Earlier this year Caxton, together with Media Monitoring Africa (MMA) and the civil society public broadcasting pressure group SOS Coalition took MultiChoice and the SABC to the Competition Tribunal.
The coalition argues that the contract signed in July 2013 - according to which the SABC is exclusively supplying MultiChoice's DStv with the SABC News (DStv 404) channel since August 2013, as well as the SABC Entertainment channel which will be launched soon in exchange for millions of rand including the digitisation of the SABC's archives - constitutes a "merger" between the Randburg-based company and the SABC.
The coalition alleges that the controversial contract not only gives MultiChoice undue exclusive access to SABC content, but also placed MultiChoice in a position to influence SABC policy.
Legal representation for MultiChoice earlier this month asked MMA to remove from its website the controversial contract, now a public document, which details the specifics of the channels agreement between MultiChoice and the SABC. MMA refused.
Caxton, MMA and the SOS Coalition is arguing that the deal is not in the public interest and that the deal works against the long-term interest of the SABC as well as the South African public.
Besides the supply of the two TV channels to DStv, MultiChoice and the SABC both do not want set-top box control in the STBs which viewers will need to watch TV once the country switches from analogue to digital terrestrial television (DTT), a process known as digital migration.
The free-to-air broadcaster, e.tv from Sabido, wants set-top box control and is taking the minister of communications, Faith Muthambi, to court over it.
"We totally reject the allegations and the misrepresentations they're based on," says Nolo Letele, MultiChoice's executive chairperson in a statement issued this afternoon by MultiChoice regarding Caxton, MMA and the SOS Coalition's legal bid before the Competition Tribunal.
The statement follows an open letter from Nolo Letele published in some newspapers of the Independent Media group yesterday.
"There's simply no basis to suggest that there is anything wrong with our relationship with the SABC."
"The truth is: this is a standard commercial agreement for the supply of two television channels - a news channel (already on DStv) and an entertainment channel (which will be added shortly). We have the same kind of agreement with dozens of other channel suppliers, locally and internationally," says Nolo Letele.
"It is also standard practice to commission and license new channels. So there's no way this can be described as a 'merger' that needs approval by the competition authorities."
"It's also not true to say we've influenced the SABC's position on encryption," says Nolo Letele.
"The SABC has taken different positions on encryption at different times during the digital migration process for reasons unrelated to the agreement with MultiChoice. However, before the agreement with MultiChoice was concluded, the SABC was opposed to encryption".
This past Friday, 17 April, MultiChoice says it "responded to these allegations in an affidavit, which was submitted to the Tribunal".