Yesterday’s much-anticipated budget speech may be today’s biggest headline, but for media players, this week’s testimony at the Zondo Commission may have wider implications, as it underscores the roles of various government members and entities have played in the communications and broadcasting sector – and highlights the impact this has had, and will have, on future regulations.
Icasa has been busy: the regulations body has a number of inquiries underway in its efforts to invigorate the broadcast and communications sectors, and in 2019 submitted a series of draft proposals outlining suggested policy and regulation amendments. These proposals have been years in the making, and are now at various stages of development – even as aggressive shifts in the market is rendering proposed legislation ineffective, says the Free Market Foundation’s executive director, Leon Louw.
Case in point: Icasa is finalising highly contested regulations into Sports Broadcasting Services. “Yet already, two of the world’s largest sporting bodies, La Liga and EUFA, have both launched their own OTT streaming platforms, and announced that they may abandon selling rights to TV networks in some markets and provide matches via a streaming service instead,” Louw points out.
Spain’s La Liga launched their own channel in March 2019; in January (2020) La Liga TV, which broadcasts 24/7 in HD, became the first football league in the world to have a dedicated channel showing all La Liga matches live in the UK and Ireland, having partnered with SkyTV. UEFA, too, launched UEFA.tv in June, and started by offering live women’s, youth and futsal content, while the WWE, Formula One and GolfTV are just a few more sporting federations following suit.
“This may be great news for local sports lovers, who are finding it easier to access and stream live events, but these advances by sporting bodies reflect the marked increase in content creators bypassing regular broadcasting platforms to provide services directly to the consumer,” adds Louw.
The trend is most apparent in direct-to-consumer video services such as YouTube, Netflix and Disney+, which compete directly with both pay-TV and Free to Air broadcasters by targeting their subscriber base and market share directly.
Africa’s leading pay-TV provider MultiChoice has not been immune to Netflix’s entry into the market and reported a loss of around 140 000 Premium subscribers across Africa in the past two years; the company has embarked on aggressive strategies to counter this and possible future losses.
These shifts will impact directly on further proposed regulations, notably Icasa’s Draft Inquiry into Subscription Television Broadcasting Services – ostensibly initiated to counter MultiChoice’s supposed dominance in the pay-TV market and level the playing field for new entrants.
“When Icasa commenced the Inquiry (into subscription platforms), the necessary infrastructure – broadband, spectrum and data – for successful pay-TV and OTT services were largely inaccessible. These, along with extended delays in rolling out DTT (digital terrestrial television), contributed to Multichoice’s position in the market,” says Louw.
However, the landscape has changed inexorably since then: lower cost of entry and easy content distribution has seen a rise in regional and local OTT service providers, notes Louw.
“Vodacom Video Play, StarTimes, Viu, iROKOtv, Digital Entertainment on Demand, Trace and THD24 are just some of the new or expanding OTTs on the market. But it’s the significant developments in direct-to-consumer streaming services by content owners, driven largely by smartphone and fibre penetration across the continent, that will have the most resounding impact on the broadcasting industry as a whole,” posits Louw.
Streaming is also changing the way Hollywood does business; because streaming content is not restricted by the need to meet box office targets or hefty third-party licensing revenue, and with major Hollywood studios such as WarnerMedia and NBCUniversal launching streaming services this year – or partnering with streaming platforms, more and more films will be diverted to direct-to-consumer releases.
“These rapid technological advances are shifting the way the entire broadcast industry operates and thus effectively rendering any new legislation null and void from the onset. Most interested parties agree that the current regulations are serving the needs of the industry – don’t fix what isn’t broken. Failing to take adequate note of the ongoing rapid, massive changes within the industry means Icasa will again fail to formulate relevant policy and legislative requirements, and possibly cause more harm than good in the future, especially when that future questions the relevance and sustainability of traditional TV as we know it.”
The playing field is changing rapidly. Icasa is behind the curve and trying to regulate for the past. It is too late to regulate – Icasa needs to look to the future and formulate different proposals that reflect current and future trends in Pay and Free-to-Air TV.
Lucinda Jordaan is an independent journalist, author and Media and Communications Consultant, specialising in the media and entrepreneurship sectors.
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