Tuesday, May 8, 2018

Cape Town Television (CTV) makes shocking revelations to the broadcasting regulator about how all of South Africa's community TV stations are dependent on money from the pay-TV giant, MultiChoice, for their survival.

Cape Town TV (CTV) is shocking South Africa's TV industry in a submission to the broadcasting regulator, with eye-popping revelations about the degree to which community TV stations have all become dependent for their live blood on feeding off of MultiChoice for its financial survival, including channel carriage for ratings and infrastructure support.

And they're desperate for more.

Community TV channels in South Africa are battling a persistent existential crisis and they want the broadcasting regulator to create and introduce fixed formal rules to ensure that MultiChoice will support and give money to the community TV stations.

The Cape Town community TV channel, in its written submission to the Independent Communications Authority of South Africa (Icasa) detailed the extend to which community TV stations, supposed to serve and be sustained by their respective city and regional viewers, have in a sense become dotted little MultiChoice TV outposts across the country - community channels that are not supposed to be commercialised, but getting money from a pay-TV business.

Community TV stations are now heavily dependent on the Naspers pay-TV giant for literally millions in financial support and infrastructure upgrades - and they gladly take it just to survive.

It does however raise serious questions about the degree to which community television stations in South Africa are really independent, and able to function independently, when their financial positions and operational existence is so largely tied to MultiChoice pumping millions of rand into these stations - as well as dictating terms in some stifling contract stipulations that their audiences are blissfully unaware of.

Icasa on Monday started a week-long session of oral hearings in Johannesburg as part of a yet another new inquiry by the regulator about subscription television broadcasting services, or in layman's terms "pay-TV" in South Africa.

Icasa wants to try and find out how to possibly better regulate South Africa's pay-TV industry where Naspers' MultiChoice, although not enjoying a monopoly, dominates the market with its DStv satellite pay-TV service with brands like SuperSport and M-Net that have the cash and willingness to scoop up premium international entertainment and local and international sports rights, often with exclusive licensing and broadcasting window contracts.

Icasa already received written presentations from the SABC, South African Rugby, South African Cricket, e.tv, the Premier Soccer League (PSL), Econet Media's Kwese TV, Vodacom, MTV, Liquid Telecom, the Association of Community TV in South Africa (ACT-SA), Cape Town TV (CTV), Deukom, Cell C, Telkom, as well as a joint submission by the Support Public Broadcasting (SOS Coalition) and Media Monitoring Africa (MMA).

Several of these current and wannabe broadcasting sphere players as well as organisations are also be making oral presentations throughout this week.

CTV written submission - deliberately or unintentionally - rips the veil off of the extremely precarious position that community TV in South Africa finds itself in.

The submission paints a picture of just how horrifically bad and tenuous the existence of community TV channels are and who are to a large (and unhealthy) degree dependent on not just money from MultiChoice, but also infrastructure help and to lift ratings and increase audience reach through channel carriage.

Community TV in SA no longer able to survive without DStv
CTV that began broadcasting in September 2008 and has been carried on DStv since 2012, says in its submission that "all of the licensed community TV channels in South Africa are carried on MultiChoice's DStv platform and rely on this carriage to sustain their audience numbers".

"Carriage on national pay-TV platforms is essential to the survival of the community TV channels in the current broadcasting environment and consequently there must be a 'must carry, must pay' obligation on MultiChoice to carry community channels."

The irony is this: While community TV stations are supposed to broadcast to their communities in cities and provinces, because of their channels' carriage on MultiChoice, the majority audience share of community TV stations is on DStv.

It means that people watch community TV channels not through terrestrial TV means but as a channel through and on DStv.

"Unfortunately DStv has been allowed to become so dominant in South Africa today, that it is simply not possible for free-to-air broadcasters to survive on free-to-air distribution alone," says CTV.

Community TV channels being on DStv 'essential to their survival'
In shocking viewership figures, CTV's submission includes ratings data from January 2017, showing just how many DStv subscribers are watching community TV channels not on a free-to-air basis, but on DStv.

January 2017
Channel                         BayTV       Cape Town TV   Soweto TV    Tshwane TV    1KZN TV
National (all platforms)  2 836 029      2 723 684             6 587 924         2 902 519          3 832 200
DStv                                    2 696 806       2 188 519             4 168 855         2 520 315          3 489 094
Free-to-air                              139 223         535 165              2 419 069            382 204             343 106
Percentage DStv                 95.5%              80.35%               63.28%             86.83%          91.05%

It clearly shows that all community TV stations in South Africa gained the majority of their viewership from their presence on MultiChoice's DStv. Some channels have over 90% of their audience solely on, and coming from, DStv.

"It is important to note that in this context, the presence of community channels on the national platform provided by DStv is essential to their survival," says CTV in its submission.

MultiChoice's infrastructure help
CTV says "MultiChoice has been spending large amounts of money on building infrastructure for the community channels, although this spend has been uneven and some channels have benefited more than others".

CTV reveals in its submission that MultiChoice's spending spree on community TV channels kicked off in 2014 when Naspers' pay-TV operator gave R5 million for the construction of a Final Control Centre for Bay TV in Port Elizabeth when that channel was still licensed as a free-to-air community channel.

"Bay TV subsequently lost its terrestrial broadcast licence and is now carried only on DStv," says CTV.

"MultiChoice has also invested heavily in Zallywood's Tshwane TV and 1KZN TV; we do not know the extent of its involvement with Soweto TV."

"MultiChoice has also donated equipment and is funding the development of studio and broadcasting infrastructure at Cape Town TV; and MultiChoice pays for the fibre link which carries Cape Town TV's broadcast signal to Johannesburg for ingest and broadcast on the DStv platform."

MultiChoice has also given its Diski Challenge soccer matches to community broadcasters unders its corporate social investment (CSI) banner with community TV channels that are allowed to broadcast these matches if they want, at their own discretion.

MultiChoice's carriage contract for CTV has limiting stipulations
CTV reveals in its submission to Icasa that from 2012 to 2017 the contract between MultiChoice and Cape Town TV carried a clause which prevented CTV from being carried on any other pay-TV platform, like for instance StarSat as a community TV station.

CTV says it "was forced to accede to this provision because it would not be viable for it to lose its DStv audience while the other pay-TV providers occupied such a miniscule segment of the market".

Cape Town TV says that it is in the process of negotiating a new contract with MultiChoice, with MultiChoice that has "offered terms" such as "deletion of the exclusivity clause which prevented carriage of Cape Town TV on other pay-TV platforms".

This two-sided sword however, comes with another downside.

CTV says MultiChoice would then as (b) prohibit CTV from "from advertising that it is carried on other pay-TV or any digital, online platform, should it be so carried, on the DStv platform; (c) that MultiChoice will pay Cape Town TV an annual fee of R1 million for its carriage on the DStv platform; and (d) MultiChoice will also pay for the fibre link that carries the Cape Town TV signal from Cape Town to Johannesburg".

CTV told Icasa that "Cape Town TV believes that point (b) will have negative consequences for its ability to trade in the online space and is consequently arguing that this clause be altered to allow for cross-channel advertising."

CTV: MultiChoice must pay community TV - and it should be enforced
CTV says that "in addition to the above negotiations around contractual arrangements between MultiChoice and Cape Town TV, MultiChoice has indicated that it intends to standardise its contributions to community television channels".

"We assume that this means that MultiChoice will spend equal amounts on all of the community channels that it carries."

"The above-mentioned interactions indicate that MultiChoice is both carrying SA's community channels on its DStv platform and paying and/or supporting them through financial and other contributions."

"We believe this is overall a positive feature of the broadcast environment; however this support is purely at the discretion of MultiChoice and we believe that regulatory enforcement of this situation by ICASA will secure the sustainability of the community channels going forward."

CTV says "with regard to monetary contributions from MultiChoice to the community channels, we believe this should be independently regulated by Icasa and not left to the discretion of MultiChoice".

"Icasa should arrive at a formula for calculating the amount which DStv pays to community channels in exchange for their carriage on the platform, their concomitant appeal to audiences on this platform and their promotion of the DStv platform on the community channels, together with MultiChoice's CSI obligations."

Concerns over possible pay-community TV
CTV tells Icasa that it is worried over the Association of Community TV South Africa (ACT-SA) that  supports the possible introduction of pay-community TV stations in South Africa and that such a thing would "commercialise" the community TV sector even more.

"It's concerning that ACT-SA called for the licensing of subscription community television services which would be 'provided through satellite, cable or any other technology'. We believe that this aspect of the ACT-SA submission is aimed not only at further commercialising the sector, but that it refers to the initiation of commercial local channels on DStv which compete directly in this same space with the free-to-air community channels."

"This is occurring through the channel authorisation procedure whereby Icasa is called upon to authorise new channels on the pay-TV platforms."

"A case in point is that of Gau-TV, a channel owned by the Zallywood company that runs Tshwane TV, and which competes directly with Soweto TV," says CTV.

CTV says "ICASA must pay more attention to its channel authorisation process with a view to minimizing unfair competition between local channels on DStv".

ALSO READ: e.tv warns South Africa's broadcasting regulator, Icasa, that the free-to-air broadcasting sector in the country is under threat and needs urgent protection as a new inquiry into SA's pay-TV market kicks off.