Star Times, the new owners of South Africa’s TopTV pay television broadcaster, is facing a class action lawsuit in Uganda over the alleged “dumping” of old decoder technology in the market.
Mulwani Taminwa and Muzamir Kasamba, together with the Uganda Consumers Protection Awareness Association, have approached the commercial division of the High Court of Uganda in the capital city Kampala to gain compensation and to force the company to replace their soon-to-be-obsolete decoders for newer versions.
The nationals claimed they had been disadvantaged by Star Times and they were entitled to compensation for “intentionally being convinced to purchase outdated technology”, the plaintiffs said in the advertisement published in Ugandan media 11 days ago.
The plaintiffs have invited 66 000 subscribers listed in the advert and 65 000 other undisclosed customers to join the legal action.
This comes as Star Times prepares to sign a consulting agreement with On Digital Media (ODM), TopTV’s parent company, which will govern the strategic and operational input that the firm will provide to ODM, according to a report in the Sunday Times over the weekend.
Star Times is accused of selling decoders using technology that was condemned by the Ugandan Communications Commission, and which the commission instructed the company to stop selling in September last year.
The decoders operate on the Digital Video Broadcasting-Terrestrial 1 (DVB-T1) standard developed in Europe.
Uganda and other African countries, including South Africa, have adopted the next-generation DVB-T2 standard, following an International Telecommunications Union meeting in 2006 where it was decided that all countries in Europe, Africa and the Middle East should migrate from analogue to digital broadcasting services by 2015 to increase spectrum efficiency.
Richard Omongole of Omongole & Company Advocates, the firm that is representing the plaintiffs, did not respond to enquiries, neither did the Star Times in Uganda.
The Independent Communications Authority of South Africa and the Department of Trade and Industry were not able to respond before going to press about the processes in place for monitoring equipment that is imported into South Africa.
In March, shareholders of ODM – including the National Empowerment Fund and the Industrial Development Corporation – and creditors selected the Star Times bailout and restructuring offer over a bid from Dynamic TV Consortium, which was funded by ODM rival MultiChoice through its enterprise development programme.
However, as a foreign investor, Star Times can only own 20 percent of ODM, according to the Electronic Communications Act. ODM applied for a business rescue in October, two years after launching into the pay television market, which was dominated by MultiChoice.
Star Times, which operates in 16 African countries and has about 7 million subscribers in its home base China, has been active in Uganda since 2010.
On its Ugandan website, the company says that “based on the principles of ‘consolidated plan and construction by phase’, Star will gradually build up a wireless digital TV platform based on DVB-T technology”.
Investment in the project was expected to exceed $40 million (R407m), the company said.