Telkom Media has been awarded a commercial satellite and cable broadcasting licence by ICASA, the industry regulator. The licence allows Telkom Media to operate both a satellite pay-TV service and an IPTV service in South Africa.
“We and our shareholders are absolutely delighted with this award. We welcome the finalisation of the conditions of the licence based on our proposal submitted to ICASA and look forward to providing inspiring, dynamic and refreshingly different programming for our subscribers,” said CEO Mandla Ngcobo.
Shareholders in Telkom Media include Telkom, Anant Singh’s Videovision Entertainment, MSG Afrika Media and WDB Investment Holdings (Pty) Ltd. While Telkom is a majority shareholder the company says that it functions completely autonomously at an operational level.
“As a business we support and welcome competition. Accommodating additional forms of less expensive pay-TV, as well as IPTV and other platforms to disseminate information is vital for our young democracy. A market devoid of competition benefits a few at the expense of many,” says Ngcobo.
“Competition in the pay-TV market will change the face of television as we know it. New operators will extend competition, drive down prices and dramatically improve the variety of television channels available to South Africans. In addition, it will add to a dynamic media market, expand the number of subscribers significantly and attract further investment into the broadcasting industry and the nation’s economy in general.”
Telkom Media plans to use both satellite and cable – which will most likely involve ADSL 2+ – to bring their offerings to consumers.
Rikus Matthyser, Telkom Media’s Chief Strategist – says that Telkom Media will partner with any company which can provide them with suitable network infrastructure to ensure high quality services to consumers. Matthyser said that this may involve new network infrastructure players like Vodacom, MTN, Neotel or InfraCo.
Telkom Media plans to offer a range of international channels that previously have not been available in SA and has started negotiations with a number of international content providers to bring new content to SA.
In addition, the company will be creating a number of channels locally. These will be designed to have maximum appeal and relevance to a modern South African audience and will incorporate both acquired and newly commissioned content.
Matthyser points out that Telkom Media’s own channels will include a 24 hour news service, sports channels, general entertainment and actuality programs focusing on local content.
Telkom Media is investing heavily in their own studios and says that content will be a big differentiator in the market.
Matthyser further points out that the company is building a High Definition TV network (HDTV), and that Telkom Media will definitely look at bringing HDTV content – which may include the 2010 World Cup – to consumers.
Level Playing Field
However, while competition has been introduced into the broadcast sector, Ngcobo believes there needs to be proper intervention from the Regulator and the Competition Commission to ensure a level playing field.
“We would like to see the market aligned with international best practices, which we do not believe is the current situation,” Ngcobo says.
Telkom Media in its licence application proposed to carry other local niche independent channels based on the viability of the venture and their commercial and strategic fit. Telkom Media said it was pleased to see that ICASA acknowledged this in its licence award.
Telkom Media services in short
Telkom Media will offer various services using satellite systems, dedicated broadband networks (IPTV) and the Web.
Telkom Media will most likely kick off with their satellite offering which will be available throughout South Africa, while their IPTV service will initially focus on metro-poles and extend to smaller towns later on.
* Satellite: This service will consist of a basic set-top box or, in a premium version, a set-top box with digital video recording capabilities. There will be a tiered bouquet structure, with a basic bouquet available for approximately R100/month. Content will include local live sport, movies, soaps and drama aimed at middle income bracket subscribers. There will also be news, documentaries, children’s programming and reality shows.
* IPTV: This service will provide both linear broadcasting content and video on demand using broadband digital subscriber lines (delivered over Next Generation DSL). It will be interactive and offer additional channels to those offered on the satellite platform. The system will be based on best-of-breed technology and content will be protected using digital rights management schemes. The platform will also be made available to Internet service providers who want to build their own bouquets.
Both the satellite and IPTV services will use MPEG4 compression and some channels will be made available in high definition.
* The Web: In order to add value for broadband users Telkom Media will offer services such as Web TV and music and video downloads. Online games and user-generated content will also form part of this offering.