South Africa’s increasingly vocal and active citizenry has another corporate in its sights: This time it’s MultiChoice and DStv, hosts of the ANN7 news channel, previously owned by the Gupta family, and now run by Gupta friend and associate, Mzwanele Manyi.
From public petitions to private Facebook posts, Twitter campaigns and columns in newspapers and online, in the same way that they brought down Gupta-aligned PR agency Bell Pottinger, South African civil society organisations and individuals are on a campaign to force MultiChoice to fire ANN7. Subscriptions are being cancelled, and social media is awash with commentary that is undoubtedly doing MultiChoice’s reputation massive harm.
News24, in an expose resulting from the Gupta Leaks, found MultiChoice had made a “questionable payment of R25 million to the Gupta’s controversial ANN7 channel”. Also, it said in the story, MultiChoice increased its annual payment to ANN7 from R50 million to R141 million.
“The payments came after the family seemingly assisted former communications minister Faith Muthambi in getting President Jacob Zuma to transfer certain broadcasting powers to her, something MultiChoice was lobbying the minister for,” the online news operation, also owned by Naspers, said in its story. Shortly afterwards, Muthambi – despite opposition from her own party and its alliance partners – pushed through a decision favouring unencrypted set-top boxes. This is a key issue in the rollout of Digital Terrestrial Television, now nearly three years late.
“It would appear that not only did the Guptas get what they wanted in the launch of their own news channel ANN7, which was rewarded with lucrative annual payments from MultiChoice to the tune of R140m, but MultiChoice appears to have also benefitted through transactions involving the [former minister Faith Muthambi] Minister of Communications’ cancellation of the roll-out of a competitive encryption service for all TV platforms,” the Organisation for Undoing Tax Abuse (Outa) said in a statement.
The STB issue continues, with e.tv recently scoring a victory over the Muthambi proclamation.
Free speech or propaganda?
OUTA has been driving a campaign to shame MultiChoice into firing ANN7, or at least not renew its contract in April 2018. But it has also been criticised by citizens and free speech campaigners who believe one can choose not to tune in to ANN7’s particular brand of news but that diversity of voices in media is needed in South Africa.
CEO of OUTA, Wayne Duvenage, responded in a press statement, “We are fully aware of the need for a free media and the necessity for society to benefit from multiple voices representing various opinions and positions in the news. The fact is that without the support of taxpayers’ funds for ANN7, channelled to them through questionable transactions with various state-owned institutions, this broadcaster might never have existed in the first place. Their biased reporting in support of the corrupt element of leadership merely adds fuel to the fire of disdain and disgust at their conduct.”
It’s a view shared by vocal CEO activist Magda Wierzycka, who, writing for Business Day, said: “Normally, calling for the broadcasting of anything to be terminated, as I have done with ANN7, could be classified as endorsing censorship. Having grown up in a communist state, where censorship was the order of the day, and then moving to an SA that was still muzzled by apartheid, I, more than most, appreciate the value of freedom of speech. Hence, I had to think hard about my motivations,” she said.
Wierzycka said much she disagreed with the “biased, low-quality reporting of ANN7, with its clear political agenda” its content didn’t inform her objection to MultiChoice including ANN7 in her DStv bouquet. “I disagree with the views expressed by Fox News as well. My call for removing ANN7 from DStv had little to do with content.”
MultiChoice, she said, enjoyed a monopoly over the broadcasting of many channels that South Africans enjoy, particularly sport. Viewers have no other options, she said. For the majority, streaming of content online, “given the exorbitant data costs and poor Internet connectivity, is not yet a mainstream alternative”.
Gupta version of the truth
“ANN7 was set up by the Gupta family for the purpose of spreading their version of the truth. I have always assumed that, given the low viewership numbers and poor-quality production, the Guptas were funding the project themselves, paying MultiChoice for hosting the channel. As such, I could live with the fact that I never had to switch to ANN7.
“Imagine my horror when the Gupta leaks revealed that far from ANN7 paying MultiChoice, in fact MultiChoice has been paying ANN7, and by extension the Guptas, R50 million a year. That R50 million came from the pockets of South Africans who have unknowingly been funding ANN7. When presented with a new set of facts, one needs to re-evaluate one’s assumptions. I personally refuse to support any Gupta-related project. I object in the strongest possible terms to the agreement between MultiChoice and ANN7,” she wrote.
But MultiChoice has defended its deal with ANN7. Director of corporate communications, Jackie Rakitla, said the company had noted “speculation” around the contract.
“While we understand that some people may not be aware of it, it is standard practice to pay for mainstream news channels – particularly for local 24-hour news channels,” he told The Media Online. “The fee structure for the ANN7 contract is in line with the costs of developing and running such a channel, and ANN7 is definitely not the highest-paid local news channel on the DStv platform.” Rakitla said the R25-million fee referred to in the articles “is also not unusual”.
Reacting to claims that it communicated with Muthambi over the issue of encryption, or not, of set-top boxes, Rakitla said this was “standard practice” and that companies to interacted with the industry regulator and government on policy matters. “There is nothing wrong with that,” he said.
Rakitla said MultiChoice’s “interaction” with Muthambi related to President Jacob Zuma’s presidential proclamation in which he split the broadcasting and telecommunications ministries, giving each sector its own minister. “Unfortunately, the Presidential Proclamation creating these two new ministries did not make sense to a number of stakeholders in the broadcasting sector,” Rakitla explained.
President Zuma’s presidential proclamation
“Control over broadcasting was split between the two ministries. Several of these stakeholders made submissions to then-Minister suggesting it be corrected. MultiChoice was one of these. MultiChoice has no knowledge whatsoever of the Minister sending our proposals to any other person, and can in no way be held responsible for that,” Rakitla said.
He reiterated that there was “absolutely no relationship between our interaction with the minister, the channel supply agreement for ANN7, and any fees or increase in fees paid for that channel”.
It’s not a distinction the public is prepared to embrace. Calls for MultiChoice to dump ANN7 are becoming increasingly louder, and MultiChoice faces the same kind of loss of reputation as Bell Pottinger, KPMG, SAP and various other companies have suffered from their often-dubious relationships with the Gupta family and its companies.
MultiChoice is caught between a rock and a very hard place. Rakitla said DStv relays many local and international news channels, and that they have no editorial control over content or operations at the channels, including ANN7.
“We confirm that we have a legally binding channel carriage contract for the ANN7 channel,” he said. He could not confirm stories that MultiChoice would not renew its contract next year either. “We cannot comment on the terms of the contract (including the duration of the agreement) as it is subject to confidentiality clauses,” he said.
And he added, “We are furthermore unable to cancel a contract prior to its expiry unless there is a clear breach of that contract.”
But Rakitla said MultiChoice had not been approached by the owners (Manyi) for renewal of that contract “and we are not in negotiations for the renewal of that contract. Timelines for negotiations for the renewal of contracts vary from contract to contract and are dictated by different situations and circumstances”.
The Democratic Alliance has now called on MultiChoice to come clean with the contracts. “If there is indeed nothing untoward about the nature of its dealings with the Gupta family, Multichoice will have no issue publishing the requested documents for public scrutiny,” DA MP Phumzile van Damme said in a statement. If MultiChoice failed to do so, the DA would approach Icasa in terms of clause 7 of Icasa’s Subscription Broadcasting Services Regulations, as a licensed subscription service provider, MultiChoice is required to keep a record of all contracts it enters into, which Icasa has the power to subpoena, as it deems fit”.
BusinessLIVE has reported today that parliament’s portfolio committee on communications would consider a probe into Muthambi’s role in ANN7 and MultiChoice should the DA table a request.
Glenda Nevill is the editor of The Media and The Media Online. Follow her on Twitter @MediaTMO.