Sweden’s NGB takes the DTT route into both FTA and Pay TV content
After the death of GTV, it looked for a while as if no-one new would dare enter the African Pay TV market. However, a new report from Balancing Act (see Technology and Convergence News below) shows that competition is alive and kicking. Russell Southwood talks to Bjorn Weigel, Deputy CEO of Next Generation Broadcasting, one of the market’s new entrants about why Africa remains a compelling business opportunity for Pay TV operators.
Those who set up Next Generation Generation Broadcasting (NGB) were involved in the transition to DTT in Sweden, one of the first countries to make the switch to digital broadcasting. Some of those behind idea for the company had worked for a company called Boxer that that successfully set up Pay TV channels in the Nordic countries.
When NGB first set up, it looked at European countries but quickly decided it wanted to go a different route and it would focus on emerging marketing, of which Africa is an important element in their strategy. As Bjorn Weigel remembers it:”We had all the learnings from the Swedish roll-out, both technical and commercial. The first idea was to operate as a consultancy company but before the first year was out we decided to go the full way and set up as operators.”
Nevertheless, NGB has sought to use this consultancy approach in how it tackles getting the DTT transition under way. It works closely with a wide range of players including the public broadcaster to explain the technical and commercial advantages of DTT. It also seeks to tell broadcasters about the different ways in which FTA and Pay TV channels should analyse the emerging DTT market:”You speak to the broadcast content providers to try and understand and adjust to local circumstances.”
”Initially we always try and find a strong local partner who knows the market well. Our role is that of an individual service provider wanting to make money from subscription income.” The Pay TV operation will be branded Smart TV:”We have made a launch of the brand Smart TV in Ghana and if it works from the consumer perspective, it will be used in all our local African companies.”It has also started operations in Kenya and Uganda.
“We have other countries in mind. We’re looking into countries like Tanzania where the legislation (for the transition to DTT) is in place. It’s also a case of how many countries we can do at once.”
In some countries the process of getting the transition to DTT off the ground means working closely with the national broadcaster (as with their trial in Ghana through GBC) and in others with separate signal distribution companies.
To make it all work it means treading the fine line between being adviser and player as transparently as possible:”We want to get each country on the right start with different roles and responsibilities and include the public broadcaster and all the FTA channels in getting that process going. In some countries, that will succeed and in others it may fail.”
In content terms, it will be offering a combination of FTA and Pay TV channels, with latter giving both local and international content:”Our philosophy is that you need very strong local content to succeed. But almost the bigger challenge is finding good quality digital content in Africa. We do not believe in just throwing a high number of poor quality channels at the subscriber. We prefer a lesser number of high quality channels that people really want. It’s not going to be a top end product but one for the masses.” To reinforce this positioning, Weigel is talking of a monthly bouquet price point of US$7-15.
Its launch in Ghana will include all the existing five FTA channels but the Pay channels will include: BBC News; Al Jazeera; a music channel; Kids Co; two sports channels (Mega Sports and Setanta Africa); Vox Africa; Showtime; Star TV; HiNolly (from Nigeria’s HiTV) and Homebase (a Ghanaian movie channel from Afrimus).
But surely commissioning local content is a “deep pocket” activity? “We don’t own or operate any of these channels. We’re not a TV channel. We don’t produce. It’s Afrimus that’s packaging and producing the Homebase Channel. We have inspired and helped them but it’s their game. They’ve taken the risk. They have an interesting catalogue to put on our platform. We could see that it would be the foundation for an interesting channel. It’s also a good example of what we’d like to see.”
In terms of subscriber numbers, NGB is calculating that if all the Pay TV platforms (including IPTV) take a market share of between 20-60% of the overall TV households in developing countries, then the percentage in Africa will be lower but will still offer a sustainable market. There is the issue of electricity supply:”In Ghana sustainable coverage is about 50% of the population whereas in Kenya and Uganda it’s much less than that. If you have electricity, you could be one of our customers. That’s how we calculate it and we wouldn’t be in the market, if we didn’t believe it was a big and growing market.”
“In a country like Ghana there are something like 2.5 million TV households and maybe only 100,000 of these are not analogue. That means there are millions of households that need set-top boxes. The operator who runs the platform can help with finance and logistics and this is the role NGB can play.”
But what about the high levels of competition in the market?”We believe competition is good. It shows that you have a market that works. It’s not good if you only have a few players. You can have players that destroy the market and players that add value. We will see responsible players who create a functioning market in the interests of the African consumer. The market is huge and therefore there will be several winners.”
Its main investor is a Swedish pension fund and this gives it an advantage in terms of timetable and return:”They will take a 5 year rather than a 1 year view. We’re here to create a sustainable business. We’re hiring local people and operating where we set up out of local offices. We’re not in a hurry. It will happen in Africa and it will be huge. We think that we can grab a huge share.”
2nd Africa Broadcast and Film Conference, Kenyatta International Conference Centre, Nairobi, 28-29 July 2010
The conference is aimed at senior and middle managers in:
• National television stations • National radio stations.
• Pay TV companies using cable, IP-TV or satellite.
• International Broadcasting Stations like CNN, BBC, NBC, VOA, China Radio, Al Jazeera, Radio Japan, Deutsche Welle and Radio Netherlands.
• Television and film production companies.
• Facilities providers including production equipment hire, post-production and outside broadcast.
• Organisations like donors and faith-based organisations that run their own broadcast organisations for development purposes.
• Television and film equipment vendors and satellite capacity suppliers.
• Advertising and marketing agencies.
• Mobile and fixed telephone operators looking at convergence opportunities.
• Library Facilities for music, commercials and programmes.
(* Invited but not yet confirmed)
Day One – 28 July 2010
Introductory overview session: Africa’s prospects over the next three years Russell Southwood, Balancing Act will look at the changes in the industry across the continent over the last two years and the changes affecting its future growth.
Session 1: Africa’s Free-To-Air and Pay TV challengers Chair: Cathy Fogler, CAfrica Sports; Speakers: Euan Fanell, CEO, Wananchi (Kenya); Lara Kantor, Group Executive: Regulatory, eTV (South Africa); Mactar Silla, Chairman of APPTA (Association of Private Producers and Televisions of Africa); George Twumasi, CEO, African Broadcast Networks; Joe Frans, CEO and President, NGB Africa; Elissa Wilding, CEO, Free2View*; Robert Grant, Head of Media Investment, FCMB*;
Session 2: Getting local content through advance sales, commissions, sponsorship and co-productions: the economic rules of the production game Chair: Salim Amin, CEO, A24 Speakers: Wachira Waruru, CEO, Citizen; Sarah Migwi, Regional Head, Ultima (Kenya); Cherise Barsell, DISCOP; Charles Igwe, CEO, Bob TV*; Nneka Isaac Moses, CEO, Goge Africa*; Myke Rybar, CEO, Home Boyz Entertainment*;
Session 3: Delivering broadcast output in new ways Speakers: Steve Rich, Vice President and General Manager, SES Astra, Africa (South Africa); Eyal Coppitt, SVP Sales Africa, Amos Spacecom (Israel); Suhayl Esmailjee, CTO, Wananchi (Kenya); Seni Williams, MD, Tara Systems*; Frans Lindeque, CTO, ODM*
Session 4: The Digital Transition – How can Africa make this work for broadcasters and audiences? Speakers: Anton Lan, Business Development Director, Altech UEC (South Africa); Sean du Toit, Director, Spescom Media IT (South Africa); Daniel Obam, Digital Task Force (Kenya); George Lasry, Channelot
Day Two – 29 July 2010
Session 1: Broadcast regulation – Holding the industry back or spurring it on? Speakers: Engr Yomi Bolarinwa, Director-General, National Broadcasting Commission (Nigeria)*; Charles Njoroge, Director-General, Communications Commission of Kenya*; Cherise Barsell, DISCOP on piracy;
Parallel session 2: FM radio stations – How to compete in a crowded market place Chair: A radio expert will chair a panel of local African radio stations. Keynote speaker: Patrick Quarcoo, Kiss FM (Kenya)*; Joe Otin, Synovate (Kenya); Moses Nyama, Director, Q-FM, Zambia; Charles Ekanem, Director, ESJ Interactive on using the use of SMS by radio stations;
Parallel session 2: Programming – Getting the most out of themed channels Speakers: Nada Anderson, CEO, Sports Uganda*; David Campbell, CEO, Mediae;* George Kimani, CEO, Continental Content Distribution
Parallel session 3: In the danger zone – what should broadcasters say or not say Panellists include: Oscar Beauttah, (Kenya); George Apiyo and other speakers to be confirmed,
Parallel session 3: After Nollywood, what next? – Getting African film seen across the continent Speakers: Keynote speaker: Imruh Bakari, Savannah Films (Tanzania); Charles Ihidero, Bob TV*; Professor Emevwo Biakolo, Dean, School of Media & Communications, Pan-African University (Nigeria) on capacity building and training . There will be a panel to include local film-makers, distributors and cinema owners.
Session 4: Multi-platform strategies – Creating something that is more than words Panelists include: Kelvin Karungu, CEO, Habari TV; Fidelis Ndege, D-G, ANN24.com (UK); Salim Amin, CEO, A24 Media; Daudi Were, Africhange (Kenya)*; Anton Lan, Business Development Director, Altech UEC (South Africa); Joe Mucheru, Regional Lead Sub-Saharan Africa, Google on social media*
If you would like to be a speaker or panellist, please contact Russell Southwood, Balancing Act on: firstname.lastname@example.org If you would like to be a participant, exhibitor or sponsor, please contact Helen Moroney, Aitec on: email@example.com