broadcast sector by creating a “market definition” for wholesale access to premium TV content.
“As part of our efforts to increase competition in the broadcasting area, I intend issuing a policy directive in the second quarter of 2013/2014 to Icasa to issue a regulation on market definition for wholesale access to premium TV content to address market competition.”
Should such regulations come into effect, they could prevent broadcasters from signing exclusive distribution rights with content providers. The move could, for example, open up rights to sporting events to multiple broadcasters.
UK regulator Ofcom has similar rules to help rivals of BSkyB, Britain’s biggest pay-TV operator.
Around the time Icasa issued licences for new pay-TV broadcasters, MultiChoice signed lengthy exclusive deals with the best entertainment and sporting content providers, including the rights to the Premier Soccer League (PSL) — crucial content for any prospective broadcaster wanting to target the growing black middle class audience in South Africa.
On Digital Media’s TopTV, the only one of five operators licensed to launch commercial services to rival DStv, has struggled to gain traction with consumers, in part because it lacks the premium content, including sports, that would attract subscribers.
TopTV, which has fewer than 200 000 active customers, is now in business rescue under section 129 of the Companies Act. Last month, the company’s creditors approved a rescue plan in terms of which China’s StarTimes agreed to purchase a 20% stake.
MultiChoice GM for corporate affairs Jackie Rakitla says his company will make “written representation” about the policy directive proposed by Pule when it is published for public comment. He declines to comment further at this stage.
Meanwhile, e.tv regulatory affairs group executive Lara Kantor has welcomed the development, saying it’s “a crucial area that needs to be addressed” in the multichannel environment that will emerge when South Africa migrates from analogue to digital terrestrial television.
Kantor says making premium content more widely available “will allow all broadcasters the opportunity to compete on an equal footing and give all South Africans access to content that has traditionally only been available on one pay-TV platform”.
E.tv was one of the successful applicants for a pay-TV licence, along with TopTV, but expressed concerns at the time that access to premium content would limit its ability to compete meaningfully with DStv.
Source: TechCentral – Craig Wilson.