Sechaba ka Nkosi
A controversial deal brokered between the SABC and MultiChoice to alter satellite television in South Africa has been put on ice.
The move follows a detailed protest memo to the broadcasting ministry from the SABC’s main signal distributor, Sentech, and a series of meetings among stakeholders.
Questions have also been raised about a potential conflict of interest if the agreement goes through as former SABC chief executive Zwelakhe Sisulu has an interest in MultiChoice through his new job at New Africa Investments Limited (Nail).
The deal, which was aimed at changing SABC signal distribution from the old- style analogue to digital, was on the verge of being signed after the SABC board apparently approved it in May. The multimillion-rand transaction, which would have transferred the SABC’s 30 000 satellite subscribers to DStv, would also have provided the corporation with a way out of its disastrous Astrasat experiment.
Sentech warned the government the deal could potentially isolate viewers in rural and areas from SABC TV channels. At present 70% of South Africans have access to a television signal and the government is committed to widening this to the entire population.
The deal was brokered by the SABC’s chief operating officer, Neil Harvey, allegedly with the backing of the group executive, including Sisulu. It has raised eyebrows in broadcasting circles because it could have given MultiChoice a satellite monopoly while government’s broadcasting policy is still being finalised.
Says the Sentech memo: “We are convinced a transparent process is required to consider the merit and timing of the proposed change from analogue to digital and the transfer of services provided by Sentech to MultiChoice/Orbicom which may virtually entrench them as a monopoly in pay television and satellite broadcasting.” It was signed by Sentech managing director Neel Smuts and confirmed by Sentech and the SABC as authentic.
Sentech sources say the government was drawn into the fray after negotiations between Sentech and the SABC failed to stop the imminent transaction. There were also fears that the transaction was being rushed to pre-empt possible restrictions on signal distribution proposed in the White Paper on broadcasting.
Minister of Posts, Telecommunications and Broadcasting Jay Naidoo confirmed the government’s involvement in talks about ways to improve SABC revenue and develop satellite channels.
“It is within the policy framework to make South African broadcasting globally competitive and to position the SABC as an African broadcaster,” said Naidoo.
SABC representative Enoch Sithole this week dismissed the memo as “unnecessary panic” by Sentech.
He insisted there were no attempts by SABC management to rush the deal before Sisulu’s departure. “Because anyway, I don’t think there is any trace of Nail at MultiChoice, not at all and not even by extension,” he said.
Nail enjoys great influence at Johnnic, which controls a stake in MIH Holdings, of which Orbicom is a division of growing influence. Satellite distribution is becoming increasingly important not only for television broadcasts but as a key to a multimedia future.
Sithole argued the change to digital transmission was part of the corporation’s overall strategy to rescue Astrasat and recoup some of the millions it had lost. The deal was void of any transgressions from competition and broadcasting policies.
He maintained the process had now assumed a new profile involving a number of stakeholders in the broadcasting industry.
The last meeting between the parties took place three weeks ago, he said, where agreement was reached, stipulating that Sentech would be an integral part of any of SABC’s satellite ventures. The agreement had not yet been signed.
“Government came on board because the broadcasting Act stipulates that whenever the SABC wants to [become] involved in other business ventures, it [the SABC] must have the blessing of the government,” Sithole said.
But Sentech sources are not as confident. They insist that last week, at the latest meeting of the parties, they failed to reach an agreement.
Broadcasting pundits say the deal may well be the way of the future. Although he could not comment on the process, analyst John Matisonn said: “It may be that South Africa can only sustain one satellite service. The regulator should be able to investigate that and require from DStv that the signal not be blocked.” He added that South Africa may have to follow the American “must-carry” rule where cable (satellite) operators are forced to carry public stations so that they do not lose (but may gain) viewers and advertising.
Additional reporting by Ferial Haffajee