Satellite companies pitch DTH as a solution to meeting the digital broadcast transition deadline

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The ITU deadline agreed by most African countries for the transition from analogue to digital broadcasting is only four years away. Elsewhere in the world, the transition has taken between 3 to 14 years to complete so time is running out. Knowing the difficulties of rolling out terrestrial digital (DTT) broadcast equipment, the satellite companies are putting forward DTH satellite as an alternative. Thus far no Government has yet taken up the idea but as the deadline nears it’s worth thinking about. Balancing Act’s Sylvain Béletre talks to Christoph Limmer, Senior Director,  Market Development Africa, SES about what satellite can do.

According to Christoph Limmer, requests for information on satellite TV are flooding in. “Quite often we get asked if satellite can really reach more homes than other infrastructures like cable or terrestrial. The answer simply, is yes. Unlike DTT (Digital Terrestrial Television) or cable which are ground based infrastructures and normally roll-out in certain areas only; satellite has no limitations in achieving 100% population reach.” Digging cable is costly and time consuming and rolling out DTT network infrastructure is facing similar challenges.

A growing issue with terrestrial infrastructure is cable theft. There continues to be frequent reports of stolen cables, both of power, TV and telecoms equipment globally; Cables are being stolen for the scrap value of their metal content, especially copper. Though cable theft has existed for several years, it has become a much more serious problem as a result of the rise in metal prices. This disease is widespread including on the African continent. Building construction sites in South Africa have been the targets of raids by well-organised armed gangs, so that cable is stolen even before it can be installed. Cable theft is not only a cost burden for operators and end-users, but can affect their strategic decisions: in some African countries, such as Kenya, telecom operators have decided to invest more heavily in wireless networks due to the persistent problem of cable theft. However, even these “wireless” systems are not immune to cable theft, as cables used within wireless base stations are also targeted by thieves. More recently, fibre optic cable is the new target for thieves. Therefore, the satellite companies are arguing that satellite should be considered as primary infrastructure that can feed other distribution networks if architecture is aligned. This reduces both the set-up time and cost, and increases the reach of connectivity.
Among players preparing for this fresh wave of satellite connectivity demands is SES. With 7 satellites over Africa and five more to be launched in the next four years, SES is dedicated to providing services to customers in Africa. Already additional staff and new local offices are providing on the ground business, technical and marketing support to clients that include broadcasters, telecoms operators and government departments.

“The new generation of our broadcaster customers and pay TV operators like TopTV in South Africa, Zuku TV in Eastern Africa or Multi TV in Ghana are looking at their market audiences and working out how best to deliver content and target the various levels of affordability”, says Limmer. MultiTV in Ghana says it has 300,000 DTH subscribers. (See an interview with Kenneth Ashigby of Multimedia Group here:)

“In Kenya for example, the huge middle class has been largely under-serviced which provides huge growth opportunities. Operators can no longer look at just the urban populations at the top of the social pyramid but need to consider semi-urban and rural access, as well as take a different approach to customers when it comes to the costs of hardware installation and monthly subscription rates. In the future, packages in Africa will be priced between US$ 10-20 showing attractive local and international content with payment options on offer such as via mobile phones, scratch cards and pay per view.”  Distribution is a key issue given Africa’s unique geographical challenges and the most cost effective and efficient method to reach the rural market is to use existing infrastructure. “Many new generation pay TV operators are partnering with established players using existing distribution vehicles rather than creating their own distribution network from scratch”, comments Limmer.

DTH has three ways in which it might contribute to the digital transit

1. The big one: A country would sign up to the idea that a satellite distributor would carry all their television signals and junk their existing terrestrial infrastructure. This lowers the immediate CAPEX but means you will then need to pay a regular OPEX to a satellite provider. The key question then for Government and broadcasters is whether this OPEX would be higher than through terrestrial infrastructure. But the junking of an entire existing terrestrial infrastructure seems unlikely as the masts currently used for analogue can be redeployed. At last week’s WATRA workshop on the digital transition for regulators, an NCA representative made the point in another context that it wished to see the television distribution infrastructure in Ghanaian hands. Rightly or wrongly, these “national” arguments will be decisive in a number of African countries.

2. In support or round the edges: Television in most African countries is largely an urban phenomenon. In even in countries with wider coverage areas, there are still areas where television does not go. The market research data from places like Ghana show that where radio and TV are equally available, they are equally used: (see interview with Seyram Mankra, Media Manager and Synovate here: ) Therefore, if in terms of Government policy, one objective of the digital transition is to increase the coverage area of television, one way of doing this is to supplement the terrestrial signal with satellite signal coverage for un-served areas thus giving potentially 100% coverage. Then the very real obstacles of lack of power in many areas will need to be addressed. But getting television coverage to a larger percentage of the population should be a universal service objective in Government policy: Sierra Leone provides an example of where such a policy already exists. Satellite is ideal for reaching a population that is widely scattered across a geographic area.

3. Commercial opportunities: In commercial terms, satellite is ideal for reaching large numbers of people relatively easily. Pay TV operator Wananchi launched a DTT platform because it is hard to run cable and fibre outside of densely populated urban areas. DTH is also relevant to commercial Free-To-Air operations: the example of MultiTV above shows that with the right marketing and programme bouquets, customers are more than willing to pay for a one-off Set-Top-Box.
There is also the tantalising possibility of a pan-African Free-To-Air bouquet, the idea that the ill-fated Free2View was trying to get off the ground. The idea being that with somewhere between 250,000-500,000 subscribers, the proposition would achieve sufficient “critical mass” to be of interest to pan-African advertisers. The concept may have failed first time around but it has not gone away. The key to successful satellite implementation as part of the digital transition process will be that wherever DTH boxes are deployed, they contain the majority of the Free-To-Air channels that are available in a country and that the DTH Set-Top Boxes will have to be sold at a price point between US$50-100. However, the reality of un-served areas will mean that this price point would need to be nearer to US$30-50, comparable to a low-end mobile handset. If everyone in the process can address these issues, then satellite is likely to play a significant role in the digital transition process.

To contact SES, go to: www.ses.com


Videos on Balancing Act’s Web TV Channel that need watching to understand where the broadcast and film industry in Africa is going:

Seyram Mankra, Media Insights Manager, Synovate,
the main market research company for media, on the changes in the media landscape in Ghana and respective merits of radio and television for advertisers:

In a new series, Seyram Mankra, Media Insights Manager, Synovate looks at What Ghanaians Watch on TV, drawing contrasts between male and female viewing. He also talks about his own viewing patterns as someone who is a professional in the industry:

L'Institut Francais, Dept Cinéma et sa cinémathèque Afrique
Dans cette vidéo, deux responsables du dept. Cinéma - Valérie Mouroux, et Véronique Joo Aisenberg - au sein de l'Institut Français à Paris présentent pour la chaîne 'Balancing Act' les activités audiovisuelles de l'établissement, et en particulier par rapport à l'Afrique:

Balancing Act's Twitter feed provides a combination of breaking news for telecoms, Internet and broadcast in Africa, direct tweets from countries visited and access to the occasional rumours circulating. You can follow us on:
@BalancingActAfr

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Erratum: A title is our last broadcast e-letter edition, Issue no. 105, 26 May 2011  "Nigeria: StarTimes Hits 4,000 Subscriber Base" was wrong. Our source, “the Daily Champion Nigeria” made an error which we relayed and then corrected it. The StarTimes current subscriber base is at 400,000 and not 4,000. The company says it is registering an average subscription of 30,000 per month.
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