Telkom’s broadcast bungle

Angry Telkom Media staff called for heads to roll this week in response to the announcement that Telkom had taken a decision to shut down its broadcasting subsidiary.

“Telkom should be taken to task over this,” said one angry staffer who wanted to remain anonymous. “How can you change strategy after you have employed more than 300 people? That’s just irresponsible.”

“I hope Telkom is made to pay for what they’ve done,” said the staffer. “Too many good people have been affected by this.”

Numerous staffers told the Mail & Guardian this week that Telkom’s board and senior management must be held accountable for the company’s failure to get off the ground.

When Telkom was awarded its broadcasting licence it headhunted numerous high-profile staff members from DStv, and the SABC, offering them hugely inflated salaries.

Most of these staffers have spent the past year revising business plans, freelancing or twiddling their thumbs.

“There are some people who are very angry and they feel their careers have been done irreparable harm,” said one staffer. “Telkom should be held accountable by its shareholders for making decisions that are all arse about face.

“Someone should take them [Telkom] to task for mismanaging this thing,” said the staffer. “How they are going to explain this to their investors I don’t know.”

Staffers estimated Telkom invested between R500-million and R700-million in the broadcaster, which had 379 staff in March last year when Telkom’s chief executive, Reuben September, sent the broadcaster into a flat spin by announcing that it was planning to reduce its funding of Telkom Media from R7.5-billion to R5.3-billion.

One staffer said that there were just more than 100 staff left and that they were frustrated and disheartened by the news that they had to read in the newspapers, because Telkom told them nothing.

But it appears that some staffers in the news department were informed last Friday that the company would be shut down and that they would not have jobs by the end of April.

Telkom released an announcement this week confirming that it would hold a shareholders’ meeting within the next 30 days to seek approval to wind down the company.

But a Telkom staffer told the M&G that none of the other shareholders, who include Anant Singh’s Videovision and MSG Afrika Media, had invested any money into Telkom Media, so shareholders’ approval to close down the company was a fait accompli.

Given Mkhari from shareholder MSG Afrika Media confirmed that Telkom was the only company to invest money in Telkom Media and that the shareholder meeting had been scheduled for April 16.

Telkom Media was one of four new subscription broadcasters that were licensed by the Independent Communication Authority of South Africa (Icasa).

Since Telkom’s announcement that it would dramatically scale back investment in the subsidiary there has been a pall of uncertainty over its future, with staff fretting about their jobs, expensive equipment sitting idle in warehouses and scepticism from potential investors.

Talks with a consortium, including Chinese company Shenzhen Media, to buy a portion of its stake collapsed because of Telkom’s desire to be compensated for the millions of rands it invested in the business.

“Any businessman will tell you that you can’t expect to be compensated for your mistakes,” said one staffer who felt that Telkom had bungled negotiations with interested investors.

Another Telkom Media staffer said Telkom had already spent more than R700-million buying three buildings, filling two Durban warehouses with equipment, building studios and securing access to satellites.

A source close to Telkom Media said the broadcaster had bought a cluster of buildings in Centurion and was busy equipping the building with studios and edit suites.

“The equipment has arrived and is waiting in a warehouse in Durban,” said the source.

The source also said that a lot of the Telkom staff had been sitting idle for the last year, adding that some staffers went in to work at 9am only to leave by 10am.

Some Telkom Media staffers said that the past year had been spent drawing up numerous versions of business plans to see if they could get the company up and running.

“I have spent the past year drawing up business plans,” said one staffer. “I could do one in my sleep now.”

Other staffers confirmed that they had been working on projects that were unrelated to Telkom Media, just to keep themselves busy.

“You can either say I can come in and twiddle my thumbs or you can find another job,” said one staffer. “I spent the time doing freelance work.”

Most of Telkom Media’s staff are concerned about trying to find work in the current economic climate.

“It’s a tough marketplace out there at the moment,” said one staffer. “I feel very sorry for the people who moved to Telkom Media from DStv and, because they were marched out of those employers’ buildings when they resigned and there is no way they could go back now.

Telkom Media spokesperson Chris van Zyl said there had been no official closedown of Telkom Media.

“The company cannot be closed down without a formal notification from the shareholders, of which Telkom SA is the majority shareholder,” said Van Zyl. “No notification has been received.”

Attempts to contact Telkom Media chairperson Connie Malusi and Video-vision head Anant Singh for comment were unsuccessful.

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Lloyd Gedye
Lloyd Gedye
Lloyd Gedye is a freelance journalist and one of the founders of The Con.

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