MultiChoice rejects Caxton’s allegations over SABC deal

Johannesburg - Pay-tv provider MultiChoice has rejected several allegations from publishing company Caxton regarding a deal with the South African Broadcasting Corporation (SABC).

Caxton, the SOS Coalition and Media Monitoring Africa, are challenging a deal for the SABC’s supply of two television channels to MultiChoice.

Caxton, with the support of the SOS Coalition and Media Monitoring Africa, has written to the Competition Tribunal of South Africa saying that the agreement with the SABC should be regarded as a “merger” and that it puts MultiChoice in a position to influence policy with regard to the country’s digital migration process.

MultiChoice, though, has criticised these allegations in an affidavit which was submitted to the Competition Tribunal on April 17.

“We totally reject the allegations and the misrepresentations they’re based on,” said MultiChoice executive chairman Nolo Letele in a statement.

“There’s simply no basis to suggest that there is anything wrong with our relationship with the SABC.

“The truth is: This is a standard commercial agreement for the supply of two television channels – a news channel (already on DStv) and an entertainment channel (which will be added shortly). We have the same kind of agreement with dozens of other channel suppliers, locally and internationally,” added Letele.

Letele also said that it is “standard practice to commission and license new channels”.

“So there’s no way this can be described as a ‘merger’ that needs approval by the competition authorities,” Letele said.

The likes of Media Monitoring Africa have also raised concerns that the deal could allow MultiChoice to veto SABC shows based on their quality, a move that risks ensuring that the best local programming is aired for DStv subscribers only.

Media Monitoring Africa has further expressed concern over aspects of the deal which are said to include handing over the SABC archive to MultiChoice.

Questions have also been asked about why the public broadcaster decided that it opposes set-top box encryption and adopted the same stance as that of MultiChoice.

The Department of Communications this year has adopted a policy that excludes set-top box encryption for the country’s digital migration process.

The likes of the Democratic Alliance (DA) have criticised this move for potentially opening up content providers to having their television shows pirated. This could also result in broadcasters not showing high quality programming.

A lack of encryption could further mean that devices that are stolen can’t be switched off.

But MultiChoice denies that it has influenced policy through its deal with the SABC.

“It’s also not true to say we’ve influenced the SABC’s position on encryption. The SABC has taken different positions on encryption at different times during the digital migration process for reasons unrelated to the agreement with MultiChoice,” said Letele.

“However, before the agreement with MultiChoice was concluded, the SABC was opposed to encryption.” Letele said.

Caxton is listed on the Johannesburg Stock Exchange (JSE) and specialises in printing books, magazines and news publications.

In papers before the Competition Tribunal regarding the MultiChoice-SABC deal, Caxton’s chief executive officer Terrence Moolman said his company is “exploring the possible expansion of its business into digital television and video content to be delivered via various forms of digital media”.

*Fin24 is part of Media24 which is owned by Naspers. MultiChoice is also a Naspers company.

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