Former communications minister Yunus Carrim slated MultiChoice and the SABC for “policy capture” related to set-top box encryption.
Carrim said a R553-million deal between MultiChoice and the SABC was all about ensuring that there was no signal encryption in South Africa’s digital TV specification.
Signal encryption would make it easier for companies like Etv to enter the pay-TV market – something which MultiChoice allegedly wanted to prevent.
MultiChoice said at the time encryption was unnecessary for set-top box control, and it was a way to get the poor to subsidise Etv’s entry into the pay-TV space.
According to Carrim, MultiChoice inserted a controversial clause into its SABC agreement which ensured the public broadcaster followed the pay-TV giant’s stance on encryption.
Carrim said former MultiChoice CEO Imtiaz Patel made it clear that excluding this clause in the agreement with SABC will be a deal-breaker.
What followed was that the SABC changed its official stance from supporting encryption to opposing it – all within a matter of weeks.
Carrim said this about-turn by the SABC was particularly strange as it was against the policy directive of the ANC and the government’s plan to increase competition in the pay-TV market.
Accusations of insider political knowledge
During his testimony, Carrim said he was warned on a few occasions that opposing MultiChoice’s stance on encryption would have dire consequences for him.
He said while there was no direct reference to what the risks were, he understood it to mean that he will be fired as a minister for supporting encryption.
This is exactly what happened. Carrim was replaced by Faith Muthambi when former President Jacob Zuma announced his new cabinet in May 2014.
While Carrim did not bemoan the fact that he was replaced, he highlighted that a few strange things happened before he received the call from the President about the decision.
He said MultiChoice’s regulatory affairs official knew two months before he was replaced that it was going to happen, and even that Muthambi was set to be the new communications minister.
Carrim said this is particularly curious as he had no knowledge of this and did not even know that he was going to be replaced.
He added that two weeks before the new cabinet was announced, former SABC COO Hlaudi Motsoeneng and MultiChoice CEO Calvo Mawela had a party in Sandton to celebrate his imminent departure.
It is not clear how MultiChoice gained this insight long before the minister himself was told that he will be replaced.
Joe Heshu, MultiChoice group executive for corporate affairs, told MyBroadband that Carrim’s allegations concerning MultiChoice and some of its officials are baseless.
“MultiChoice and its officials deny these allegations,” Heshu said.
He added that MultiChoice has noted that Carrim confirmed under oath that he cannot attest to having personal knowledge of any fraud or corruption in respect of the SABC/MultiChoice agreement.
“We have informed the Zondo Commission that we will respond to the allegations made against us in due course and reserve all of our rights.”