After failing to convince communications regulator Icasa to put in place tighter measures to break pay TV giant MultiChoice’s monopoly on sports coverage, the SABC is now banking on competition authorities to step in as it battles to boost its revenues.
MultiChoice, which owns DStv, dominates the market partly because it has exclusive contracts for premium and international content, such as high-profile rugby matches, local Premier Soccer League (PSL), the English Premier League, the Spanish La Liga and the Uefa Champions League.
While Icasa has in recent years looked into opening up the market, updated regulations mostly maintain the status quo — meaning that sought-after rights for all platforms are sold to the highest bidder with no unbundling of rights or fair sub-licensing criteria required.
The aggrieved public broadcaster approached the Competition Commission last week to file a complaint against DStv’s SuperSport, arguing that the company has resorted to anticompetitive and exclusionary behaviour, presumably to block the public broadcaster’s recently launched dedicated sports channel from getting off the ground.
The SABC’s main gripe is that MultiChoice, which holds the rights of many of the lucrative sporting codes largely because of its financial muscle, places unfair restrictions on where the public broadcaster can flight sublicensed matches. The public broadcaster generally buys the rights to air matches via MultiChoice, which monopolises sports coverage.
The SABC is said to be unhappy that MultiChoice insists that sublicensed matches cannot be broadcast on the public broadcaster’s dedicated sports channel on OpenView or streamed.
The public broadcaster recently entered into a multiyear distribution agreement with free-to-air satellite service OpenView paving the way for it to launch three new channels, including one dedicated to sports coverage. With OpenView having a presence in as many as 3-million households, the SABC sees its sports channel as central to its turnaround strategy as it pushes to return to profitability.
Financial difficulties
But without being able to air crucial games on the platform, such as Springbok rugby matches, the channel is very unlikely to gain traction, derailing the broadcaster’s drive to stabilise its finances.
This after years of acute financial difficulties amid a slump in advertising spend made worse by the Covid-19 crisis and reduced collections for TV licence fees, leading to a net loss of R530m for the 2020/2021 financial year.
The SABC has also bemoaned the fact that it is underfunded by government that it says makes it difficult for it to meet its mandate. The unprofitable public broadcaster is compelled through legislation to cover events that are deemed to be of national importance, including sporting codes of national interest such as football and rugby. Hence its push to unbundle sports rights or at least fair sub-licensing criteria will be crucial for its turnaround plan.
The ANC has also thrown its weight behind the unbundling drive, with the governing party recently calling for an end to exclusive broadcasting rights on national sports events.
Media Monitoring Africa director William Bird said it’s surprising that the issue of the fair distribution of sports rights has taken so long to resolve, given that it dates back to 2017.
“While some had hoped the issues would have been addressed by the sport rights regulations we are still left with one broadcaster that dominates sports. I think the real shift is going to be what happens when even bigger players come on board,” Bird said.
A MultiChoice spokesperson said the pay TV operator has not yet received the complaint from the SABC indicating that it is approaching the Competition Commission.
“Should we receive such a complaint, we shall, as always, co-operate fully with the authorities in regard thereto.”
But any measures that will ensure a much more equitable distribution of sporting rights could arguably threaten MultiChoice’s commercial viability. It’s a matter that is very likely to end up in the courts as the country’s competition laws come under scrutiny.
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