Icasa to invite bids to rival MultiChoice
According to analysts, MultiChoice SA represents about 38% of Naspers’ value, and its Sub-Saharan operations close to 12%.
African Harvest Fund portfolio manager Rajay Ambekar said there were two main issues surrounding new pay-television licences: infrastructure and content.
“If Icasa allows a new pay-television operator to simply insert their smartcard into (MultiChoice) decoders, the threat of competition becomes much bigger for MultiChoice.”
As MultiChoice had invested heavily in the set-up of its local infrastructure, Ambekar expected the group to attempt to stop the opening up of the decoder to other operators.
“If they can’t stop it, the group will be hoping to get some fee from providing the box. It is all up to Icasa,” he said.
In its submissions to Icasa’s position paper on subscription broadcasting released last June, MultiChoice argued that the technological items used in broadcasting did not require licensing. It said that there was not any “suggestion in the broadcasting legislation that the authority’s jurisdiction extends to their regulation”.
Last week, a new operator called Black Earth Communications, which has applied for a subscription licence in Botswana, said it hoped to use the MultiChoice branded decoder to transmit its service — Black Entertainment Satellite Television.
In its findings from the position paper, Icasa said it would like to encourage the interoperability of decoders.
The authority also encouraged the industry to work together to develop standards that permit different Conditional Access systems, a system used to ensure payment is received in return for the consumption of programming.
On the content side, Ambekar said MultiChoice had some exclusive rights to the channels it broadcasts on its bouquet, channels new entrants would most likely want to broadcast.
MultiChoice said Icasa had no jurisdiction to deal with competition concerns relating to the exclusive acquisition of content. Instead it was the concern of the competition authorities.
MultiChoice said any attempt to undermine the principle of exclusivity would lead to less investment, lower quality, less content and a decrease in SA’s role in African broadcasting.
“Exclusivity and the advantages which flow from it are important for future subscription broadcasting services, which will have a strong need to differentiate themselves from one another to attract subscribers.”
Outside of sport, Icasa has decided not to regulate the exclusive acquisition of programming.
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