BUSINESS TECHNOLOGY MEDIA COMPANY
Companies
Sectors

MultiChoice schools ICASA on streaming market reality

Read time 4min 10sec
Comments (0)

Video entertainment company MultiChoice has urged the Independent Communications Authority of South Africa (ICASA) to be cognisant of the market realities brought about by streaming and over-the-top (OTT) players in its probe of broadcasting signal distribution services.

MultiChoice made the remarks in its submission to the telecoms regulator’s discussion document on signal distribution services, in accordance with section 4(6) of the Electronic Communications Act (ECA), 2005.

The regulator will hold virtual public hearings in respect of the discussion document on 19 August.

This follows the publication of the notice of intention to conduct a market inquiry into signal distribution services in SA by the authority on 17 September 2021.

ICASA subsequently published a discussion document on the Market Inquiry into Signal Distribution Services in South Africa on 22 April 2022.

The purpose of the inquiry is to assess the state of competition in the signal distribution market and determine whether there are markets or market segments within the signal distribution services value chain that may warrant regulatory intervention in terms of section 67(4) of the ECA.

According to ICASA, signal distribution is an essential electronic communications network service that transports radio and television programmes created by broadcasting licensees to the actual broadcast target area, allowing listeners and viewers to hear or watch those programmes on radio or television.

“The hearings are an important step in the market inquiry process. This process is expected to help the authority better understand the competition dynamics and challenges in the signal distribution services markets, as highlighted by some stakeholders,” says councillor Yolisa Kedama.

By the deadline of 29 June, ICASA had received written submissions from eMedia, MultiChoice, Primedia, Radio Pulpit, SABC and Sentech.

In its submission, MultiChoice says in paragraph 3.5 of the discussion document, ICASA refers to streaming services as alternative technology platforms and concludes that these are not considered as signal distribution services.

It explains that streaming/OTT services are retail services supplied to end consumers in competition with retail services of traditional broadcasters.

“We agree that these streaming/OTT services are not signal distribution, but it is important to note that they are delivered to consumers via the internet, which is the delivery mechanism,” says Thabo Makenete, general manager of technical regulatory at MultiChoice.

“The alternative to traditional signal distribution is thus not the streaming/OTT services themselves, but the internet which is used to deliver the services to consumers,” he adds.

Bypassing Sentech

Makenete submits to ICASA that the use of the internet as a delivery mechanism for audio-visual services (both for traditional services and those of new streaming services) is viable, has become more established and ubiquitous and will, on a forward-looking basis, become more entrenched.

“As such, characterising internet delivery of audio-visual services in the manner done in paragraph 3.5 ignores market reality. As things stand, there is ample evidence that retailers of audio-visual services have the option of delivering their services to consumers via the internet rather than having to use traditional signal distributors such as Sentech.”

MultiChoice’s calls come as the company is facing stiff competition from international video streaming giants such as Netflix, Disney+ and Amazon Prime Video, among others.

As the heat from OTT services intensified, MultiChoice previously called for the regulation of the new streaming services in South Africa.

“It is also important to highlight that for other delivery technologies to constitute an alternative, they do not have to have 100% or the same penetration levels, as suggested in paragraph 3.10.1.2 of the discussion document,” Makenete notes.

“It is apparent from a cursory observation of the rapid developments in the audio-visual services market that the internet is a viable alternative mechanism for delivering audio-visual services to consumers.”

He points out that large global OTT services have launched and expanded rapidly in SA, while local OTT services and traditional broadcasters are delivering their own services to consumers via the internet.

“This is in part because of declining data prices, increasing access to the internet and the proliferation of internet-capable devices. The trends can only deepen on a forward-looking basis.

“It is common-cause that, on a forward-looking basis, the use of the internet as a means to provide audio-visual services to consumers will only become more entrenched. As a result, reliance on traditional forms of delivery (traditional signal distribution services) is going to become less and less important.

“In fact, OTT services have no need at all for traditional signal distribution services provided by the likes of Sentech,” Makenete.

Login with
13 Aug
Be the first to comment
See also