A lot of people in Zambia are pissed off at DSTV for the obvious reason; they have raised prices on consumers again. Of course the excuses are the same; the price increase is only taking into account currency movements with the weaker Kwacha. The cost of content has increased and so they have to ‘increase’ prices etc. The bottom-line though, is that DSTV is a de facto monopoly and can therefore increase prices whenever it wants with little consequence even without the option of pay per view (PPV) where you only have to pay for channels you want. And of course instituting price controls does nothing to actually grow the local TV industry besides it is a free market economy. If anything it will probably harm it. Boycotting DSTV will make them feel that they are on top and you can’t do without them
It is very unlikely that DSTV will witness strong, large-scale competition as the pay TV giants are masters of their art. Perhaps the most often said phrase in media and content related businesses, the ‘content is king’ phrase tells a major part of the story of DSTV’s dominance. This could be vindicated by the superciliousness of Multi Choice Zambia Managing Director Simon Bota who remarked that the company doesn’t force anyone to pay for DSTV rates. Crucially, the pay TV business is driven not just by content, but at the top end, by the quality of such content. In this regard, DSTV have continually executed a stunning strategy of signing multi-year, pan-African content licensing deals that enables them not only offer premium content to subscribers, but to also keep this content largely exclusive and off the hands of would-be competitors. With a stronghold of such premium content, DSTV holds the aces in determining prices and with the absence of credible competition in major operating markets, the advantage is further increased. In essence, DSTV’s monopoly of the market is occasioned by a more significant monopoly of content.
The approach to dealing with monopolies is to force some kind of competition. To get a DStv Premium, which offers about 55 television channels and 40 CD-quality audio channels, will set you back K710 a month. For PVR and dual view, you’ll have to pay a monthly access fee of K90. DStv Compact is the cheaper option, which gives you about 16 channels will be costing K330 a month. Alternatively, the Zambia government should create a favourable environment by attracting investors to invest in cable TV business instead of boycotting DSTV. For example, government in liaison with MTN Zambia can lure would-be potential DStv competitors like MaxTV with MTN & ABSA as shareholders which had applied for commercial satellite and cable subscription broadcasting licence for 80 video, 50 audio and five data channels. It intended to provide 10 video channels as minimum package for K40 a month though their application was rejected by Independent Communications of South Africa. Further, Star TV of China (operating in South Africa), Zuku of East Africa (Tanzania & Kenya), Airtel Digital TV of India, Canal +Afrique of Francophone Africa (African French), Sky Digital & Virgin Media of UK, Movie channel & Hustler TV of USA are some of multi-channel pay TV monsters who can make DSTV cry for customers. Remember what happened to DSTV when G-TV came on the scene comparatively overtaking them.
Conversely, Muvi TV or Prime TV even our very own ZNBC which is boutta to go digital can capitalise on this & make DSTV run for their money by choosing to stream let’s say 40 channels with a minimum package of may be 10 quality channels for a predetermined duration of time. According to Wikipedia the regular pricing for premium channels ranges from $10 to $25 (K74 to K187) per month per suite (package), although other channels such as sports & adult networks may go up to $50 (K372). In fact in other countries Pay TV goes with bundles for internet & phone.
In essence regulators like the Independent Broadcasting Authority (IBA) positioned to protect Zambians from these arbitrary actions can force a market structure where consumers pay satellite providers (DSTV and co) for delivering content and then pay the content producers for the channels they want. This should result in more competition amongst satellite and alternative content delivery platforms which is good. It should result in more competition and larger revenues for content creators which are also good. Finally it should result in lower total bills for consumers. Lower bills because you will actually only pay for channels you want where services are similar to subscription-based pay television services in that customers must pay to have the broadcast decrypted for viewing through pay-per-view (PPV).Just like one using the phone is billed based on the time spent on talking, the same should be applied to the cable TVs.
Of course others will argue that this is democracy and free market economy. This kind of regulatory move will be politically difficult of course. Anyone who has been following the net neutrality debates knows how political it can get. But it can work. There is nothing technically preventing it from happening. Just the will to make it happen. The prize of course is a much larger content creation industry and a much larger TV content delivery industry. And happier customers!!!
By John Shumba aka $hooz