Sunday, May 1, 2011

ONE YEAR LATER. TopTV turns one: The successes and challenges of the South African pay TV operator at its first birthday.


By one they walk, and as TopTV as South Africa's newest entrant to the pay TV market celebrates the first anniversary of the start of its commercial subscription television service and gives further tentative steps towards the terrible two's and hopefully greater maturity, the pay TV platform has achieved remarkable successes, whilst however also facing particular challenges.

ALSO READ: 6 ways in which TopTV is changing South African television.
ALSO READ: TopTV as a Model T: How TopTV's existence is turning into a game-changer in the South African pay TV market.

Since launching its commercial subscription television service on 1 May last year with just over 50 channels and adding 3 new TV channels as well as an Indian bouquet during the past year, the last officially stated subscriber mark is 200 000 for On Digital Media's TopTV. As a new entrant initially – and in some ways stillstruggling to cope with subscriber enquiries and demand and underperformance in customer service levels, TopTV has already left a lasting imprint on the pay TV industry in South Africa. Besides doing an erroneous double debit order run on subscriber accounts and after a year still remaining in limbo to start a monthly subscriber magazine, TopTV's mere presence has created two momentous and seismic shifts within the local TV industry.

Firstly TopTV's incentivised and heavily subsidised model to attract new subscribers is pure genius and absolutely serves the consumer. With incredibly subsidised TopTV decoder prices (now going as low as R199 per decoder in some cases), coupled with free (completely subsidised) installation, TopTV has been altering the South African landscape in 3 ways. Firstly the South African consumer will never again be willing to accept sky-high monopolised pay TV decoder and installation prices. Secondly, its spurring increased competition with MultiChoice's DStv not just lowering decoder prices but also increasing installation subsidies. Thirdly TopTV is inadvertently spearheading the switch-over to digital terrestrial television (DTT) with digital migration happening under some of the lower LSM market segments who are actually getting digital television because they're getting TopTV.

Secondly TopTV is proving that competition, even in its smallest germinating form is good with the end-benefit going to the consumer when it comes to TV content. Besides new TV channels exposing South African TV viewers to new content from a consumer programming point of view, TopTV (through the existence of its clutch of Fox channels) managed to clinch two hot and hit TV series The Walking Dead and (coming soon) Falling Skies. Its acquisitions any pay TV operator can justly be very proud of. No longer is M-Net the only premiere television content game in town.

Where TopTV would get failing grades however is the false promises – twice – of new channel additions to the platform which created false expectations, worsened by the lack of managing these expectations by the CEO Vino Govender who seems afraid to be seen and heard although he's the public face of the man in charge of running the company.

ALSO READ: How TopTV is spoiling its first birthday by not being willing to talk about it.

TopTV also didn't commission local programming as it promised and so far failed to secure an actual sports channel, or to self-compile one in the form of its envisioned Top Sport channel. TopTV's lack of communication with subscribers in the more traditional form of newsletters, a subscriber magazine and email – as well as the lack of engagement with the press (one press conference at launch, and nothing since) and ad agencies about channels that will eventually be ad supported, are also a concern. Within the space of a year major restructuring is also already taking place at ODM.

Before TopTV turns two, the first independent indicators of viewership on a number of TopTV's TV channels will be known. It's already clear that TopTV's addition – although aiding and hastening channel fragmentation in South Africa and spurring the process of ''ad buying per 100 000 viewers'' – is overall growing not only the exposure of viewers to more channels but also growing overall viewership. More South African households in total are watching television because they're now subscribed to TopTV; they're also watching more than just the SABC's 3 channels.

Challenges remain for TopTV and these challenges are in some respects growing and changing. How do TopTV battle churn and subscribers who flee due to bad service, a lack of attention and no new channel acquisitions? Is the goodwill the company (had) as the new entrant and underdog sustainable? Is a sport channel, new channels, local content and improved service levels possible and coming (soon)? Is the sign-up growth curve of new subscribers continuing that will eventually, hopefully bring TopTV to operational profitability? And where is TopTV in hardware development and the roll-out of new services like high definition (HD) television and a digital personal video recorder (PVR) which will both fuel and sustain subscriber growth and help to combat churn?

It's undeniable that at one year old TopTV has brought major change to the South African TV landscape. And it's been good and positive. Unquestionably the hope is – from a consumer point of view – that TopTV can not only sustain its existence, but also improve the few things that somewhat tarnishes its rainbow logo. The better TopTV does as a pay TV operator in South Africa, the better it is for the pay TV market as a whole in the country.

If TopTV can manage to survive and flourish it will benefit the entire TV industry and in essence – and most importantly – the ordinary TV viewer. It's the ordinary TV viewer who - irrespective of what they watch, through what platform or service provider or where - who deserves to benefit from the competition that arise and yield dividends when it comes to price, a profusion of programming choices, better customer service and advances and innovation in TV technology.