SABC blunder
The South African Broadcasting Corporation’s (SABC) dire financial position can be linked to the government’s failure to revise its funding model 15 to 20 years ago and squandering opportunities that could have generated significant revenue.
This is according to Media Monitoring Africa director William Bird, who told 702 that the SABC’s new revenue stream must be generated from a public source.
“The money required to sustain the SABC will need to come from some form of public funding,” Bird said.
“Communication Minister Solly Malatsi’s options will include some form of public-commercial model.”
Malatsi has said that his department is developing a new funding model for the SABC.
While TV licence delinquency has been identified as one of the root causes of the broadcaster’s financial demise, with only 13% of South Africans currently paying the tax, Bird said several other factors have also contributed to this.
One of these is the analogue switch-off, which Bird said saw the beginning of a project to switch off analogue broadcasts before many SABC-viewing households were ready to receive digital TV signals.
The analogue switch-off has been in the works for roughly two decades, with 12 ministers failing to deliver on the project.
The latest deadline for its finalisation to be missed was 31 December 2024, with Malatsi pushing it out to 31 March 2025.
This was primarily due to the perceived impact as the SOS: Support Public Broadcasting Coalition warned that switching off remaining analogue TV signals could result in the SABC losing more than 60% of its audience.
eMedia CEO Khalik Sheriff shared this view. While he acknowledged that analogue TV signals must eventually be eliminated, he said more than 4.3 million households rely on them for information.
Bird said South Africa has also wasted several opportunities to get additional revenue, such as a recent spectrum auction.
Part of the need for the analogue switch-off is to free up spectrum for other purposes, such as mobile communications.
Bird said the R14 billion generated from the auction that went back into the fiscus should have been invested in a dedicated public interest content fund.
Bird’s argument that the analogue switch-off is a significant factor in the SABC’s demise is curious.
The public broadcaster has not reported a profit since its 2014/15 financial year, and its advertising revenue has been in decline for at least seven years.
A revised funding model
When asked whether the SABC should receive a portion of tax revenue instead of the TV licence, Bird said it could be a viable solution.
However, passing that into law could take five to seven years and will not help with the broadcaster’s dire financial position in the short term.
Malatsi is assessing the state broadcaster’s funding mechanisms, such as TV licence tax and advertising revenue streams, to determine what works effectively.
Malatsi also wants to investigate innovative ways of generating revenue for the public entity that leverages digital transformation.
Bird said in a previous interview that while the TV licence tax was supposed to generate revenue to fund content produced as a public service, it is instead the content that has brought in the most revenue for SABC.
One suggestion that the SABC has already made is a household levy to replace TV licences, as it says access to its content has expanded to multiple devices and is no longer only available on a TV.
It also suggested that the South African Revenue Services and DStv owner MultiChoice help collect this levy.
However, MultiChoice has said that making a private company responsible for collecting a state-owned rival’s tax revenue is an unacceptable solution.
The Minister said he would work closely with stakeholders to conduct technical reviews to ensure the sustainability of the funding models implemented.
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