Russell Southwood, of telecoms, Internet and broadcast consultancy firm Balancing Act, discusses Africa’s digital migration with Variety.
African governments committed to a digital switchover by June, but few have made the switch thus far. Given the immense logistical hurdles in play — especially with regard to establishing clear guidelines for governments and broadcasters alike — how do you see the transition playing out in the next few years? In your estimation, how soon before Africa as a whole goes digital?
Those countries that have started the digital transition have tended to treat the deadline as the point to start rather than finish. There remain considerable issues around financing the infrastructure and this could mean further delays. The completion of the process could take anything between another three to seven years years.
Sylvain Beletre, audiovisual analyst at Balancing Act, points out figures related to digital terrestrial television. So far six (soon to be seven) African countries have launched DTT — Kenya, Morocco, Namibia, Mauritius, Rwanda, Tanzania and soon Malawi — and have started to cut analog TV off. An additional 16 countries are running DTT alongside analog TV, while 12 countries are preparing to launch DTT soon, and a further 12 are late, while 10 countries are not taking any action in this respect. The leaders in the DTT sector are StarTimes and GoTV. StarTimes is operational in 16 countries and has about 6.5 million clients in Africa, while GoTV covers 10 countries and has about 2 million clients. The total number of client to DTT in Africa today is over 9 million and this number is growing rapidly, especially in countries where StarTimes and GoTV are operational.
In the countries where the transition has been made, who’s footing the bill? Is there a clear roadmap for how much responsibility should be borne by the government, how much by broadcasters, how much by telecoms, etc.?
Broadly speaking, there have been three approaches to financing the infrastructure. Firstly, Chinese pay-TV provider Star Times has secured agreements with African public broadcasters to carry out the process in exchange for getting access to channels to run its pay-TV bouquets on. Secondly, Chinese equipment vendors have bought financing deals with them. Thirdly, governments and regulators are relying on selling the 4G spectrum freed up by the transition for enough to cover the infrastructure costs. Some like Ghana are trying to sell it in advance of it being available to do it.
Almost 5 million homes — or just 5% of the total number of TV households on the continent — have access to DTT bouquets. There’s enormous potential for growth, but those numbers also underscore some of the challenges for the sector (e.g., the prohibitive cost of set-top boxes and digitally enabled TVs). Is there any strategy to ensure that the 100 million households which can potentially access digital TV channels in the near future will have the means to bring that technology into their homes?
Some governments — like Rwanda and Tanzania — made a “hard stop” transition: at a certain point, they simply switched off the analog signal. As a result, a significant number of citizens found themselves staring at a blank screen. Worse still, they announced how many households had failed to make the transition which encouraged advertisers to pay less, as audiences had shrunk. With some honorable exceptions, the governments have so far have failed to 1) run strong public communications campaigns to persuade people to switch; 2) failed (with the broadcasters) to think hard enough about what content would be on DTT platforms to attract people to them; and 3) not instituted subsidy schemes for those unable to afford to buy a set-top box.
Content is king, and quality content will determine the success of the digital migration in any country. Are most African industries developed enough to even provide the amount of quality content needed to fuel this exponential growth?
This is not a simple question to answer. Some countries have considerable capacity to produce local programming: for example, Nigeria, South Africa, Kenya, Tanzania and Ghana. Content from some of these countries is sold to other African countries. The increase in the number of channels in those countries where DTT is under way is beginning to have a modest effect on the amount paid for programming. Nevertheless, in the first instance, international players are much more used to both selling and creating channels, and inevitably a significant number of channels will be international. Beneath the question of whether there is enough content to fill the channels is whether there will be enough advertising to support them, and this will be much more difficult in the smaller countries.
In your report, you offered a direct challenge to governments to encourage and finance local programming. Where on the continent do you see that happening? Will government-mandated quotas for local content make a difference without significant government investment in production? Are there any countries where you see the sort of synergy — government and private-sector investment; adequate infrastructure; a developed pipeline of quality local content — that will allow for the digital migration to reach its potential?
There is production support in a handful of African countries (for example, Kenya, Uganda, Nigeria and South Africa), but it is rarely tied to DTT and the development of the industry. The most developed example of a broadcast and film industry strategy is South Africa, where government funds organizations that finance films; attract filmmakers to their locations; and assist film and programmakers to attend international markets. Most recently, South African animation studios Triggerfish has launched a major Storylab scheme to develop new animation features in association with Walt Disney.