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DTT – peace at last or the calm before the storm?
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Thu, 03 Apr 2014 10:50

With the finalisation of the Department of Communications’ policy on digital migration now imminent, one may be tempted to think that the matter – debated, discussed and delayed ad nauseam over the past several years – is finally settled. However, the opposing parties are still sticking to their guns and questions still remain.

As the debate over digital migration has progressed over the past few years, the media has tended to portray it as a stand-off with pay TV giant Multichoice on one side and free-to-air broadcaster etv on the other. A recent war of words between Minister of Communications Yunus Carrim and Multichoice CEO Imtiaz Patel seems to reinforce this perception. But is anything ever that simple? Emotions have run high and while questions arise, few definitive answers are provided.

Lack of public engagement

Karen Willenberg, Director of Regulatory and Legal Affairs at M-Net, says: “Decisions are being made today that will affect how South Africans watch TV forever, but no one is explaining the implications of these decisions to consumers. When the time comes to start digital migration, it will be too late. There has been a big gap in terms of just explaining what’s going to happen and how people are going to be affected.”

It seems a public outcry is inevitable. By the time migration starts, it may well become another e-toll saga – with the public saying they were not informed and refusing to pay, and the government saying that they were and that the policy is now set in place.

The Department’s response to this objection, as captured in Minister Carrim’s retort to an open letter from Multichoice to the Department in March, essentially amounts to an ad hominem attack on the multinational pay TV broadcaster. It accuses Multichoice of being a “bullying monopoly” that is afraid of competition in the market it has dominated for years, and as such, has absolutely no place speaking for the country at large and the poor in particular. But the department then offers no counter-argument as to how it is in fact dealing with public engagement on the matter. Requests to the department for comment were not answered at the time of going to print.

STB control

Digital migration is unavoidable and necessary. The entire world is making the move and South Africa was meant to be far advanced along the route already, the original deadline having been set for 2008. But the process of deciding on a policy and plan of action for the roll-out has been fraught with false starts and controversy. The most important sticking point so far has been the issue of STB control, with broadcasters and government firmly divided into camps on the issue, from which they do not seem willing to budge.

It was realised very early in the process that STBs would be needed, because most South Africans still have analogue TV sets. All parties agreed that this was the right way to go. The STB will convert the digital signal to analogue so that those viewers who still have their analogue television sets will be able to continue watching. Eventually analogue televisions will be phased out completely and the necessity for STBs will fall away. Government is to put out a tender for the manufacture of the boxes and also subsidise their cost for the country’s poorest television-owning households.

The debate now is whether or not the free-to-air STB should be equipped with encryption software, just as M-Net and DStv decoders are. Multichoice has opposed this proposal. Willenberg explains: “Logically you can understand why a pay TV operator must invest in encryption, it’s used to control access to content and to disconnect subscribers who don’t pay. The question is, why does free-to-air broadcasting need encryption? It’s a very curious decision to add to the cost and complexity of migration by introducing something that no other country, with the exception of Ukraine, has forced into policy.” For Multichoice and M-Net, Willenberg says, government’s reasons for the decision to include STB control do not satisfactorily answer this question.

Government’s position is that STB control will protect investment in the manufacture of the boxes and will also safeguard the business of local STB manufacturers. If STBs are stolen they can be disabled, and the inclusion of encryption will ensure that the market cannot be flooded with cheap, inferior- quality imports that threaten the livelihood of local manufacturers.

It also disputes Multichoice’s claim that only Ukraine has adopted encrypted STBs. Minister Carrim stated in his recent interview with TechCentral that many other countries are adopting the same system, among them Zambia, Uganda, Botswana, Namibia, Nigeria, Malaysia and Belarus.

Willenberg’s response to this: “The truth is that not one of the countries listed by the Minister has mandated encryption in policy. The difference in South Africa is that encryption is going to be required in every free-to-air STB as a matter of policy.”

The policy’s recent amendment only muddies the waters even further. It now states that STB control is mandated for inclusion in all STBs but broadcasters can choose whether or not to use it. It is thus mandated for manufacture but optional for use. And, the minister insists, those broadcasters who choose to use the encryption systems must bear the costs of doing so.

The issue of competition

This brings us to the cause of the ‘war’ that has supposedly been raging over STB control. Multichoice has expressed concern that the inclusion of STB control may effectively subsidise the entrance of pay-TV operators into the market. “When you launch a pay TV service,” Willenberg says, “decoders and encryption are some of your biggest costs. Government has committed to buying 5 million boxes for the poorest TV households and now the Minister wants to add encryption to make these boxes ready for pay TV. Effectively, government will carry the cost of a decision which will benefit narrow commercial interests. We have opposed this, the SABC has opposed it and community broadcasters have opposed it – at the end of the day, only one broadcaster is in favour of it. It makes no sense to mandate encryption under these circumstances. The objection is not to anyone else entering the pay TV market, that is something anyone is free to do at any time. The question is, why should government fund the entry of other operators?”

The commercial operator in question is e.tv, which is rumoured to have pay TV ambitions. When etv was approached to explain their position on the policy, they issued the following statement: “etv accepts government’s decision and we are looking forward to the finalisation of the policy. At this stage, we have no further comment.”

The constant back and forth between the differing parties makes it very difficult to discern what the truth of the matter is and what the most desirable option for the common good really should be. Multichoice and government have been very vocal on what their points of view are but other roleplayers have been rather quiet and thus the full picture has yet to emerge. The arguments on both sides carry considerable weight and so it looks as if the implications will only become clear once the roll-out starts, or certainly on the day when the switch is thrown and renegotiating is no longer an option.



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