STAATSKOERANT, 24 JANUARIE 2014
No. 37261
8.8.1.1 Television Services
Subscription television services have shown extremely strong growth in audiences in recent
years. This has been driven by an increase in subscribers to DSTV rather than increased
competition in the sector. There were three subscription television services on air by October
2013 - satellite subscription services, DSTV, and terrestrial pay TV operator M-Net - both
part of Nasionale Pers' Multi Choice - and new player TopTV/StarSat. As noted in other
sections, TopTV/StarSat is the only one of five additional subscription services licensed by
ICASA in 2009 to go on air. It has faced challenges - and was placed under business rescue
in 2012. ICASA has recently invited applications for new subscription services and was
considering these applications at the time of finalising this Green Paper.
The growth of DSTV (in terms of number of subscribers and therefore both subscription
revenue and its share of adspend) is linked to its strategy to increase penetration by offering
a range of different and cheaper bouquets targeting different sections of the population.
DSTV has also in recent years increased the number of South African channels it airs
(including the introduction of a range of Mzansi channels) - thus contributing towards the
public interest objective of ensuring that South African audiences have access to South
African content across all platforms. This increase has been driven by commercial
imperatives rather than regulatory requirements. The four FTA channels (SABC 1, 2, 3 and
e.tv) which are simulcast by DSTV are among the most popular services on the platform.
Subscriptions to M-Net have declined over the period - from 16% of the adult population in
1998 (4,1 million viewers) to under 10% in 2012 (2.41 million) The pay-tv service has stated
that this is in part due to delays in the launch of DTT as it stopped marketing the sale of
analogue set top boxes pending the launch. M-Net is one of the key channel providers to
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DSTV. It will be able to offer an increased number of channels to subscribers with the
migration to digital transmission.
Given the dramatic changes in the pay-TV market since the development of the White
Paper, it may need to be necessary to review many of the policy and legislative provisions
that currently apply to these services. In the 2013 parliamentary hearings on amendments to
existing laws, for example, other licensees suggested that subscription services access to
advertising should be further limited as they claimed this threatened the viability of the FTA
services. Parliament indicated that such issues should rather be discussed through a holistic
review of broadcasting related policies. The existing White Paper recognises that
commercial free to air broadcasters rely almost entirely on advertising and sponsorship
revenue to meet key public interest objectives. It therefore stipulated that subscription
services should rely primarily on subscription fees and that free to air services must have
access to "revenues that are sufficient to allow them to meet their public service obligations".
Given the number of subscribers to DSTV and M-Net at the time, it was believed that this
would sufficiently limit such services access to advertising. The situation has however
changed and the overall subscription revenue now exceeds that of overall television
advertising revenue.
8.8.2 Commercial Radio
Commercial radio broadcasters do not face the same immediate challenges in relation to
digitisation as television services - though there are an increasing number of South African
internet radio stations and international and local music streaming providers.
As commercial radio broadcasters are licensed to cover different licence areas, and/or to
provide different formats and services, the current licensing framework is aimed at ensuring
that services do not directly compete with each other. These measures are further aimed at
promoting diversity of services and content available to audiences.
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