Pay-TV operators to face tribunal

[daveza]

http://www.itweb.co.za/index.php?op...cle&id=49428:paytv-operators-to-face-tribunal

SA's two pay-television operators now face a tribunal process after they were issued with compliance notices by the National Consumer Commission (NCC) last month.

Digital satellite television operator MultiChoice and newcomer TopTV were issued with compliance notices on 13 October, compelling them to review respective customer offerings in terms of section 13 of the Consumer Protection Act (CPA).

Commissioner for the NCC Mamodupi Mohlala said, at the time, consumers had the right to choose and “if goods are bundled, consumers must derive economic benefit from buying the bundle”.

In terms of the CPA, said Mohlala, the two entities would have to revise their packages and consider finer categorisation of channels, according to specific genres, as well as offer individually priced channels to customers, rather than just channel bouquets or “bundles” as they are currently doing.

Both operators refuted the notices, and the matter will now head to the National Consumer Tribunal in line with section 101 of the CPA.

Corporate affairs GM at MultiChoice SA, Jackie Rakitla, said the company did not believe it was in contravention of the CPA, but declined to comment further until the matter was resolved.

Vino Govender, CEO of TopTV's umbrella organisation, On Digital Media (ODM), said the company rejected the NCC's order because it would “force us to offer consumers the ability to pick and choose the channels they want to subscribe to”.

Govender said it would threaten ODM's business model and could force the only pay-TV alternative to MultiChoice out of business. He said a pick-and-mix a la carte option did not make financial sense and the remodelling of the product structure would cause serious harm to the business.

Mohlala says the tribunal may cancel, modify or confirm the compliance notices. Mohlala did not indicate when the tribunal process would start.

'offer consumers the ability to pick and choose the channels they want'

Yup, that is exactly what the consumers want.

 

[arcanum7]

Hope this tribunal hearing(s) achieve something. Even if it just forces the operators to further break-down their offerings with more choice of choosing.

Will wait and see what happens with this, holding thumbs.

 

[Shake&Bake]

Roll on CPA!

I'd be very interested to know how this all plays out.

 

[krugie]

I fully agree! I don't expect per-channel selection but at the very least per genre!

 

[satanboy]

Commissioner for the NCC Mamodupi Mohlala said, at the time, consumers had the right to choose and “if goods are bundled, consumers must derive economic benefit from buying the bundle”.

So we don't want to pay more, if we choose the channels/genre's separately.

 

[Nanfeishen]

'offer consumers the ability to pick and choose the channels they want'

Yup, that is exactly what the consumers want.

Its long overdue

I have never understood why they cannot do it, everything runs off the smartcard,
Customer goes along to office with smartcard, the operator programs payed for channels onto the smart card, and bingo.

 

[satanboy]

Its long overdue

I have never understood why they cannot do it, everything runs off the smartcard, ...

Not "cannot", won't.

 

[Nanfeishen]

Not "cannot", won't.

Ya, too true , but love the fact that they claim it would also be an "administrative nightmare" :wtf:

Customer gets billed, customer pays bill

 

[MickeyD]

If it does come to pass I predict that we will end up paying more for our "selection of channels" than what we currently pay for the bundled package.

 

[waynegohl]

All they gonna do is charge you per channel and make it so high you will not get the same deal as you had before.

If you get 30 channels for R99 before you might only get 10 channels for your R99 now.

 

[MickeyD]

All they gonna do is charge you per channel and make it so high you will not get the same deal as you had before.

If you get 30 channels for R99 before you might only get 10 channels for your R99 now.

And all those "filler" channels that we only sometimes watch will be gone.

So you'll pay more for less.

 

[Nanfeishen]

All they gonna do is charge you per channel and make it so high you will not get the same deal as you had before.

If you get 30 channels for R99 before you might only get 10 channels for your R99 now.

Fine by me, barely watch more than 5 anyway

 

[DJ...]

If it does come to pass I predict that we will end up paying more for our "selection of channels" than what we currently pay for the bundled package.

Agreed. Although it doesn't affect their bundled price and therefore their arguments are moot.

The CPA drafts have been around for years already. My question is why they didn't prepare to comply? It seems to me that they intentionally avoided compliance in order to fight for exemption to some extent. An exemption application that is devoid of merit on the basis that they are not providing an essential service.

The other thing to bear in mind is that if there is major cross-subsidisation going on, then the CPAs will expose it. This means that if they hike prices unreasonably to falsely create an economic benefit on bundled products, then this will be transparent and will again be dealt with harshly by the law. This is what they are truly worried about in my opinion...

 

[MickeyD]

Agreed. Although it doesn't affect their bundled price and therefore their arguments are moot.

The CPA drafts have been around for years already. My question is why they didn't prepare to comply? It seems to me that they intentionally avoided compliance in order to fight for exemption to some extent. An exemption application that is devoid of merit on the basis that they are not providing an essential service.

The other thing to bear in mind is that if there is major cross-subsidisation going on, then the CPAs will expose it. This means that if they hike prices unreasonably to falsely create an economic benefit on bundled products, then this will be transparent and will again be dealt with harshly by the law. This is what they are truly worried about in my opinion...

Agreed. What they could also do is to consolidate their channels and keep the prices at the same levels. So our choices will become more limited and quite a few programs will disappear. And we still pay either the same or more...

 

[DJ...]

All they gonna do is charge you per channel and make it so high you will not get the same deal as you had before.

If you get 30 channels for R99 before you might only get 10 channels for your R99 now.

Not necessarily. They cannot falsely create an economic benefit after the fact. And as I said, this process will expose the cross-subsidisation pricing model that they are using which will make it easier to identify if they are unjustly hiking prices.

I say easier, however there are a plethora of other factors that will be taken into account when they price channels on an individual basis. The great thing about them objecting to what is the law, is that they will have to open up their pricing structure to the NCC...

 

[DJ...]

Agreed. What they could also do is to consolidate their channels and keep the prices at the same levels. So our choices will become more limited and quite a few programs will disappear. And we still pay either the same or more...

Correct to an extent. Their argument here is that they purchase bundled channels which affords them the opportunity to cross-subsidise to keep the prices low. This argument means that the cheap channels will increase in a per-channel model, not necessarily the primary channel as it remains a static cost.

If buying hammers from my supplier results in a 50% discount on nails, then if I split the costs to my customers, there is no need to hike my price on hammers. I only have to factor in the cost of carrying more nails due to a reduction in sales in nails. It gets a little more complex with the pay-TV model but the fundamentals remain the same.

Alternatively I could avoid that cost by creating better vertical bundles. I personally don't believe that the costs have to increase much, nor does the quality of service have to be diminished...

 

[DJ...]

They have had every opportunity to "prune" their bulky services and invest in better products. The fact that they haven't done so is no argument for exemption from the CPA. Nor is it justification to treat their customers like cash cows, however there's nothing really stopping them from doing so. They could easily manipulate their pricing matrix before submitting it to the NCC...

 

[MickeyD]

They have had every opportunity to "prune" their bulky services and invest in better products. The fact that they haven't done so is no argument for exemption from the CPA. Nor is it justification to treat their customers like cash cows, however there's nothing really stopping them from doing so. They could easily manipulate their pricing matrix before submitting it to the NCC...

Again, I agree with you. I really do hope for an improvement but the cynic in me thinks otherwise!