Johannesburg – Monday, 28 June 2021 – At public hearings held by ICASA today, the SABC welcomed draft regulations requiring that Multichoice and other pay-TV operators may only carry SABC channels “subject to commercially negotiable terms”.
Leading the SABC team, GCEO Madoda Mxakwe said:
“This Must Carry regulatory review process is vitally important not only because our industry has fundamentally changed in the last 13 years but also because ICASA is seeking to correct ‘a regulatory wrong’ first made in 2008.”
In 2008 ICASA’s Must Carry regulations had left out the phrase “subject to commercially negotiable terms”, without any justification for deviating from the language of the statute. The regulations were never changed and have required the public broadcaster to provide its three expensively produced channels to pay-TV operators for free for the last 13 years.
ICASA’s current draft regulations have finally corrected this omission and allow the SABC to exercise its statutory right to commercially negotiate carriage fees for its channels.
The SABC committed to ICASA that universal access remained an ongoing public mandate requirement for the public broadcaster. Mxakwe noted that the three SABC channels are now simultaneously accessible on several free, non-subscription platforms. These include satellite via Openview and Sentech, on DTT via Sentech and streaming via TelkomOne, Viu and others.
“The SABC regards its Universal Access obligations as an ongoing, sacred and non-negotiable public mandate that does not end simply because it may have been achieved on a multiplatform basis”.
“It is therefore unfortunate that Multichoice has sought to portray SABC’s statutory right to have the law correctly applied as having a ‘purely commercial’ motivation and that SABC wants to ‘sidestep its public broadcasting mandate in favour of its financial interests’. This is an extraordinary, unsubstantiated and untrue claim. The public broadcaster is simply seeking to exercise a legitimate statutory right to negotiate carriage fees which has been denied to it for 13 years”.
Multichoice had previously claimed that the “purpose of Must Carry is not to create a revenue stream for SABC”. Mxakwe responded that Multichoice had ignored the language of the legislation which clearly envisaged commercial negotiations.
“We ask the Authority today – if there is to be no revenue from the carriage of SABC channels, what would be the purpose of commercial negotiations?”
That said, the SABC’s over-dependence on commercial revenue is no secret and the public broadcaster has made submissions to government on increasing government grants and introducing a public broadcasting household levy. But this dependence on commercial revenue is unlikely to change anytime soon.
“The SABC cannot sit on its hands and fail to protect the interest of the Corporation while lengthy policy and regulatory processes unfold. The Board and management of the SABC have a fiduciary duty to ensure that the long-term interests of the Corporation are protected. This includes the lawful exercise of the SABC’s commercial rights”.
The SABC presentation to ICASA demonstrated that, in terms of overall audience numbers as at March 2021, twenty of the top thirty most-watched programmes on DStv were SABC programmes. While the presence of SABC channels on the DStv platform were often not the primary reason for subscriber take-up, Mxakwe said it was clear that:
- The growth, retention and targeting of so-called “mass market subscribers” is a core commercial strategy for the Multichoice Group;
- SABC’s programming has the highest audience numbers on the DStv platform; and
- This programming is a material factor in the growth, retention and targeting of mass market subscribers.
The Authority should also note that nearly one-fifth of the cost of SABC programming is funded by public funds (via licence fees and government grants). It is clearly iniquitous for the largest video entertainment company on the African continent to be guaranteed free content that has been partially funded by the public. In effect, you have a public broadcaster and public funds partially subsidising the programming costs of the largest video entertainment business in Africa. This is not sustainable. Nor is it fair”.
The SABC opposed MultiChoice’s proposal that “the Authority place the proposed amendments to the Must Carry Regulations on hold pending policy certainty”.
“After 13 years of SABC enduring an unfair, ultra vires regulation, it would not be in the public interest to place these draft regulations on hold, potentially for another few years. The regulations should be amended as soon as possible to align with the Act – as an interim solution – with a sunset clause to scrap regulations once policy and the enabling legislation changes”.
Issued By: Group Communications
Media Enquiries: Ms. Gugu Ntuli (Group Executive: Corporate Affairs and Marketing)
NtuliGM@sabc.co.za|T. 011 714 3311|C. 071 877 0513