Uganda runs DTT pilot and plans to go digital by 2012 but private sector argues for separate signal carrier

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The pace of the transition to digital broadcasting in Africa is picking up with a larger group of countries now entering the race with practical action rather than just policy proposals. But the issue of who will be the signal carrier has not been settled and the private sector is understandably wary of putting itself in the hands of the incumbent broadcaster. Russell Southwood looks at the issues that surfaced at a recent public viewing of digital television in Uganda.

Five Ugandan television stations are taking part in a digital broadcast pilot with 200 viewers receiving the signal in the capital Kampala. Patrick Masambu, the Executive Director of Uganda Communications Commission told those at the digital TV pilot viewing that the country will end analogue signals by December 2012, which is only three years away.

The five television stations taking part in the pilot include Kenyan-owned Nation Television (NTV), WBS, East Africa Television and Nile Broadcasting Service. The pilot transmissions are being carried out by Next Generation Broadcasting, a Swedish DTT company in partnership with national broadcaster Uganda Broadcasting Corporation (UBC) TV.

Next Generation Broadcasting has been assiduously courting public broadcasters across Africa with a variety of different proposals aimed at securing DTT transmission contracts and even channels. It offers to pay part of the costs of digital transmission in exchange for receiving channels so that it can become a broadcaster.

Its broadcasting strategy appears to be a combination of Free-To-Air and Pay TV offers. In Uganda, it plans to launch what it describes as “an attractive yet affordable pay TV bouquet containing a mix of local and International channels”.

In Ghana, it has been running a similar trial in the capital Accra (through GTV) with NET2, TV3, TV Africa, and Viasat 1, as well as the international channel KidsCo. The trial comes to an end shortly but it has been talking to local broadcasters about creating both FTA and pay-for bouquets. It had originally intended to launch this service by the end of 2009 but it now looks more likely to be early next year. According to the company:” Consumer will be able to top-up their channel selections as they wish on a pay as you go basis”. In other words, they want to achieve the television equivalent of pre-pay mobile.

There are two issues that need to be addressed here that seem to have received less than their fair share of attention. Firstly, why should private broadcasters trust the incumbent public broadcasters (who are their competitors) to handle their DTT transmission? In the parallel field of telecoms, the stories are legion of how telco incumbents have abused their monopoly position. Why will broadcasting be any different?

In this vein, the Chairman of the National Association of Broadcasters, Captain Francis Babu, called for the establishment of either a neutral digital television distribution company or the establishment of both private and public companies to promote healthy competition. These proposals exactly mirror the discussions that are taking place in Kenya where KBC has been given the signal carrier role but is making noises about creating a separate subsidiary. In effect, the public broadcasters become both poacher and gamekeeper without any very clear separation of those roles or any regulatory framework to govern them. The scope for them cutting off the signal for programmes that are uncomfortable for their political masters, the Government, is all too obvious.

The second issue arises out of NGN’s commercial strategy because like the public broadcaster it is both seeking to be a commercial television broadcaster and supply services to its competitors. Again there has to be a clear separation of roles if there is to be trust between the private sector providers and the signal provider.

The prize for all is wider coverage and that will have the inevitable effect of undercutting what little competitive advantage public broadcasters currently have: with government funding, they have usually extended their coverage area to those parts the market cannot reach. If they sell transmission as a service or there is an independent signal carrier, this is something they stand to lose because any broadcaster can then buy coverage at a price.

And this is where the debate will shift as the public broadcaster and its allies seek to keep the transmission rental rates high. Private players currently pay between $700 and $1,200 a month to UBC for using their transmission masts. UBC is being rather coy about what DTT signal transmission will cost in the future.

Kenyan private broadcasters have been told to expect US$1,500 a month per mast: the country will probably need around 20 masts to achieve something approaching national coverage. The higher price, the greater the incentive for the private broadcasters to set up their own signal carrier and share these costs, leaving the public broadcaster to pay all of its costs.

A sensible compromise would be advantageous to all parties but requires the kind of trust that can probably only be achieved by having an independent signal carrier.

Finally, the Uganda Minister made the right noises abut the issue oft tackling the cost of set-top boxes for those unable to afford them. "We are considering subsiding the cost of the additional technology to ensure that the analogue users can access the digital content...," said ICT minister Aggrey Awori.

How this subsidy is to be handled created a lively debate at the Media and Broadcasting Congress in Johannesburg in early November. A member of the Nigerian Broadcasting Commission was arguing that it made best sense to offer the subsidy to the manufacturer to lower the cost to the user.

The alternative of paying money direct to the user (say in the form of coupons) would mean that users might simply abuse the system. The South African regulator ICASA was adamant that paying subsidy direct to users was the best way to go. Regulators appear to be playing a key role in addressing this issue: Kenya’s regulator CCK will consider paying the set top box subsidy out of the funds it raises from operators. But whatever the outcome, these countries are at last moving from worthy policy papers to practical debate and action.