South African regulator calls for MultiChoice sports monopoly to end
The Independent Communications Authority of South Africa, Icasa, has called for new regulations to be introduced into the country's pay-TV market, in an attempt to reduce monopolisation by MultiChoice, South Africa’s dominant pay-TV operator, and increase competition for broadcast rights.
MultiChoice owns DStv, the satellite service provider for much of sub-Saharan Africa, and has exclusive long-term contracts to premium sporting competitions and leagues such as soccer’s English Premier League, Spanish LaLiga and Uefa Champions League.
SuperSport, carried on the DStv platform, also has exclusive rights to much of the international rugby and cricket broadcast in South Africa.
In the draft version of a report written by Icasa following an enquiry, instigated in 2016, into subscription television broadcasting services, the authority said: “These (the sporting competitions listed above) are the most popular competitions in SA… these sports rights are held by MultiChoice and this is considered to be its competitive advantage.”
The report found that rights for top-tier sporting leagues and events were now “beyond the reach of many broadcasters and new, smaller local OTT [over-the-top] service providers”, and gave several recent examples of other broadcasters losing properties to MultiChoice and SuperSport, because of the prohibitive cost.
The country’s public service broadcaster, SABC, lost its exclusive Premier League rights to SuperSport in 2007, which meant SABC “lost viewers as a result of failing to secure these premium sports rights”, the report said.
The report added: “Effectively no new entrant will have access to these and other rights currently held by MultiChoice.”
The report also drew attention to the length of broadcasting contracts now given out for sporting events, noting that such contracts are usually long-term.
Icasa is apparently considering introducing rights splitting, and unbundling some of the premium sports properties that MultiChoice currently exclusively holds. It also stated that a claim made by MultiChoice, that introducing further regulations would simply hand the South African market to streaming giants such as Netflix, was not "borne out by the evidence."
Icasa pointed out that all its analysis showed that South African viewers tended to take out OTT streaming subscriptions to complement, rather than replace, TV services.
There will be opposition to the Icasa report from South African sporting bodies, reluctant to give up the lucrative long-term contracts that they know MultiChoice will offer. In February, the South African Football Association became the latest entity in the country to speak out against planned legislation that would ensure more sports events are televised on a free-to-air basis.
The regulator launched a draft bill in January that would ensure more sporting events are shown on FTA.
Icasa listed many popular sporting events which must be broadcast live by a free-to-air service such as SABC. These included the summer Olympic Games and World Cups in soccer, rugby union and cricket.
SABC would in all likelihood have been the main beneficiary, but Safa disagreed strongly with the idea, saying: “It is common knowledge that sporting federations in South Africa and the world at large, rely on the sale of their broadcast rights to broadcasters, to help sustain their development programs and unfunded projects for the growth of the sport – and Safa is no different in this respect."
Another complication is that SABC is in extremely poor financial health. The broadcaster is involved in a long-running dispute with Safa over the value of national team rights.