High hopes for the SABC

Despite reporting losses each year since the 2014/15 financial year, the SABC says it plans to return to profitability by March 2028, when it expects to report a profit of R907 million.

It has significantly reduced its losses since it reported a R1.13-billion loss in the 2022/23 financial year. It expects to report a loss of R590 million for the current financial year.

This was revealed in documents presented to the Portfolio Committee for Communications and Digital Technologies. The committee congratulated the SABC on its financial improvements and turnaround strategy.

Despite the improvement, the committee again called for changes to the SABC’s funding model.

The SABC also predicted that it would report an almost R1-billion profit by March 2028. Following its presentation to the portfolio committee, MyBroadband asked the SABC how it plans to reach profitability by 2028.

It didn’t provide specifics, saying the details are commercially sensitive. However, it said it plans to reduce its R590 million loss expected for the current financial year to a R243 million loss in the 2025 financial year.

“The SABC has a commercial strategy and corporate plan geared towards the financial recovery of the entity,” it said.

“Our key priority initiatives to protect current revenues and drive sustained growth are subject to funding.”

It said the trend of forecasted losses for 2024 and 2025 shows the state-owned broadcaster’s focus on clawing back its previous losses.

Part of its plan involves leveraging the SABC+ streaming service, which the public broadcaster says is yet to be monetised.

It anticipates that the recently revamped streaming service will have over half a million users by the end of the financial year.

“SABC Plus is our latest innovation, reinforcing the public broadcaster’s commitment to providing the best programming,” said SABC Group CEO Nomsa Chabeli.

Portfolio Committee on Communications and Digital Technologies chair Khusela Sangoni said she fully supports reworking the public broadcaster’s funding model.

“There’s a request to you from the members: give us the options. Give us something to work with. We’re in the process of looking at the bill to see if there are legislative requirements that need to be effected,” she said.

The bill to which she referred is the recently published draft SABC bill, which, if anything, shows that the government isn’t in a rush to fix the SABC’s funding model.

The bill proposes finalising an alternative funding model framework within three years of passing legislation.

Massive TV licence headache

In its feedback to MyBroadband, the SABC noted that its TV licence evasion rate has been above 80% for the past five years, significantly impacting its financial standing.

The TV licence evasion rate climbed from 69% to 81% between 2019 and 2020, after which it climbed to 87% in the 2023/24 financial year.

“Hence the importance of a sustained financial model for the funding of the public mandate via the legislated process articulated in the proposed SABC Bill, which is currently being considered by Parliament,” the SABC said.

South Africa’s communications minister, Solly Malatsi, recently revealed some “wild ideas” for fixing the SABC during an interview with MyBroadband.

He explained that South Africa already has systems for collecting outstanding money from citizens, such as fines for customers who want to renew their driving licences.

“If you’ve got multiple vehicles, you can’t renew the one without settling fines on the other, because those things are coordinated and integrated with eNatis,” the minister said.

Malatsi said there could be an opportunity to link the TV licence to other licence fees to ensure collection.

However, he emphasises that these were just ideas rather than policy announcements.

Another alternative is to implement a household levy that must be paid if households can access SABC services, regardless of whether they use them.

The SABC recently reiterated its support for a household broadcasting levy. However, it changed its tune on the collection process surrounding the tax.

It previously suggested that the most prominent players in the South African market, such as MultiChoice and Netflix, collect the fees on its behalf.

“The SABC supports the proposal for a public media levy. However, it must be noted that no collection method or agency can be considered until the regulations are known,” it said in its most recent feedback.