The ministry of communications announcement that applications for pay-TV licences will be put on ice has caused outrage among bidders who have invested millions and undermined Icasa, writes Anton Harber in Business Day. And the only beneficiaries are the existing players, who get to keep the lucrative market to themselves.
Imagine you have been invited to pitch for a pay-TV licence. You put together a consortium and hire a team of experts and all of you work for many months to prepare an application.
Come the deadline, you have burnt the midnight candle to get it done. It is a substantial technical document. Since the cost of entering the satellite market is billions of rand, you have spent a few million making your bid.
You have shown confidence in the new broadcasting system. You are prepared to invest billions in this market. You are feeling good. You know the regulator, which issues licences, is a little overburdened and slow, but it is worth the wait to get into this market, probably about a year.
There are lots of other applicants, but there is no spectrum shortage here, so you have a good chance of getting in. You see how much money MultiChoice is making in this lucrative market, and you canÃƒÂ¢Ã¢â€šÂ¬Ã¢â€žÂ¢t wait to compete for a slice of the large pie.
Then the minister of communications summarily withdraws the invitation. Just like that. Sorry, she says, but I have had another idea.
That is what has happened with pay-TV last week. Communications Minister Ivy Matsepe-Casaburri last week published her departmentÃƒÂ¢Ã¢â€šÂ¬Ã¢â€žÂ¢s plan for the migration to digital terrestrial broadcasting (the shift from our current analogue TV and radio signals to digital television for our standard free-to-air stations, which would raise picture quality and allow for many more channels). To avoid ÃƒÂ¢Ã¢â€šÂ¬Ã…â€œunderminingÃƒÂ¢Ã¢â€šÂ¬Ã‚Â this process, new pay-TV licensing should wait until the launch of digital terrestrial at the end of next year, the plan suggested. Stakeholders were given two weeks to comment.
The industry is reeling from this shock. How can the minister barge in at this late stage and interfere with the Independent Communications Authority of SAÃƒÂ¢Ã¢â€šÂ¬Ã¢â€žÂ¢s (IcasaÃƒÂ¢Ã¢â€šÂ¬Ã¢â€žÂ¢s) licensing process? How can she treat with such contempt those who want to invest billions in our media industry? How can she delay further a licensing process which has already been on IcasaÃƒÂ¢Ã¢â€šÂ¬Ã¢â€žÂ¢s must-do list for some years?
The only parties to benefit are MultiChoice and M-Net, who are given further breathing space without competition. Their licensing will go ahead.
The SABC is heaving a sigh of relief. It was not ready for satellite, and its focus is on the digital terrestrial roll-out anyway. It will be more concerned with the ministerÃƒÂ¢Ã¢â€šÂ¬Ã¢â€žÂ¢s proposal (another bolt from the blue) that they drop television licence payment for those who move to their digital system, and they be limited to five TV stations (their current three and the two new planned regional African-language stations).
The other pay-TV applicants include Telkom (which has planned a R6bn investment) and e.tv. Together, their investments and the existence of a host of new channels with plenty of local content would have been the biggest boost to the local industry for many years.
Lawyers working for the various bidders are adamant that the ministerÃƒÂ¢Ã¢â€šÂ¬Ã¢â€žÂ¢s threatened intervention would be illegal and unconstitutional. This may mean it will not go ahead. But it does mean that the ministry and department have, once again, brought havoc and delays to the industry.
There will be many protests. For Icasa it will be a critical test, as they will have to decide whether to allow the minister to mess with their work and their independence. If they let this happen, one industry player told me, you might as well rename it the ÃƒÂ¢Ã¢â€šÂ¬Ã…â€œIndependent Communications Arm of the MinistryÃƒÂ¢Ã¢â€šÂ¬Ã‚Â.
Small things often tell you about the big things. In researching this story, I went to the department website to contact their media liaison officer. I have left two messages on her phone in the past 24 hours and one at the switchboard and tried her cellphone half a dozen times. No luck. So I went to the ÃƒÂ¢Ã¢â€šÂ¬Ã…â€œLatest NewsÃƒÂ¢Ã¢â€šÂ¬Ã‚Â section of their website to see if I could download the necessary documents. Their latest news is dated November 2004.
This is the department of communication, which is meant to be leading the charge to bridge the digital divide. They tell us, by the way, that their deadline for digital terrestrial TV is November 2008, a mere 20 months away. By way of illustrating how unlikely this is, Britain set a 10-year plan for the same process ÃƒÂ¢Ã¢â€šÂ¬Ã¢â‚¬Â and they have just extended it by five years.
So if the minister wants pay-TV to wait until this roll-out is finished, we are going to have to be very patient. My guess is that there is such a wild party going on at MultiChoice and M-Net that they have been able to forget about their painful loss of open time, which kicks in at the end of the month.
* Harber is Caxton professor of journalism at the University of the Witwatersrand. His blog is at www.the harbinger.co.za.Ãƒâ€šÃ‚Â This column was first published by Business Day on 28 March.