DStv, TopTV ordered to change contracts

2011-10-21 14:24
Thinus Ferreira
Cape Town – The National Consumer Commission has told DStv's operator MultiChoice and TopTV's operator On Digital Media to amend their current contracts with subscribers which the commission says do not apply with South Africa's new Consumer Protection Act.

In a move that could have serious repercussions for South Africa's pay TV industry, The National Consumer Commission also wants both South African pay TV operators to break down the channels in its bouquets and give subscribers the choice of a la carte channel subscriptions.

The Commission has issued compliance notices to MultiChoice and ODM.

The National Consumer Commission wants MultiChoice and ODM to allow subscribers to pay for the specific TV channels they want, and want the DStv and TopTV channel selection to be grouped into genres.

TopTV told Channel24 on Friday that the operator can only comment at a later stage.

"We are engaging with the National Consumer Commission on some procedural aspects," said Thato Mahapa, senior manager of regulatory affairs at TopTV.

"We have not yet taken a decision or adopted a view as regards the signing of the notice or opposing it."

Jackie Rakitla, general manager for corporate affairs at MultiChoice South Africa, told Channel24: "We have received a compliance notice and we are currently considering it".

Bundling services or offering a product?

South Africa's Consumer Act prohibits the bundling of services. The National Consumer Commission seems to regard the offering of separate TV channels together as a single product as tantamount to bundling services.

The pay TV model that South Africa's operators follow – similar to the practice worldwide – is to aggregate TV channels that would simply not be economically viable as singular TV streams.

How the worldwide pay TV model works is that more popular TV channels and content actually subsidise less popular TV channels in order to offer a product. Because of scale and the number of subscribers, operators can offer a selection of more watched and less watched TV channels to cater for a wider overall variety of programming taste.

Smaller channels will disappear

While a so-called "a la carte" channel selection would theoretically be possible, it will actually cause pay TV operators to increase the individual price of TV channels, especially popular ones.

For instance: While subscribers would be able to subscribe to just a SuperSport channel on DStv or just a Fox channel on TopTV, less popular channels will completely disappear because of a lack of demand.

Meanwhile, news channels, kids channels carrying less commercial advertising, and less appealing channels that still deliver unique content and cater to a niche audience will disappear, leading to less choice and less overall programming diversity.

No DTH (direct-to-home) pay TV satellite operator in the world currently has the back-end technological infrastructure to organise and customise unique channel selection sign-ups to hundreds of thousands, if not millions of individual subscribers. 


Comments

  • dssteyn - 2011-10-21 14:50

    At last, lets hope some sanity prevails here...

      nasheenar - 2011-10-21 15:16

      I can hope this is in the consumers best interest.

  • wbschorn - 2011-10-21 14:57

    will never happen....

      sean.redmond3 - 2011-10-22 08:14

      Money under the table will happen.

      Silver999 - 2011-10-22 10:35

      But isn't it the same with Medical aids? Look, I know this is off topic to some degree, but the same principle applies to MA's. They have various "plan" (may as well call them bundled services) options, and as soon as you choose the one the assists you most with your day to day medical expenses you pay through your nose. Let's face it, how many times do you have huge hospitalisation costs in your lifetime - only the very unlucky have to go to hospital on any kind of regular basis. Add up the premiums you pay over a 5 year period and ALL the costs paid out by your medical aid - you would be surprised at just how big the difference is - some of us could pay our houses off or at least buy a luxury car! But hey, let allow THEM to bundle services, even if you don't need psychiatry now, you may need it when you realise how you've been ripped off over the years.

  • raylene.lewis1 - 2011-10-21 15:03

    I will keep my fingers crossed,it's about time we get value for our money!

  • Ed - 2011-10-21 15:14

    I have 100's of channels of which I only watch about 6. I agree selective bouquets are good but good is not a prerequisie for action in SA so nothing will happen!

  • David - 2011-10-21 15:17

    will end up paying the same, if not more, since the individual channels will cost more. think this might just be worse for consumers

      Utopian - 2011-10-21 16:43

      At last, someone who understands this. The regulator is nuts and we shall, as usual, pay for the consequences.

  • francie.potgieter - 2011-10-21 15:20

    Do you want DSTV & TopTV to go the same way as the SABC, because that is what is going to happen if they carry on like this.

      seymore.butt - 2011-10-21 16:08

      No it will not be the same as SABC...here consumers will PAY to watch a channel and if they don't like it they will stop paying for it. Which means those good for nothing channels need to up their game or vanish into thin air. Most people watch handful of channels and the big bundle only increases the number of repeats and you are charged more just to boast that you have 100 channels on your TV (96 of which are useless)!

  • Mandla - 2011-10-21 15:22

    This will be negative for South African programmes. We all want to see American and British acts and this might make our own programmes the last choice in our selections.

      leon.homan - 2011-10-21 18:59

      It all comes down to quality Mandla. If a local show is good, I'd watch it.

  • Julian - 2011-10-21 15:26

    Its about time

  • Justin - 2011-10-21 15:42

    Outdated South African laws if implemented, will only result in us all paying more, and the dissapearance of the niche, novelty programs, like cooking, religious, and travel channels. This cannot happen. The only answer is that SA must update the laws...

      ctrhorn - 2011-10-21 17:03

      this is an updated law! possibly aspects of it might need to be revisited...

  • Skottowe - 2011-10-21 15:46

    constant remarks that "nothing will happen" encourage the powers that be to sit back and do nothing, because nothing is expected! I think this is a damn good idea and cant wait for it!

  • Fran - 2011-10-21 15:50

    Is about time. Dstv should just behave like they do in a restuarant where people choose what they want to eat and not be told that we are so sorry but we only have one menu for you to select from. I would like to pay for caviar if I walk into a seafood restuarant and not be told am not allowed to because is out of stock? We buy services and we shouldn't be forced to watch what they sell but choose what we want period.

      theolienv - 2011-10-24 16:42

      I agree Fran. Why should we pay for channels that we don't want? Let us pay only for the channels we want, like we do in a restaurant. When u go buy your monthly shopping, u pay for the items u selected because that is what u want/ need. It is our right as consumers to demand this.

  • kingswing69 - 2011-10-21 15:51

    about time . i have been saying this for years but the people at DSTV are brain dead

  • multimaxman - 2011-10-21 15:53

    Here is another thing they gonna get skewed for soon: When you subscribe to DSTV they take a deposit from you, but if you make a late payment(even if it is just a day) they disconnect your service, but technically you are not in arrears and they don't stand a chance of loss because your deposit is their security. Then they charge you a crazy reconnect fee????...how does this fit into the CPA? I'm waiting for them to disconnect that thing this month and you will find me at the consumer commission.

      Yusuf - 2011-10-22 09:29

      simple,dont subscribe to things you cant afford

      multimaxman - 2011-10-22 11:35

      @Yusaf, you are narrow minded. Nobody said we can't afford it. Not everybody gets paid the same time of the month. It is nothing more than extortion on DSTV's behalf. I have tried to move my payment date and they refused. simple.

  • andy4real - 2011-10-21 15:55

    I say this is long overdue.. Why should I pay for channels I don’t like or watch......... if the other channels disappear due to no one subscripting to them, that a good thing,.,,, They should stop broadcasting boring stuff, and focus on their target markets by offering value for money.

  • seymore.butt - 2011-10-21 16:03

    "No DTH (direct-to-home) pay TV satellite operator in the world currently has the back-end technological infrastructure to organise and customise unique channel selection sign-ups to hundreds of thousands, if not millions of individual subscribers." Go to India and see TATA doing exactly that...millions of subscribers able to pick and choose only the channels they want.

  • ron.lawrance - 2011-10-21 16:03

    Lets hope they also get to correct the way they prompt you to pay the month in advance subscription when paying by card on the internet. They say it is the subscribers duty to check and amend if it is not the amount they want to pay. What a load of bull.

  • Jackie - 2011-10-21 16:23

    where there is a will there is a way. DsTV and TopTV know that this is possible. its about time we get rid of all the crap programming we are forced to watch because of the grouping of channels into funny bouquets where you find that only 3% of the channels appeal to you. let them run a survey gauge what sort of channel groupings appeal to their wider audience and then go with the more popular ones. at-least that will go some way into showing that they are not just chasing profit but care about their viewers. we are tired of repeats too, this is possibly another reason why we end up watching less popular channels. we are tired of mediocrity.

  • Utopian - 2011-10-21 16:39

    Why don't the regulators spend our scarce resources on a real problem like government corruption? TOPTV renders extremely good value for money and this will just increase their costs. Furthermore, bundling advantages local content such as education tv and KZN, which will now disappear. Are they nuts?

  • Marc - 2011-10-21 17:53

    The idea that consumers pay for only the DSTV or TOP TV channels they are prepared to watch will mean that the channels that they we are not prepared to watch will disappear. In the end consumers will be paying much more for much less, go figure. When we pay our Radio or TV licence we are in effect paying the SABC for a so called "bundled service". Linear programming like TV or Radio is unfortunately not easy to manage when you are a consumer that wants choice and thats a fact. The consumer council unfortunately have got it wrong here. What will happen when the SABC come online with DTTV? Will you only pay for one SABC, ETV or MNET channel individually? Firstly the public "free to air" channels as we know them will all but disappear for millions of people in this country come the analogue shut off in 2013 and we will have a situation that the consumer will pay more less with a revenue stream will be dictated by an audience who has less disposable income and less to choose from because he is not allowed to purchase so called "bundled services." What will probably happen is that you will pay a nominal amount for 25 or 30 DSTV channels and then pay a lot for each additional channel you want to view. What they are doing here is flat out not good for the consumer or for the broadcasters, the consumer council have no idea what this industry is about. True Video On Demand is the only way that they can achieve this and that will ultimately mean the demise of TV as we know it.

      adrien.mcguire - 2011-10-22 13:30

      I am not sure you are totally correct in you assertions. DSTV have created bundles but have kept certain products like Topsport for only the premium bundle. I do not watch soccer ever but I have to pay for it. I believe that at least they need to be more flexible with their bundles to allow a bit more choice and flexibility. This way it will satisfy most people. I believe , in the main, the Consumer council is on the right track, but there needs to be a fundemental shift in the business paradigm. Whilst we are consumers of entertainment we are also targets for advertisers and therefore should be rewarded for that. I will give you an example... I find it distasteful that the Saturday Star is more expensive than the week editions. There is less to read but it is loaded with Property advertising. This advertising is paid for and yet we have to pay for receiving it. If advertisers want to reach us then they must pay for the privelege. I am tired of incessant repeats and endless advertising during programs like Xfactor and Carte Blanche when I am paying to watch the program. Look at your Phone contract where you are FORCED to pay for things like CLI etc that you don't want. That is not right.

  • Freddy - 2011-10-21 18:02

    Guys ur all nuts! Why should we pay for that krap anyway??!! In europe u get 170 channels, and some of them are realy good once for free!!!! U just connect and pay not even 100 bux a months for it!! Get rit of this money making crux!!

  • Roger - 2011-10-21 18:53

    I have been saying this for more than 5 years! Why could we not choose what we wnted? I did not really want to view Chinese / German / Portuguese / Greek / Arabic etc etc channels, so WHY DID WE HAVE TO PAY FOR THEM. Roger Bramford

      Ax - 2011-10-31 19:03

      yeah, i dont want to see all those religious channels and nollywood and bollywood, why should i ppay for them.

  • JohanSmalNaboomspruit - 2011-10-21 19:20

    Why is it that a Tavern package enables all channels except that which shows rugby for only R98. To be able to watch rugby you have to have the full package at R559 or something around there. That in effect means they charge around R460 for viewers to be able to watch rugby. Tavern packages are taken by all taverns, meaning no black viewers for rugby. Is that how the government is promoting rugby among black people?

      gino.depeers - 2011-10-22 11:03

      I just love it...http://ginodepeers.blogspot.com/2011/10/dstv-mnet-where-did-all-magic-go.html especially since I was not happy with the service

  • Chris - 2011-10-21 22:53

    These guys cry about not having the software to drive this sort of demand. In fact they do have it and all it would require is a software upgrade to every box on the system. They then switch everyone off and wait for them to view a program whatever it might be. Your decoder then reports the usage and they bill you for it. Your decoder can also report to you what services you have used in any given month. Their will have to be an availability charge for the service and then also a predetermined maximum that one is prepared to spend. Okay who is going to pass on the bad news to these robbers?

      Henk - 2011-10-22 09:40

      @Chris - How will the decoder report back about what you are watching? As far as I know the dish is only a receiver and has no transmission capability. I have about 10 favourite channels and the only thing that bothers me is the fact that I have to skip through numerius channels to get from one to the other. I would like to have ONLY those 10 channels, numbered 1 - 10.

      Madelein - 2011-10-22 10:55

      I assume that you are the lead technical designer and developer at DSTV with all this inside information your have???

  • William - 2011-10-22 06:21

    It’s actually all rubbish... Sorry... My TV broke 2 years ago. For sport I pop off to the pub, for entertainment, I visit my friends, and for a good movie it’s off to the local bioscope... In truth way more expensive that TV subscription but way more fun too. –and talk about on demand! Turn off dudes.... get a life! My relationship my home/work/social life improved... I am just about half way through a Zulu language course and picked up the guitar again... TV is a thief. Funny thing was... I went to a dentist and whilst in the chair I watched a program on Discovery channel I saw 3 years ago! It just looks like all channels you select will be re-runs like this... they are scratching the bottom of the barrel man.. Seriously, this is not worth the R600/month... or even R 40 / channel (or whatever). In effect, let the subscriptions lapse, find a good book, a course or better still just spend time with your family – outside under the stars. Love Life! Sala kahle!

  • peter.vanachter - 2011-10-22 08:08

    Again our government is in things they just have no idea about, but hey whats new, just look at SABC and the disaster that has become..

  • Wesley - 2011-10-22 08:16

    What about SABC - I don't watch SABC, but have to pay

  • muhhamedvefa.dag - 2011-10-22 08:45

    dstv is the worst tv's channel ever .. they are too expensive and repeating same movies 500 times in the month.

      Yusuf - 2011-10-22 11:12

      AS COMPARED TO?

      Ashibar - 2011-10-23 11:07

      What are you comparing with? I find your comment strange but I hope you are not comparing with Toptv

  • Jaco - 2011-10-22 09:27

    Finally, let's hope they go through with it and not just get our hopes up. There are so many useless channels that nobody ever watches, so might as well get rid of them and let us choose what we want.

      Ashibar - 2011-10-23 11:10

      Is there any time frame for this to be implemented?

  • Christopher - 2011-10-22 09:30

    About time!

  • psk2004 - 2011-10-22 09:39

    Its a great idea, but needs further investigation, the public should have more say in what they watch and what they pay for.

      Ashibar - 2011-10-23 11:12

      But I still support the idea that one should only pay for what they want to watch not what is just given.

  • Raymond - 2011-10-22 10:09

    dstv deserve everything they get thrown at them, they are an arrogant, uncaring bunch of people who only give lip service to their customers,,,, i hope the top management crap themselves. TppTv should get a boost from this,,, i hope they take note of the customer hatred that dstv have earned for themselves and make sure they learn a few lessons.

  • Guy - 2011-10-22 10:52

    looks to me like some service providers are not paying their dues to the party!

  • gino.depeers - 2011-10-22 11:02

    I just love it...http://ginodepeers.blogspot.com/2011/10/dstv-mnet-where-did-all-magic-go.html especially since I was not happy with the service

  • Philip - 2011-10-22 11:35

    always excuses ... why can the rest of the world do it. you can get any single channel on BSKYB and have your package customised to your individual needs. These companies just squeeze everything they can get ..

  • Zion - 2011-10-22 14:27

    How will SABC and their licencing come into the picture. currently SABC has only 3 channels available to the South African public. They have promised another 18 channels soon to be aired. SABC will probably have a different contract than the other 3 due to its ties with the government and the ANC meaning the public will be had again with a likely steep increase in licence fees to subsidise what is coming while according to SABC news the parastatal is practically bankrupt. (Blade Nzimande's wife's salary is R4.2 million per annum.)

      Ashibar - 2011-10-23 11:27

      She get R 4,7 millions, damn what the hell? What are they pay her that much for? That is why I will never ever pay Tv lincense. Am looking forward to see how will SaBC fit in this proposal?

  • Margi - 2011-10-22 16:25

    As a pensioner, I have been told that DSTV are unable to have a pensioner's discount, as it is too open to cheating....yet the TV licencing department has offered one for years without any drama??? That is slightly beside the point but I wanted to get it across anyway! But now I am forced to pay for the premium bouquet , as the choices the other packages give me do not suit my viewing choices. AND would sombody explain to me why all the packages include TV 1:2 :3 and Etv.......I get those anyway by paying my licence I guess its still all down to the fat cats at the top and bugger the rest of us who are basically paying their salaries?

      Ashibar - 2011-10-23 11:30

      I think the are many ways the could have done that but they wanted to take from you pensioners.

  • christo.cilliers - 2011-10-23 09:52

    yeah and pigs have wings? Please ... when companies have a monopoly on a market, they will pull ALL the bunches to maintain their market share. I am sure the powers that be are being silenced some way or another.... It's nothing else but the proverbial dangling of the carrot in front of the consumer to part with more money to gain more subsciber. There is no such thing as bad publicity... ANY Publicity is good for these media types....

  • Moe - 2011-10-23 12:52

    It's about time we have the choice, Viva consumer protection Viva

  • Preshen - 2011-10-24 07:39

    I rather download AVI from internet

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