Johannesburg - Broadcaster e.tv has won a legal battle in Bloemfontein’s Supreme Court of Appeal against government’s decision to not encrypt set-top boxes for digital broadcasts.
Set-top boxes are key to South Africa’s digital migration project which will shift public broadcaster the SABC from analogue to digital signals.
The move is set to open up much-needed frequencies for faster mobile broadband services as well as help the SABC to switch on more digital television channels.
To aid the digital migration process then, government is set to distribute up to five million subsidised set-top boxes to poorer households.
However, a dispute emerged when Communications Minister Faith Muthambi altered South Africa’s digital broadcast migration policy so as not to encrypt these subsidised boxes.
Subsequently, e.tv in June last year turned to the North Gauteng High Court to challenge the decision on the ground that a lack of encryption could mean that “non-compliant STBs” would receive digital broadcasts and that e.tv would be unlikely to provide high definition broadcasts.
The court, at the time, then ruled against e.tv with Judge WRC Prinsloo saying that Muthambi understood the effect of the encryption amendment. The same court then granted e.tv leave to appeal the decision in November last year.
And the Supreme Court of Appeal on Tuesday has ruled that e.tv’s appeal of the matter is upheld with the costs of two counsel and that a clause of the digital migration policy is declared unlawful and invalid.
“By precluding the subsidised ST boxes from having encryption capability the minister has made it impossible for e.tv and other broadcasters to broacast encrypted signals to television viewers who have subsidised ST boxes,” wrote Judge of Appeal CH Lewis in the judgment.
“This may place e.tv in breach of its licence conditions. It is not possible for e.tv - or anybody else - to fit these ST boxes with encryption capability after manufacture.
“It would be required (for e.tv) to manufacture additional ST boxes for the five million households that cannot afford them and distribute them at no charge. It (e.tv) cannot do that. The cost would exceed two years of its revenue, some R3bn,” said Judge Lewis.
The Supreme Court of Appeal further found that Minister Muthambi’s failure to consult with parties such as e.tv, and the Independent Communications Authority of South Africa (Icasa) about the amended policy was irrational and in breach of the principle of legality.
Icasa, the SABC, the Electronic Media Network (M-Net), the state-owned Universal Service and Access Agency of South Africa (Usaasa) and Muthambi were all among respondents in the appeal bid by e.tv.
The Supreme Court of Appeal also found that Muthambi acted beyond her legal authority in making the amendment.
Responding to the judgment, e.tv said the court’s decision would help ensure a proper approach to digital migration in South Africa.
“We are committed to the DTT (digital terrestrial television) platform, but want it to happen in an inclusive and organised manner,” said Mark Rosin, chief operating officer of e.tv, in a statement.
“This ruling allows the possibility of a strong and stable DTT platform to South African free-to-air television viewers offering the best local and international content,” said Rosin.
Muthambi's office also responded to Tuesday's court judgment.
"The Supreme Court of Appeal has not ordered the reversal of the broadcasting digital migration policy or interdicted the implementation of this key national project," Mish Molakeng, spokesperson for the ministry, told Fin24 in an emailed statement.
"DTT has the potential to radically transform the value chain of the broadcasting and telecommunications systems, thereby creating a new industry trajectory that will assist in addressing the triple challenge of poverty, unemployment and inequality.
"Noting this judgement, on Friday June 3, Minister Muthambi will be in Kwaggafontein in Mpumalanga driving registration for set-top-boxes for qualifying television owning households," added Molakeng.