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Monday, December 22, 2014

Digital Migration Must Not Be Delayed Any Longer

The real analogue-to-digital switch over is set to take place in Nairobi at the end of this month. Broadcast transmission will shift to digital signals.
It is a transition that is expected to have a significant impact on the way we receive information, as anyone in Nairobi without a digital set-top box will not access television channels.
This process is coming more than a year later after court cases kept delaying the move from the initial date of June 2013. Digital migration must not be delayed further.
Some litigants, notably the owners of some of the big TV stations in the country, have threatened to go to court again, or to pull their signals off air, rather than transmit them on the two digital distribution platforms licensed earlier: state-owned Signet [through the Kenya Broadcasting Corporation] and Pan African Network Group, a Chinese firm. The TV owners have been granted a licence to distribute signals as well.
It is easy to see why they have kept delaying this process.
For starters, they have enjoyed an almost cartel-like environment for broadcasting and have had the muscle to roll out coverage across the country. For this, they have been charging high advertising rates, while stating audience numbers that few advertisers can ascertain.
It has also helped that analogue TV frequencies have been limited, so the threat of competition has been minimal.
With digital migration this landscape shifts dramatically. To begin with, the migration separates signal distributors from content providers.
Secondly, each analogue frequency yields about 18 digital frequencies, dramatically opening the field and lowering the entry bar for competition.
Third, digital platforms mean advertisers can better track the actual number of viewers on each channel, hence make more reliable investments in media buying.
That this process has taken this long to implement is testament to the business-unfriendly environment brought about by litigant-friendly courts in the country. While it is understandable that broadcast TV station owners needed a bit of time to assess the changing business environment, it is criminal to hold development hostage for that long in their interests.
The country has lost a lot by delaying the migration process, particularly in terms of new investments, denying young creative minds outlets for their content, and digital dividends that we expect to result from frequencies that are freed up after the switch-off.
These are frequencies that can be used to increase mobile technology and penetration to remote areas, boost internet access and so on.
Further, there are investors who actually sunk in money with business projections pegged on the original deadlines set by the regulator, but have now had to revise these because of endless delays in the process.
Multichoice Kenya and StarTimes Media not only spent money acquiring expensive content, but also in importing affordable digital set-top boxes and millions of shillings more in marketing and activating these products.
Multichoice has, for example, invested heavily in Africa Magic channels, developing content tailored to the local market and making use of local talent. However, until migration is effected, the larger pool of audience it had in mind will not materialise.
Lastly, with new technology, you never know what innovations will come up and, maybe, we have denied a lot of talent take off.
Shows like Churchill Live give a platform to new and upcoming comedians. Who knows, with more channels available, the show could be the basis of our own Comedy Channel featuring all these artists in full version instead of cramming them in a 45-minute slot.
Another reason that the migration should not be delayed further is that TV owners took part in the original bidding for a signal distribution licence. According to the Communications Authority officials, the bid they put in was shoddy and they lost.
Should projects be delayed because a losing bidder demands that they must be part of it even when they show lack of technical capacity?
They have now been granted a licence. However, how long will it be before they roll out services? First, they need to bring in the technical expertise. Then, they need billions of shillings to roll out national infrastructure like Multichoice and Startimes have done.
They will also need to buy competitive content to get people on their platforms. How long will this take and should we wait for them to get their network running before Kenyans can be allowed to migrate?
What TV stations should concentrate on is getting the right content. Investing in this, rather than seeking to control infrastructure, is inherently more central to their core business and will likely bear them higher profits.
TV stations in the US such as CBS, Fox, ABC and NBC make their bread and butter from commissioning cutting edge TV shows which Kenyans buy off the streets as ‘movie series’ or in broadcasting rights for popular sports like NFL, NBA and so on. Others like
Showtime and HBO are pay-channels, which carry exclusive material and have no adverts.
Whichever model our TV stations choose, they should do so as we migrate on December 31, not delay the switch-off.
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[This article first ran in The Star.]

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