South Africa: End of Open Time Will Hit M-Net Revenue
M-NET's free-to-air, open-time slot, which airs between 5pm and 7pm daily, stopped at the end of March. This will hit the channel's advertising revenue and remove a valuable branding opportunity to recruit subscribers. In 2005, the Independent Communications Authority of SA (Icasa) ordered the closure of the open-time window from next month, after a run of 20 years.
Icasa said that paid services could not have access to free-to- air, open-time windows, as they would be unfairly competing with other free-to-air broadcasters. The closure, the revenue loss of which two years ago was estimated at R60m, will result in a drop of nearly 40% of the open-time audience of about 500,000, says CEO Glen Marques.
One option was to cut back on scheduling costs, but that would result in inferior programmes, he said.
Instead, the strategy was to create a dedicated "soap hour", with the popular soapy Binnelanders placed back-to-back with Egoli to get more people to subscribe as well as to keep subscribers tuned in every day, Marques said. "It's a risky strategy because it relies heavily on attracting non-subscribers to come on board."
The CEO of media planning agency OMD, Josh Dovey, said that M-Net had started making plans to protect itself when Icasa made the announcement two years ago that M-Net would have to shut down its open time. The company brought channels such as SuperSport and Movie Magic on to the country's biggest pay-television platform, MultiChoice's DStv, in a move to diversify M-Net, Dovey said. It also built up its bouquet, and clearly aligned itself as a part of the pay television network -- and not a stand-alone service.