SA’s communications authority will soon conduct an inquiry into  regulations that compel pay-TV operators to carry the SABC’s free-to-air channels, and whether this should still be done for free.

In 2008, the Independent Communications Authority of SA (Icasa) introduced “must-carry” regulations that force pay-TV companies to carry the SABC’s free-to-air channels — SABC1, SABC2 and SABC3 — to support universal access.

However, the SABC which is desperate to unlock new revenue streams in a bid to remedy its dire financial situation, argues that the rules have had a serious negative impact on potential revenue. .

The public broadcaster, which is the main source of news and commentary for most South Africans, is on the brink of collapse and has warned that it could be forced to go off the air at any time unless the government comes to the rescue soon. It has requested a R3.2bn government guarantee to stay afloat, but its bid for funding has so been unsuccessful. 

Executives at the public broadcaster told MPs on Wednesday that without the legislative changes such as the must-carry regulations and reduction in signal and distribution costs the entity will have a cumulative net loss of R1.5bn from the 2019-2020 to 2021-2022 financial years.

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The broadcaster has crippling debt of almost R2bn, an enormous infrastructure maintenance backlog, and a huge and unsustainable wage bill.  

MultiChoice has previously stated that it is irrational for the public broadcaster to now require its DStv bouquet to pay to carry the three channels as they are freely available in any case. But the SABC argues MultiChoice has benefited from the channels on DStv, claiming they are among the most watched on the platform.

Icasa said that it will conduct an inquiry into the must-carry regulations' efficacy before deciding whether they  should be amended.

“These are the findings of the regulatory impact-assessment process which commenced in September 2018 following a number of complaints from the public broadcasting service licensee, resulting in the need for Icasa to consider the effects of the regulations and further consider the need for their review,” the regulator said.

Icasa said the regulatory impact assessment emphasised its initial position in the regulations that the SABC would deliver the signal to the subscription broadcasting services at its own cost (the cost of producing their content in a readable format to pay TV operators); and the SABC would incur the cost of broadcasting, that is the transmission costs, which include fibre-contribution costs and satellite-capacity costs.

“It was on this premise that the different wording of ‘at no cost’ in the regulations came about in an effort by the [regulator] to be nondiscriminatory and fair and to ensure that universal access was prioritised over financial gain,” Icasa said.

The regulator said it cannot make a conclusive finding at this stage on whether the resultant implementation of the regulations on costs warrant an amendment, “therefore [there is] a need for further consultation and to conduct an inquiry into the effectiveness of the regulations and possible review thereof”.