Multichoice pushes competitors out

by | May 28, 2008

The Mail & Guardian has established that MultiChoice attempted to
take Telkom out of the subscription-broadcasting market just months
before the regulator’s hearings to award new licences began, writes Lloyd Gedye in the Mail & Guardian.

Since then the broadcaster has taken new licensee e.Sat out of the market with a deal that will see the launch of the e.News 24-hour news channel on the DStv bouquet in June.

The M&G has viewed a proposal put to Telkom by MultiChoice in February 2007 that outlines the case for a joint venture that would deliver an internet television service (IPTV) to consumers.

An IPTV service is a television service that is delivered via your broadband connection, as opposed to YouTube, which is closer to the video on demand (VOD) model.

The proposal stipulates that the joint venture would prevent Telkom — whose subsidiary Telkom Media, which was also awarded a subscription broadcasting licence in September 2007 — from providing any satellite subscription, VOD or direct to home (DTH) outside of MultiChoice’s content.

The proposal states that the offer is subject to: “Telkom’s agreement not to offer pay-TV or VOD services on the Telkom IPTV platform other than by means of the content supplied in terms of the MCA [MultiChoice Africa] — Telkom IPTV joint venture.”

The proposal states that “MCA would also reserve the right to exit this MCA-Telkom IPTV joint venture at any time should Telkom offer a DTH service in South Africa”.

Responding to questions posed by the M&G this week, MultiChoice denied that it had tried to restrict Telkom from offering these services.

MultiChoice’s head of corporate affairs, Jackie Rakitla, says: “The proposal was never made conditional on Telkom not applying for a subscription broadcast licence. It was aimed at IPTV services and would not have prevented Telkom from launching any satellite subscription, VOD or DTH service.

“But in relation to VOD on the IPTV platform only — for which you do not require a broadcast licence — the terms of the proposal were governed by a non-disclosure agreement,” he says.

Click here to read the full report, posted on M&G Online.ÂÂÂ