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APRIL 30, 2007 VOL. 21. NO 3

From Multi to No Choice

**DSTV Dish**

South African digital satellite provider of pay per view television, Multichoice, runs into troubled waters as a rival outfit offers better programming and cheaper rates
By Victor Ogene
This may not be the best of times for South African-owned digital satellite television company in Nigeria, Multichoice with the emergence of HiTV on the pay-TV platform.
The South African company’s monopoly of pay per view television in Nigeria for 10 years was finally broken late last year when HiTV came on the scene through its parent company, Entertainment Highway Limited (EHL), to announce that it had won the rights to the English Premier League, (EPL), for the next three seasons.
Before now, the EPL has been one of the most important programme content of Multichoice through its Supersports channel for its Nigerian audience. It was jolted when it lost the broadcast right to the Nigerian market considered its most crucial target within its growth plan in the continent.
Among other property it lost to the new pay-TV bouquet is the Spanish Primera Liga, the Italian Serie A, the 2007 Wimbledon Tennis grandslam and the American NBA basketball.
Expectedly, this development has sent jitters to Multichoice which has to grapple with the prospect of losing Nigeria, considered its largest market in Africa. Already, heads have started rolling as the Chief Executive Officer, (CEO), of Supersports, Heinrich Enslin, has been removed for losing the broadcast right of the juicy sport property to the Nigerian firm.
Shareholders of the company who had been basking in the euphoria of an expanding market especially in the Nigerian area due to the English Premier League are upset that they lost the rights of screening the game to the new Nigerian pay-TV company, HiTV.
Also very painful to Multichoice owners is the loss of the Spanish La Primera Liga to the same company for the whole of Africa. In fact, Multichoice had to buy the broadcast right for the South Africa area from EHL, the parent company to HiTV.
Enslin, The Source gathered, was removed and replaced by the head of Supersports South Africa, Imtaize Patel, whose job was equally saved by the fact that he got the rights of the premiership for South Africa. Patel now doubles as boss of Supersports Africa.
The acquisition of the rights to the two premium football leagues by HiTV has brought a lot of pressure and confusion to the Multichoice team as well as dashed their hope of growing their business in the African continent.
Presently, as a response, the new Supersports boss has begun sourcing for other properties to make up for the shortfall for its audience, as well as looking elsewhere for new markets. In this light, Supersport has acquired the rights of the French ligue 1, where some Nigerians and a huge collection of francophone African players ply their trade.
A cocktail of the EPL, the La Liga and various sports programmes constitute the main attraction on the Multichoice network platform for which Nigerians have had to pay N9,000 each month as subscription fee for over three years now. This comes after paying an initial installation fee of N35, 000.
HiTV on the other hand is offering this same quality programmes and more for a monthly subscription of N3,000, after an installation bill of N25,000.
HiTV, a Nigerian-owned digital cable television, acquired the broadcast rights of the EPL, the La Liga and the Italian Serie A.
Among some of its other sports property is the European Nation’s Cup qualifier, Wimbledon Tennis grand slam, the American NBA Basketball, World Wrestling Entertainment and many more.
Furthermore, The Source gathered that the parent company of HiTV, Entertainment Highway Limited, has facilitated a memorandum of understanding between the EPL and the Nigeria Football League, (NFL), to help develop the Globacom Premier League, as well as provide a global platform for the Nigerian game.
There are indications that one of the major investors in Multichoice Nigeria, the Johnic group, has begun divestment procedures from the South African company as a result of these losses, claiming that without those properties the firm’s stock would definitely not be attractive for the future.
In a paid announcement in major national dailies, Johnic which was reportedly a shareholder in Multichoice, dissociated itself from Multichoice Nigeria, claiming that it is owned by Naspers, its major competitor in South Africa.
The announcement read in part: “The last minority investment by Johnnic Communications in a Naspers subsidiary is being sold currently.”
Coming on the heels of the loss of its most juicy sports content, investigations reveal that Multichoice has also incurred the additional loss of exclusive broadcast rights for the rest of Africa with the emergence of Gateway Television which clinched the rights in North Africa.
However, the South African company appears not to be in any mood to let go without a fight. In addition to all that the company has been doing to manage the situation, it has also resorted to desperate moves to frustrate the new Nigerian firm which is giving it a run for its money and reclaim these rights.
Along with its Nigerian collaborators, Multichoice had attempted many obstacles to stop HiTV from taking off. The Source learnt that a top official of the company had informed global news giants, Cable News Network (CNN), that HiTV was transmitting its signals without encryption. Following this, the American broadcast station wrote its Nigerian agent, DISC Communication, asking it to revoke the transmission authority to HiTV.
But the Nigerian Broadcasting Commission (NBC), moved in quickly to clear the air, stating to CNN that HITV is a duly registered and legal pay-TV platform in the country contrary, to allegations that it was a pirate station.
Similarly, some Nigerians who had shown interest in partnering with the EHL pay-TV project had unscrupulously staked some $2.4million to take possession of the Strong Technology equipment deployed by HiTV for its operation, convinced that the Toyin Subair-led firm would never be able to pay up for the equipment, as well as the broadcast rights which it had won.
There had, in fact, been speculations by observers, based on information reportedly peddled by Multichoice officials, and these supposed partners to HiTV, that the Nigerian firm might not be able to muster the finances to pay for the rights, but the young firm was to astonised many when on the final day of the deadline for payment it underlined its resolve to take possession of the property, coughing out a whopping $28 million for the EPL.
The company also paid a total of 6.9 million Euros for the Spanish league for the Africa region, despite its request to be given specific regional rights that is not for the whole of Africa.
These sports content acquired by EHL, the parent company to HiTV, constitute one of the most juicy and attractive programming by rivals Multichoice, which has enjoyed massive patronage as a result.
Competent sources within the sector told The Source that some individuals have done everything in the books to stall HiTV’s operations, including inducing pay TV dealers not to work with HiTV.
In fact, Ecobank, bankers to the new station may have been fingered in the moves to undermine the new company. Our investigations indicate that relations between HiTV and Ecobank have gone sour in the face of allegations of teaming up with Multichoice to pull down HiTV.
Reports have it that the acclaimed West Africa bank, though the financial institution to the Nigerian company, has refused to provide funds to aid the company.
Its relationship with HiTV’s rival, Multichoice, only came to the fore in the on-going Idols West Africa reality show.
Although the Nigerian pay-TV began transmitting its signals to viewers in the Lagos area from February 1, the development explains the delays it suffered in its take-off which was scheduled for December last year.
Broadcast industry watchers are, notably, predicting that these may be a deadly blow to Multichoice which have sent many Nigerian companies like DBN, ABG communication, CTL and FSTV out of the competitive market.
In fact, one observer pointed out that the South African company single-handedly ran out Nigeria’s first known sports station, DBN, by unscrupulously acquiring all their properties and took them to court for piracy. It did the same to North-based ABG, while CTL is barred from Lagos and Abuja. In the case of FSTV, it died before take-off due to its inability to acquire programme content as a result of hurdles placed by Multichoice.
Meanwhile, as if what goes round must come around Multichoice is currently on trial at the Federal High Court for copyright infringement in a case instituted by the Nigerian Copyright Commission (NCC), for broadcasting matches of the Spanish La Liga for which it does not have the right. The rights belong to Entertainment Hghway Limited, owners of the pay-TV platform, HiTV.
Only last December, a Nigerian based in Calabar, Eno Ita Bassey, was sentenced to one year jail term for pirating Multichoice’s Supersports signals. The Managing Director of Multichoice Nigeria, Collins Khumalo, risk the same term if found guilty.
HiTV came into the market with affordable subscription fees of N3,000 per month, after an initial installation fee of N25,000, as against the N9,000 monthly subscription and N35, 000 for equipment by Multichoice. The South African company, like its telecom counterparts, MTN, had claimed that the rates cannot come lower than they are currently charging.