Multichoice hits back over SABC deal
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Johannesburg - Pay-TV operator Multichoice has hit back in the legal tussle over a deal it struck with the SABC for rights to its 24-hour news and an entertainment channel, denying it has in the process acquired control over the public broadcaster’s vast archive or its broadcasting policy.
Multichoice filed papers this week with the Competition Tribunal in response to an application by Caxton media group, Media Monitoring Africa and the SOS: Support Public Broadcasting Coalition, who alleged the agreement constituted a merger.
This was because the “commercial and master channel distribution agreement” signed in July 2013 handed to Multichoice a significant element of control over the SABC archive by obliging the SABC to submit its proposals for the entertainment channel, comprised largely of archive material, to Multichoice for its approval.
Caxton alleged since Multichoice would have exclusive rights to this channel, which not even the SABC could rebroadcast or licence for others to broadcast, and all material used in it, this would deprive competitors to Multichoice of the ability to use the archive material on rival channels.
South Africa’s imminent migration to digital terrestrial broadcasting – which allows the signal to be compressed to save “space” in the radio frequency spectrum – will make it possible for many more channels to be broadcast without significant additional costs.
The SABC alone is expected to expand its offering to as many as 18 channels.
Caxton and its fellow applicants argued the SABC and other free-to-air broadcasters, as well as would-be pay-TV broadcasters, could have used the SABC archive to create new channels relatively cheaply – were it not for the agreement with Multichoice.
But Multichoice chief executive officer Imtiaz Patel argues in his answering affidavit that the SABC retains the right to determine what programmes from its archive to include in the entertainment channel and may refuse to include specific programmes or material should it wish to use these for a channel of its own or licence the rights to others.
Given the size of the archive (comprising 40 years’ worth of material), Patel argues the material for the entertainment channel amounts to only about 1 percent of the whole.
On this basis, he denies Multichoice has acquired control over a part of the SABC’s business in the form of its archive.
Patel also denies the SABC changed its position on the question of set-top box control as a result of the agreement, saying the public broadcaster’s position had changed more than once over time, starting with its opposition to encryption in 2008.
He argues that the agreement does not prevent the SABC from supporting encryption, although it does bind the public broadcaster to ensure its free-to-air channels will not be encrypted and can be received by subscribers to Multichoice’s terrestrial broadcasting subsidiary M-Net.
Should the government’s current digital migration policy – which excludes the possibility of encryption – withstand a court challenge by e.tv, five million government sponsored set-top boxes will be manufactured without the ability to receive an encrypted signal, effectively slamming the door on this option for free-to-air broadcasters like the SABC and e.tv.