Telkom Media leads pay-TV newcomers

Johannesburg, 11 Jan 2008

Telkom Media is leading the new crop of commercial TV broadcasters, which are gearing up to commence operations this year.

Last year, the Independent Communications Authority of SA (ICASA) granted licences to four new pay-TV platform providers: Telkom Media, On Digital Media, e.sat and Walking on Water.

Since then, Telkom Media has published its first round of briefs for the production of local content, as well as a guide to its standard terms of trade for acquiring local content.

It has set four production proposal deadlines, starting on 28 January and ending 14 February. Telkom Media has also detailed its tariffs for producers. The company says it will conduct face-to-face briefings with producers on 28 January.

Telkom Media spokesman Chris van Zyl previously said the company's satellite services will begin in mid-2008, while broadband services will launch later in the year.

On Digital Media says it still plans to be on air with its new pay-TV offering in the second half of 2008, "once the new state-of-the-art technology has been set up in the country".

Representatives from Christian broadcaster Walking on Water were not available for comment at the time of publication.

Scaling down

Meanwhile, sister company e.sat is changing the scope of its operations, opting to launch its services on the DSTV platform rather than becoming a platform operator in its own right.

The company recently announced it would launch its satellite channels on the DSTV platform, with a 24-hour news channel as an initial offering.

CEO Marcel Golding explains: " is our strongest brand. When we decided to become a channel supplier instead of a platform operator, our biggest priority was to secure as wide a reach as possible for SA's first independent 24-hour news channel."

During the hearings on pay-TV held last year, e.sat argued the South African market could only sustain two pay-TV operators.

"When four pay-TV licences were issued in addition to the MultiChoice licence, e.sat decided to explore alternative opportunities as a content aggregator and channel supplier," says Golding.

It is not yet clear what the regulatory implications of this decision are, as ICASA's terms and conditions of issuing pay-TV licences require licensees to operate from their own platforms.

Legal challenge

Another potential legal problem may come from failed bidder Black Earth Communications (BEC), which, according to Business Report, is appealing ICASA's decision.

The report quotes CEO Kubeshnie Jones as saying: "BEC intends to point out to the courts what it sees as inconsistencies in the way the applications were assessed, errors in interpretation of the law and arbitrary behaviour on the part of the regulator."

However, ICASA's pay-TV licensing document indicates BEC's application was inadequate.

The applicant failed to demonstrate it had raised funding, and did not have letters of commitment from potential investors, ICASA said in the document. The company also failed to provide a clear view of BEC's shareholding and equity standing.

ICASA also slammed BEC's market research, which it said was inadequate; its business plan, which was said to be "over-optimistic"; and its financial plan, which ICASA alleged failed to cater for the impact of inflation.

Lastly, ICASA argued that BEC's application indicates the senior management members of the proposed company do not have relevant/broadcasting experience.

ICASA was unable to provide further comment, as the officers involved in the process are still away on leave.

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