The rand-dollar exchange rate could have a strong impact on the final cost of set-top boxes (STBs), the devices needed to convert digital signals for viewing on analogue TV sets, experts say.
In turn, this could affect the final price and the government subsidy needed to help the poorest segments of the population obtain the STBs so they are ready for when the analogue signal is finally switched off in November 2011.
Global financial market turmoil has adversely affected the rand, which has tumbled 23.6% over the past month to its current level of R10.18/$.
A subsidy to pay up to 70% of an expected final cost of R700 per STB has been agreed to by government. This means its spending on the entire digital TV migration over the next three years will amount to R5 billion. The losses on the currency market could necessitate an increase in that amount.
Paying in dollars
Aynon Doyle, MIH Group regulatory affairs manager, says the components needed to assemble the STBs are not manufactured in SA and are priced in dollars.
"We will have to wait and see what the currency does going forward, before any adjustments to the final price are made," he says.
Bennie Langenhoven, a director of electronics manufacturing company Tellumat, says components such as chipsets, integrated circuits and other parts will be affected by the currency.
"We may be able to manufacture items such as the covers here in SA, but we are still awaiting the final specifications to be issued, before making a final decision," he notes.
Doyle says the SA Bureau of Standards sub-committee that has drawn up the STB standards has finished its work and sent its recommendation to the bureau`s main committee, which is called TC 74.
"TC 74 has until 7 November to make its final input and then the standards will be issued for public comment over December and January. Depending on how much comment is received, the final specifications will be issued in February or March."
Doyle points out that the standard will be voluntary, but that most manufacturers will probably follow it.
Langenhoven and Doyle both say the currency exchange rate will play a key role and final pricing will only be determined once some stability has returned to the rand exchange rate.
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