Latest figures show that DStv has reported record subscriber numbers of 4.45 million out of a potential 10 million television households in SA.
Underdog Productions CEO Marc Schwinges says whoever is awarded a licence will find it difficult to compete with DStv.
Five companies are awaiting the outcome of the latest round of pay-TV licence applications.
The Independent Communications Authority of SA's (Icasa's) call for applications for subscription broadcasting licences, attracted very few applicants. The companies - Mobile TV, Close-T Broadcast Network, Siyaya TV and Mindset Media - presented their strategies at public hearings two weeks ago.
In the previous pay-TV hearings in 2007, five licences were awarded from a pool of more than 20 applicants. They were e.tv subsidiary e.Sat, Telkom Mobile, religious network Walking on Water-TV and On Digital Media (trading as TopTV). MultiChoice completed the complement of winning bidders with a licence conversion.
Telkom Mobile and Walking on Water-TV failed to take off. e.Sat also abandoned its plans for a fully-fledged pay-TV operation and sold a news channel to DStv instead.
Top TV launched in 2010 but is in business rescue after failing to attract the 300,000 subscribers it had projected by April.
"Over the years MultiChoice has entrenched itself to such a degree that it is almost impossible to compete," Schwinges says.
"When Top TV launched in 2010 DStv immediately drove down its pricing and introduced a R99 package which was never there before. It was a direct assault at Top TV's package. As a result, Top TV hasn't made any impact.''
Applicants would want to avoid Top TV's mistakes. However, Kagiso TV complained that the pay-TV market favours DStv.
CEO at Kagiso Media Yusuf Nabee voiced concern about the existing monopoly held by DStv for major sporting codes.
"There is a challenge regarding the tying up of premium content. Some of our concerns need to be dealt with in the long term."
Nabee was referring to MultiChoice's contracts for exclusive broadcast rights of Premier Soccer League (PSL), the English Premiership League, the Springboks and Super Rugby matches and cricket matches. Sport is a popular television content category and the three biggest sports in SA are soccer, cricket and rugby.
The Kagiso TV network is planning to broadcast 60 to 70 channels. However, Nabee would not elaborate on what its "unique" content would include, due to fears that MultiChoice would steal the ideas and eliminate any competition.
Siyaya TV, led by former SA Post Office CEO Vuyo Mahlati, has bypassed MultiChoice's monopoly and is in an arrangement with the Council of Southern African Football Associations, which will launch a new regional football league.
The 100% black-owned consortium, which includes talk show host Dali Tambo as one of its shareholders, says it will have exclusive rights to the new league.
Before her dismissal as communications minister, Dina Pule initiated a process where Icasa would review policy to encourage competition in the pay-TV sector.
This would include revising regulations related to long-term exclusive content to allow other broadcasters a chance to compete.
However, Icasa spokesman Paseka Maleka says the regulator is not working on any policy frameworks to address potential imbalances in the pay-TV market and has earmarked the issue for a possible regulatory review for next year. "The plan is to issue (new pay-TV) licences as soon as possible
"The former minister was preparing to issue a policy directive but if that doesn't come we will conduct an investigation into premium content, particularly sports rights. This, however, has only been prioritised for the 2014-15 financial year," he says.
Another applicant, the Mobile TV consortium, headed by chairman Mothobi Mutloatse intends to provide service for mobile devices such cellphones and tablets. It plans to roll out eight TV channels and four radio stations over a 27- month period.
Companies such as Mindset Media and Close-T are targeting niche market, education and the gay and lesbian community respectively. Mindset Media will be broadcasting a service made up exclusively of educational content targeted at public schools around the country.
Close-T is targeting the gay and lesbian community and has set up exclusive partnerships with global content providers such as OutTV group, LOGO TV and the OUT in Africa Film Festival.
Source: Business Day, via I-Net Bridge
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