Wednesday, May 22, 2013

South African government set to legislate exclusive TV rights and secondary TV rights reselling within SA pay-TV industry.


The South African government plans to intervene soon with new regulations in South Africa's lucrative pay-TV industry to basically legislate, through new broadcasting regulator amendmends, pay-TV operator's exclusive TV rights as well as the secondary TV rights reselling of content between broadcasters and between pay-TV operators and broadcasters.

The new regulations will mean that the South African government, through the broadcasting regulator, the Independent Communications Authority of South Africa (Icasa), will impose rules - which currently don't exist - placing limits on the exclusive content rights of pay-TV operators, as well as in a sense "forcing" them to resell some of those exclusive rights to other pay-TV operators and/or broadcasters.

Dina Pule, the minister of communications told parliament that Icasa will be issued with a policy directive to address competition inequalities within South Africa's pay-TV and television industry.  The department of communications now wants Icasa to put in place "market definitions" regarding exclusive and so-called "premium" television content.

While public and free-to-air broadcasters can theoretically lock up premium and exclusive TV content as happens elsewhere in the world, its more often pay-TV operators who secure these rights, and first. In South Africa that has left the SABC - through its own inadequacies - as well as the free-to-air commercial broadcaster e.tv, out in the cold.

Currently MultiChoice which operates the DStv satellite pay-TV platform and the pay-TV broadcaster M-Net which also supplies channels to DStv, are the de facto holders of the most and almost all premium TV content for the Southern African region when it comes to entertainment and sports rights.

Rival On Digital Media (ODM) which operates the struggling TopTV satellite pay-TV platform has complained the past three years that it can't start a sports channel or offering because most rights are sewn up by MultiChoice.

However, although MultiChoice also operates elsewhere in Africa, that didn't stop other pay-TV operators in the same countries where MultiChoice is operational, from introducing sports channels and providing premium content through clever self-compiled channels - ZukuTV for instance just launched a new sports channel.

Also, even if new regulations and laws compel MultiChoice and M-Net to resell TV rights and content to other operators and broadcasters, or prevent them from signing exclusivity deals, it remains unlikely that a lot of sport and premium entertainment content willsuddenly show up elsewhere.

The content will never be available for free, meaning rival pay-TV operators and broadcasters will still have to buy the content from each other. Although operators and broadcasters might be compelled by law to make it available and play nice, they might not be in a position to actually afford it.

In addition, in terms of the windows when entertainment rights to premium programming from overseas distributors become available, the window for public and free-to-air broadcasters follows very closely on that of premium pay-TV operators anyway.

Another "secret": Public and free-to-air broadcasters in South Africa can buy a lot of the very same TV sitcoms and dramas as those shown on DStv and M-Net and actually soon after they've started showing - they just choose not to because of price and often wait longer since the licensing rights pricing goes down over time.

It's therefore unlikely that artificially introduced competition curbing rules will lead to South African viewers seeing more or different TV content in more different places.

The "market definitions" might further include other regulatory specifications. TV content resold, for instance live sports coverage of premium sporting events, will come with clauses - it won't be resold as "live" for instance, meaning viewers on a rival operator or broadcaster will only be able to see the content in a so-called "second window" a few hours or a few days later.