Tag: TV licence

Goodbye TV licence, hello ‘household levy’

By Khulekani Magubane for News24

The South African Broadcasting Corporation (SABC) has told the Department of Communications that the SABC bill approved by Cabinet earlier this year needed to “redefine” the television licence regime to put the public service broadcaster on a better footing when it comes to drawing revenue.

The SABC was making submissions to public hearings by the Department of Communications on Monday. The broadcaster recommended a “household levy system” based on the possibility of access to SABC services – rather than actual usage of its services.

The SABC also called for a “pro-competitive measure and regulatory obligation” where “the dominant subscription broadcaster”, i.e. MultiChoice, would be required to collect the public broadcasting household levy from its subscribers on the state-owned broadcaster’s behalf.

The SABC has been working through financial challenges for the better part of a decade and the difficulty it has experienced in collecting television licence fees adds to its already strenuous money troubles.

In its submission, the SABC said the bill also does not provide for further government grant funding for public interest programming. As such, the bill – which was approved by Cabinet in July – does not secure the financial sustainability of the SABC.

“Unfortunately, the SABC Bill retains the outdated TV licence system and does not take into account the SABC’s view that it should be replaced by a technology neutral, public broadcasting household levy that would exempt the indigent and should be part-collected by the dominant pay TV operator,” the SABC said.

The SABC reiterated that the current TV licence system should be scrapped and replaced with a “public broadcasting household levy”.

“The SABC submits that this entire section from the bill is required to be deleted and redrafted to take into account the SABC’s submissions on the introduction of a public broadcasting household levy,” said the SABC.

The broadcaster said it was concerned that the bill retained the TV licence fee regime which is tied to television sets, despite the proposal made by SABC for a complete change. Linking a levy to devices is administratively burdensome and cannot be future-proofed, the submission added.

“As such, a new model of defining a technology-neutral, public broadcasting household levy has been recommended in order to secure a stable revenue source for the SABC’s public service mandate,” the submission said.

The SABC submits that South Africa follow the device-independent German model, while adding our own particular South African market requirements on collection, enforcement and exemptions.

“The SABC recommends that a household levy system based on the possibility of access to SABC services – rather than usage – should be implemented,” the submission said.

The broadcaster said the German household levy model was implemented in 2013 and reaffirmed as constitutional in 2018 by that country’s Federal Constitutional Court.

“The SABC reiterates its submission on that – as a pro-competitive measure and regulatory obligation – the dominant subscription broadcaster should be required to collect the public broadcasting household levy from its subscribers,” the SABC said.

The SABC said that the SABC Bill should be informed by the Draft White Paper for Audio Audiovisual Content Services and the “recommended approach” will create policy certainty and save both the policymaker and stakeholders’ costs of participation in this legislation development process.

“If the Broadcasting Act is repealed by an SABC Act, in isolation of the general policy process, the DCDT would have to amend the SABC Act once the general policy process is completed. In the interests of expediting a harmonised policy process, the SABC has prepared comments on the SABC Bill as gazetted,” the broadcaster said.

The SABC thanked the department for the opportunity to submit written representations and said that it looked forward to further engagement on the finalisation of the audio audiovisual content services policy and the development of industry legislation.

 

By Dan Meyer for The South African

Broadcasting giant MultiChoice has indicated its support over proposed measures to save the embattled South African Broadcasting Commission (SABC), who plan to implement a R265 yearly licensing fee to all South African households able to view their content.

The controversial plan would essentially see any household with access to a tv, laptop, smart phone or tablet charged an annual levy that the broadcaster hopes will salvage them from the financial distress they currently find themselves in. This would replace the existing TV Licence structure.

South Africans have reacted angrily to the notion that they should have to pay for the errors made by the SABC’s management over the years, even if they simply have access to the broadcaster’s content and choose not to watch anything it has to offer. The Democratic Alliance (DA) have called the proposed levy a “stealth bailout” and categorically opposed it. The measure would supposedly generate around R2 billion a year for the SABC.

The SABC submitted a 40-page document to the Department of Communications last week in which they detail the proposed levy and its collection system, saying that it should replace the current TV Licence structure.

“Essentially, the SABC submits that the public broadcasting levy should become a device-independent levy on all households that have the possibility of access[ing] public broadcasting content whether via the internet, mobile, analogue or any digital broadcasting platforms, with exemptions for indigent households and discounts for pensioners and other designated persons,” they said, adding that the the collection of the licence fee from subscribers, per household, is “not an onerous requirement from a systems point of view, noting it amounts to 72c a day based on the current licence fee”.

MultiChoice said on Tuesday that the proposal would eradicate the “outdated” TV licence model that they believe is not on in line with “international best practice”.

The broadcaster said that it is in favour of a “more effective, ring-fenced public broadcasting levy”, and suggested that this should preferably be collected by the South African Revenue Service (SARS).

They’re endorsement of the proposal is the polar opposite of they’re appraisal of the plan offered just last week, when they suggested that the plan is unfeasible and “not worthy of any serious consideration”.

The endorsement follows the latest round of retrenchments effected at the SABC, who confirmed the dismissal of 12 SABC radio station managers on Monday 8 March, with the company now initiating a revised structure for its radio titles that will see certain stations clustered together in various “combos”.

Vuyo Mthembu, SABC spokesperson, said that within the new structure, marketing managers will be reporting directly to corporate affairs and marketing departments “to ensure efficiency in the delivery of the organisation’s marketing objectives”.

“Furthermore, station managers are now called business managers as this will ensure that business managers of each station take full ownership of the profit and loss responsibility, drive revenue and listenership growth whilst fulfilling the SABC’s mandate of informing, educating and entertaining South Africans,” he said.

 

Source: MyBroadband

Communications Minister Stella Ndabeni-Abrahams has doubled down on the government’s plan to charge people with computers, smartphones, and tablets TV licence fees.

This was part of a response from Ndabeni-Abrahams to a question from the DA deputy chief whip in the National Assembly, Michael Waters.

Waters asked the Minister of Communications and Digital Technologies:

What is the justification of (a) charging persons with mobile devices the cost of a TV licence and (b) transferring all the income of TV licences derived from mobile devices to the SABC?

In response, Ndabeni-Abrahams cited sections of the recently published “Draft White Paper on Audio and Audio-Visual Content Services Policy Framework: A New Vision for South Africa 2020”.

She said amendments to the TV licence fee section to broaden the definition and collection system for television licences are necessary because of the SABC’s financial challenges.

There are also plans to strengthen enforcement mechanisms and penalties of non-payment of TV licenses.

She added that “achievement of the above will be determined by the submissions expected from all South Africans towards the draft White Paper”.

What Ndabeni-Abrahams is referring to is the public comment process related to the Draft White Paper which closes on 15 February 2021.

Ndabeni-Abrahams’s response did not sit well with DA Shadow Minister of Communications Zakhele Mbhele.

Mbhele said Ndabeni-Abrahams did not “properly justify” government’s intention of charging people with mobile devices the cost of a TV licence and giving the money to the SABC.

“This draft paper proposes to exploit another stream of revenue to bail out yet another state entity brought to its knees by years of gross mismanagement,” he said.

“And it seems the Minister knows that this is not justifiable, given her poor attempt at answering the question.”

Mbhele added that it is the same White Paper that seeks to extend TV licence fees to include streaming services like Netflix, regardless of whether such a service is viewed on a television.

He urged the public to make written submissions opposing the Draft White Paper’s plan broaden the definition and collection system for TV licences.

The DA has also launched a petition against the government’s plan to force people to pay for a TV licence to stream Netflix or watch DStv.

“You should not have to pay a cent more to keep the SABC afloat,” the DA said.

Only 30% of people pay TV licence fees

By Sihle Mlambo for IOL

The SABC would be commercially viable and would receive an immediate cash injection of up to R2bn per year if everyone paid their TV licence fee.

This is according to the public broadcaster’s chief operations officer Ian Plaatjes, who was speaking to IOL in a wide ranging interview on Friday.

Plaatjes said only 30% of TV licence holders were compliant and that had substantially affected the public broadcaster’s funding model.

“Our TV Licence is R265 per year and we have 30% of people paying, so we have a default rate of 70%.

“As you know the organisation’s funding model is through TV licence fees as well as advertising revenue, so we are not government funded, we are very dependent on that.

“If everybody was paying their TV licence, we certainly would be a financially stable and viable organisation, but that isn’t the case,” said Plaatjes.

The public broadcaster also lost a lot of money in advertising revenue during the peak Covid-19 and has only started to show promising signs recently.

He said advertising revenue plunged between 70% to 80% during hard lockdown months.

Plaatjes said the organisation was entering into a Section 189 retrenchment process which would see 400 jobs on the line as part of the SABC’s bid to save about R700m per year for the next three years.

Management at the SABC have also said they will freeze salary increments for the next three years, abandon the company’s leave encashment policy and have also reviewed annual leave and sick leave policies.

Plaatjes also said the public broadcaster would be making a push to utilise DSTV as a TV licence revenue collection stream, while also clarifying that they will not be doing the same with international streaming services such as Netflix.

“We have said that we expect DSTV to collect television licence fees on our behalf, they have about 10 million subscribers and if those subscribers do not pay their fee, they can cut them off immediately.

“Some of those subscribers (on DSTV) do not have a TV licence, so we are saying they can collect those TV licence fees on our behalf,” said Plaatjes.

“(Unpaid TV licence fees account for) about R2bn per year, we would be financially stable and viable immediately, so, if you compare ourselves with the BBC (in the UK), which is completely funded through their TV licence, their fee is over R3000 per year and they have nearly 100% collection rate, so it makes a huge difference.

“All that money can be redirected to content and we can have fresher, newer content and also additional content as well,” said Plaatjes.

Meanwhile, he said the public broadcaster had developed a new target operating model which was geared at cashing in on digitisation of the sector.

On Monday, the Telkom streaming service went live with SABC content.

“With our new target operating model, we have identified additional revenue drivers, one of it being carriage licences, like the deal we have just concluded with Telkom which went live on Monday.

“What that does to our revenue is it gives us two additional revenue streams that we never had before, we get a licence (fee) for our channels and we will be able to share in the revenue on the Telkom platform.

“This is not an exclusive deal with Telkom, so we intend to do this deal with other telecommunication companies as well, and so, those will be other additional revenue.

“That is over and above what we have projected in turning the organisation around, so it is huge,” he said.

With the SABC still stuck on analogue, Plaatjes said it was critical to the SABC’s viability that the public broadcaster moved to digital in the next five years.

He said if the public broadcaster was able to offer direct-to-home (DTH) services with a set-top box, that would enable the SABC to have its own dedicated sports, health, education and channels aimed at the marginalised language groups.

Thriving SABC

Asked what a thriving SABC looked like in the next five years, Plaatjes said: “In a best case scenario, we will be in a multi-platform and multi-channel environment.

“Right now we are on analogue, we need to migrate to a digital platform. There’s currently two platforms available, DTT (digital terrestrial television) and DTH.

“The current legislation forces us to a DTT platform, but in five years time that cannot be the case because it is unsustainable in terms of the cost of it being too high.

“In five years time we will have more people on DTH, which is completely interoperable because you can be anywhere in the country and you will be able to be connected via DTH if you have a set-top box.

“But if I have a DTT box, and I move into an area which does not have DTT coverage, it is not interoperable, I have to buy a new box.

“We cannot grow our channels right now because we are on analogue, but on digital, we can have multiple channels and grow the industry through that, and by then we will have our own OTT (over-the-top) platforms, we will have our own OTT platform in the next couple of years,” said Plaatjes.

Grim

As much as Plaatjes said the SABC was ready to go with digitisation, the matter was beyond them.

“The future of our destiny is not in our own hands. With digitisation, we are ready right now, but that requires a set-top box.

“But the roll-out of the set-top box is not determined by us, the manufacturing of it, the setting up of it, the installation and the managing of it afterwards, is outside of our control (it is with the preserve of the Department of Communications).

“So if that is not rolled out, then in five years time, worst case scenario, we will still not be off analogue,” he said.

He added: “There is no stumbling block from our side, all we need is a set-top box, because the infrastructure is there.

“There are 4.5 million households right now that do not have digital TV, so they are still on analogue.

“If you go provide them with a DTH set-top box right now, they will be able to connect.”

 

By Jamie McKane for MyBroadband

The South African Broadcasting Corporation (SABC) has proposed that regulation be implemented to expand the definition of a TV licence to include services such as Netflix.

In a presentation to Parliament’s Portfolio Committee on Communications presented by Deputy Communications Minister Pinky Kekana, the public broadcaster has argued the expanded definition of a TV licence is outdated and needs to be adjusted to current realities.

The SABC said that regulation is needed which would require pay-TV service providers like MultiChoice (DStv) and video on demand providers like Netflix to collect TV licences on behalf of the SABC.

It added that this would be similar to municipalities collecting traffic fines and motor vehicle licence discs.

Kekana said during the presentation that the government’s proposal to help the SABC improve its financial position would include allowing the public broadcaster to collect licence fees from non-TV users.

“Including engaging with those who have been carrying the SABC programmes on their pay-TV, how do we through ICASA make sure that they too are able to assist us to collect TV licences?” Kekana said.

“But we are not only limiting it to TV. We also have other platforms where people consume content and in all of those areas, that is where we should look at how we are able to get SABC licence fees from those gadgets.”

This means that the SABC wants users who watch content on devices such as laptops and smartphones to also pay licence fees.

Sports rights
The SABC has also called for improved access to national sports rights – specifically, it wants access to these broadcast rights at an improved rate.

The SABC argued that national sports must be made available to it at “a very affordable price”.

Another point in the presentation to Parliament was the proposed removal of the must-carry rule for the SABC, which requires that all subscription broadcasters with more than 30 channels must carry the SABC’s three free-to-air television channels.

However, current regulations state the SABC “must offer its television programmes, at no cost,” to subscription broadcasters instead of allowing commercial negotiations between the parties.

The SABC said that it instead wants to negotiate with pay-TV providers to pay for these channels as it noted that the current regulations meant the deal was “one-sided” in favour of Multichoice.

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