The National Association for Manufacturers in Electronic Components (Namec) has slammed Naspers' pay-TV operator MultiChoice over its "blatant abuse of power", accusing MultiChoice of being involved in disguised State Capture over allegations of undue influence to change the South African government's policy on digital TV encryption for set-topboxes (STBs).
At issue is whether the media conglom's lucrative pay-TV unit is or was involved in undue pressure to get the controversial Gupta family through their ANN7 channel, and the SABC, to exercise pressure in return for getting their TV news channels carried on MultiChoice's DStv satellite pay-TV platform.
Explosive, leaked meeting transcripts between MultiChoice and the South African public broadcaster the SABC, as well as #GuptaLeaks contracts between MultiChoice and the controversial ANN7 D(Stv 405) channel showing massive payments from DStv to the Guptas, have raised multiple serious questions over corporate impropriety.
MultiChoice told the SABC it would pay the broadcaster R100 million for the SABC News channel but but only on the strict must-have contract clause condition that the SABC must support MultiChoice's stance on conditional access (CA) for digital television.
MultiChoice also dramatically upped its payments from R50 million per year to R100 million per year and then R141 million per year, as well as a questionable, additional R25 million payment to the Guptas for the low-rated, bad quality, mistake-filled and often criticised ANN7.
MultiChoice is paying ANN7 more despite its barely there low ratings than eNCA (DStv 403) that has more than 50% of the overall TV news audience share.
It's all created the perception that MultiChoice has paid kickbacks to both the SABC and ANN7 to use its influence to get set-top box (STB) encryption dropped from government-subsidised STBs in the switch to digital terrestrial television (DTT).
MultiChoice and Naspers have denied the kickbacks allegations.
Namec lobbied for encryption for the 5 million government-sponsored STB, a policy that was adopted but then suddenly overturned, with these subsidised set-top boxes, filling South African Post Office warehouses, currently not containing any conditional access (CA) system.
Namec says it will report MultiChoice to the Competition Commission for its alleged anti-competitive conduct.
Namec in a statement says "we have learned, with chagrin, revelations that MultiChoice – a monopoly in the pay-television space – got the then minister to unlawfully prevail over the state president to delegate powers that led to her pronouncing and implementing a policy on non-encryption that was to the benefit of MultiChoice".
"This misdemeanour is a blatant abuse of power, at best, and a disguised form of state capture, at worst, and there must be consequences for those implicated."
"Given a myriad of opportunities that include bridging the digital gap by opening access to more people and the economic spin-offs that digital migration offers, it is criminal that the corrupt and greedy have seen it best that our country miss the digital migration deadline as set by the ITU and, in the process, not only compromise our country's public standing, but also the financial well-being of emerging black electronic components manufacturers."
"Our members suffered not only prejudice, but huge financial losses that they have not recovered from."
"Namec calls for the upcoming ANC national conference to set tight timelines on the rapid roll-out of digital terrestrial television (DTT)."
"Implemented properly, DTT can be a lever for radical economic transformation as it will allow our country to increase the number of channels currently available and this will provide new broadcasting entrants endless opportunities to play in the mainstream of our country's economy."
