SABC, MultiChoice told to negotiate commercial channel-supply deal

MultiChoice Group and other satellite broadcasters must negotiate commercial agreements with the SABC to carry the public broadcaster’s channels on their platforms, communications regulator Icasa has decided.

Icasa published amendments to the so-called “must-carry” regulations on Thursday, in which it reiterated that satellite broadcasters (or at least those that offer more than 29 channels) must carry the television programmes of the public broadcasting service (the SABC is South Africa’s PBS).

Until now, the regulations have allowed MultiChoice and other pay-TV operators to carry the SABC public service channels at no cost. Under the amended regulations, the parties will have to negotiate a contract deemed fair to both parties.

The SABC had argued that the must-carry regulations were unfair and that commercial broadcasters were exploiting the situation to their advantage and to its financial detriment.

The changes to the regulations have been years in the making. After the SABC lodged a complaint with Icasa about the impact of the old regulations, the authority decided in 2019 to conduct a formal inquiry.

MultiChoice, the SABC said a year earlier, was getting a free ride, and it suggested that many of the most popular programmes viewed on DStv were in fact produced by the SABC — a claim the pay-TV operator disputed at the time.

The SABC said changes to the regulations were necessary, at the very least, because the Electronic Communications Act required Icasa to “protect the integrity and viability of public broadcasting services”.

‘Problematic’

The SABC entered into a must-carry channel distribution agreement with MultiChoice Africa on 1 April 2011 in terms of which it relied on the “problematic” 2008 regulations to contractually guarantee non-payment for the SABC’s three must-carry television channels, the public broadcaster said in a written submission ahead of the Icasa hearings on the matter.

“At the time, the regulations seemed to be drafted on the basis that the ‘must-carry obligation’ was an onerous one for pay-TV licensees and that these broadcasters would be ‘doing the public broadcaster a favour’… On the contrary, the SABC must-carry channels have commercially benefited MultiChoice Africa and other subscription broadcasters at the expense of the public broadcaster…,” it said.

The amended regulations state: “The PBS licensee (the SABC) must offer its television programmes, subject to commercially negotiable terms, to the SBS licensee (MultiChoice and others) upon a request from the SBS licensee.”

Icasa explained in a reasons document published with the amended regulations that it made this change because it believes that “payment, if any, regarding the transmission of must-carry channels must be negotiated” between the parties. “The authority’s decision is that it does not have a mandate to dictate costs related to must carry as the negotiable terms are of a commercial nature,” it said.

The SABC must offer its programming to satellite broadcasters like MultiChoice, within three months of the date of the conclusion “on commercially negotiable terms”.

Should the parties not conclude an agreement within three months, they can request an extension in writing from Icasa, which may grant an extension of up to 30 working days. If they still cannot reach an agreement, they must inform Icasa, which, in turn, may refer the matter to its complaints and compliance committee for resolution.

In the reasons document, Icasa also said that should there be a contractual deadlock between the parties during the negotiation, the 2008 must-carry obligations must continue “so as not to negatively impact consumers”  — a clause that could allow MultiChoice to continue broadcasting the SABC channels in the event of a breakdown in the commercial negotiations.

Soon after the Icasa hearings, in May 2018, MultiChoice Group CEO Calvo Mawela hit out at the SABC’s call for it to pay to carry its public service channels on DStv, saying it would not do so if the must-carry regulations were amended or scrapped. “I do not see the reason we should be paying for channels that are freely available.”

Asked for comment on the amended regulations, a spokesman for the pay-TV operator said on Friday that the new rules “reiterate the public interest intention of the must-carry rules: to give South Africans who watch television through a pay-TV service convenient access to SABC channels”.

MultiChoice is committed to negotiating commercial terms with the SABC in good faith

“The most significant amendment is that subscription broadcasters and the SABC must negotiate a new must-carry agreement on commercial terms. However, subscription broadcasters are not compelled to pay to carry the SABC channels. In most countries, the public broadcaster pays the subscription broadcaster a fee for carrying its channels.

“MultiChoice is committed to negotiating commercial terms with the SABC in good faith. We will continue to carry the SABC channels on the current terms until a new agreement is reached.”  — © 2022 NewsCentral Media