Set-top box debate full of absurdity
Cabinet’s decision is in the interest of SA
THERE has been a lot of debate in these pages in the past few weeks about whether Communications Minister Yunus Carrim has done the right thing when it comes to South Africa’s new broadcasting policy.
To back up a bit, perhaps we should explain what this debate means for ordinary South Africans.
At present, televisions in South Africa receive analogue broadcast signals. As part of the “digital migration” that is taking place across the world, all South Africans will soon need a set-top box or decoder to convert the digital signal to an analogue format so that existing televisions work.
There are many benefits to this digital migration. For example, it will free up urgently needed radio frequency spectrum, which can then be used for mobile broadband. It will also lower the cost of communications, create new jobs and allow for more TV channels to be streamed, at better quality and in indigenous languages.
There has been a public battle waged between opposing broadcasters about whether the set-top boxes should be manufactured with an internal control system or not.
On the one hand, some groups do notwant a control system in the new boxes because they say it would be more expensive.
Other groups, however, believe we do need a control system because this will provide proper quality control and stop dodgy imports from flooding into the market.
In 2008, the cabinet decided that the set-top boxes should have an internal control system, partly because it would allow for other functions, such as e-government messaging, and would stimulate our local electronics industry.
But because the factions are so fiercely divided about the issue, the cabinet decided in December that broadcasters would be free to decide whether they wanted to use a control system or not. Those who want to use the system will also pay for it.
This seemed a sound compromise: the system is in the box, should the broadcasters choose to use it, but there is no obligation to do this.
So it is absolutely untrue, as Keith Thabo and Vijay Panday of the Na- tional Association of Manufacturers in Electronic Components argued in the Sunday Times on April 6, that broadcasters — including smaller community broadcasters — would be forced to use the control system.
Their claim that their channels “could become unaffordable or inaccessible” is absurd. Why would the Department of Communications do anything stupid like that, which goes against our mandate?
The bottom line is that viewers will have full and free access to all free-to-air broadcasting — even if any broadcaster decides to use the control system.
After all, the advantage of these “hybrid” set-top boxes is that they will receive the signals of both the broadcasters who use the control system and those who do not.
Tanzania, Malawi and Namibia are already using such a “hybrid” set-top box. Mauritius, however, did not go for any set-top box control and has been flooded with cheap imported converters that do not function adequately.
We did consider dropping the control system for the set-top boxes, but the South African Bureau of Standards said it would take 34 weeks to change the standard, even if there was consensus among stakeholders. And if there was a dispute, it would take more than 60 weeks. This route would also have opened us up to broadcasters who want the control system taking us to court.
The fact is, we are already so far behind schedule in our digital migration that this was untenable.
Contrary to the association’s criticism, the department is committed to ensuring that emerging black manufacturers benefit from the production of the set-top boxes. But we cannot support the narrow interests of one section of emerging black entrepreneurs, which is essentially the demand they made in this newspaper two weeks ago.
Carrim has explained to these association leaders that it would be illegal to favour them by abandoning controls. Anyway, the majority of black emerging entrepreneurs we have spoken to — who include several association members — support the very set-top box control system these leaders are arguing against.
The association’s leaders argue that because there are import duties, South Africa is unlikely to be flooded with inferior-quality imported set-top boxes if we abandoned the control system. But the 15% duty is relatively small and hardly adequate to protect us from a flood of cheap imports.
There is also this strange suggestion that Carrim is somehow pushing through a new policy.
The truth is, set-top box control has been government policy since 2008, five years before he was appointed in July last year. Then in June 2012, all stakeholders, including MultiChoice, agreed with the new control system standard.
But since those amendments don’t meet the narrow business needs of these Namec leaders, they now insist the whole process be simply ignored. Together with MultiChoice, they now criticise Minister Carrim personally, as if he alone subjectively decided on cabinet’s decision.
If the policy is so wrong, why would the industry regulator, Icasa, fully support it, as have major black business organisations? Why does the association seem far from united under its leadership’s positions?
Sections of the association are known to be very close to MultiChoice, with views that are apparently indistinguishable — despite having very different mandates, you would imagine.
If these association leaders are actually serious about black empowerment, why are they not focusing on MultiChoice’s 98% monopoly on pay television?
Why are they, instead, opposing the ANC’s Mangaung resolutions on competition in the pay-TV sector?
Could it be because some of these association leaders have a direct business interest in manufacturing set-top boxes without a control system and now expect the government to mould its policy to suit them?
We cannot do that. We have to act in the best interests of South Africa as a whole, particularly the poor and disadvantaged. This includes broadbased black economic empowerment, not the narrow interests of certain black business leaders.
Qoza is the spokesman for Communications Minister Yunus Carrim that has meant slashing incentives paid to the channel, including independent service providers. The carnage this is causing is now evident.
One has to wonder what happens now to Autopage Cellular, which will soon be the last remaining independent of nearly two dozen originally licensed by Vodacom and MTN. All Altron will say is that it is in a closed period and can’t make any statements about Autopage’s performance.
The group will publish its 2014 financial results on May 14. We’ll know then whether it is managing, somehow, to weather the storm.
The present state of affairs has been coming for some time. For many years, Vodacom and MTN were able to avoid a damaging price war. There was an unwritten rule, it seemed, that they wouldn’t go nuclear with each other on price. The industry prospered, allowing the operators to stuff their distribution channels with incentives. Investors reaped the rewards. Indeed, it was a virtuous cycle for everyone except consumers, who had to swallow high prices.