Pay TV operators object to unbundling

2011-11-04 09:42
Thinus Ferreira
Cape Town – South Africa's pay TV operators have rejected the compliance notice issued to them by the National Consumer Commission.

In October the National Consumer Commission ordered South Africa's pay TV companies to perform a so-called "unbundling" of their TV channels which the Commission wants them to sell individually.

Concerned pay TV insiders have told Channel24 that the Commission is misguided and asking the impossible; and that the South Africa's pay TV industry functions on the same global model for pay TV services used around the world.

"Small sardines in a tin can is one product, it's not a 'bundling' of sardines. If people buy sardines one by one they ironically will end up paying much more per sardine because it will cost more to offer them separately," said a South African pay TV executive not authorised to speak on the matter.

Internationally not done

It's currently highly doubtful that even if they wanted to, pay TV operators such as TopTV and MultiChoice wouldn't be able to secure licensing deals for the content to be sold in the way the Commission proposes, since internationally TV channels are simply not distributed in this way.

Vino Govender, CEO of On Digital Media (ODM) that runs TopTV, told Channel24 that On Digital Media intends to reject the proposal by the National Consumer Commission since it would "force us to offer consumers the ability to pick and choose the channels they want to subscribe to".

He says ODM has "taken legal steps to repudiate the commission's line of action because it threatens our business model".

He says if TopTV complies and allow subscribers to subscribe to only a few select TV channels it "could force the only pay-TV alternative to MultiChoice out of business; this will not be in the best interests of the end consumers."

Impossible model to maintain

"We have considered offering pick and mix a la carte options before TopTV launched but discovered the model made no financial sense as content providers would have hiked the cost of channels substantially. The model is also from a systems and administrative point of view impossible to maintain.

"If we remodel our product structure it will cause our business serious harm and could lead to our closure."

Govender says such a move would cost South Africa as much as 6 000 jobs nationally.

MultiChoice feels the same and has also objected to the order from the Commission.

"MultiChoice South Africa has objected to the compliance notice served on us by the National Consumer Commission," says Jackie Rakitla, the general manager for corporate affairs at MultiChoice South Africa.

"We are not in a position to respond to any questions in this regard until the matter has been resolved at the Consumer Tribunal."

Comments

  • Ingrid - 2011-11-04 10:09

    Yes, it's about time. Some of the channels are disgusting and of no interest to the South African market. Waste of money for the consumer, all we can do is pay up or loose out. We have not option.

      Ronj - 2011-11-04 10:16

      Couldn't agree more !!! They have the technology to 'package' programmes/channels, so why not have a few package options based on x-number of channels. Whichever package we choose, we just then fill up the number by handpicking the channels we want for that package. It's not rocket science.

      Kylecreamer1988 - 2011-11-04 10:55

      You're all a bunch of whiners. Cancel your subscriptions and QQ more.

      Ron - 2011-11-04 12:19

      You will end up with a set top box, is that what you want, then government can control what you see and what you don't.... Kick up against this...leave things the way they are. This government cannot leave things be and concentrate on important things like crime levels.

  • Ronj - 2011-11-04 10:11

    Of course they will object. Money-hungry monopolizers !!! Why don't they just allow the viewers to choice and pay for what we actually WANT to see ??? Screw their business models, give the viewers the choice you idiots !!!

      Ronj - 2011-11-04 10:12

      should read, 'to choose'

      Deon - 2011-11-04 11:19

      The viewers will complain much more when the pices goes up.

      Carlos - 2011-11-04 12:19

      Most people get DSTV for the Sport and Movie Channels, some of the most and others also also enjoy other channels like discovery, the variety of music channels, the variety of news channels etc, all subscribers combined bring in sufficient revenue to enable Multichoice to buy all their programming packages at a better price and therefore giving us a better price at the end for all the available channels. if they gave us the option of only Supersport and movies the majority of subscribers would only go for that and we would lose 3 quarters of all the other channels that we browse to when there is no sport or movies we want to see. their programming is not perfect but 9 out of 10 times there is something of interest to watch, that remaining 1 time ,.. do something else, get a life, can't watch TV the whole day

      Mistral11 - 2011-11-04 16:30

      Incedibly short sighted, arrogant and commercially ignorant comments.

      michal.mierzwa - 2011-11-05 14:21

      It all comes down to CONTROL. Governments exercise it and so do multimillion industries.Those in power over consumer are unlikely to nudge unless they see increased profits to shareholders.Very sad but true.

  • Ian - 2011-11-04 10:13

    of course the thieving bastards do, there is no competiton just like telkom, thats why they overcharge for crap and repeats, I would take all the sports channels, cnn and sky and maybe 1 or 2 movie channels universal and tcm, sometimes they make a mistake and put on a new classic, i wish sky would come here and do away with this no choice

      Mike - 2011-11-04 12:54

      The movie channels are utter rubbish, repeats, repeats, repeats. Look at this coming Sunday movie - uteer rubbish - it is for kids who will be sleeping. Mnet and mmultichoice make HUGE profits. Bring down the monthly rates and people will be happy, but we South Africans never moan or complain

  • Peter - 2011-11-04 10:13

    Another example of what happens when certain legislation is not thought out properly and worse is regulated by complete ignorance. I'm tired of the actions of some spineless people who have to run to mommy all the time costing me more money - because they don't think further than their noses! I don't need your help thanks, I am capable of fighting my own battles thanks.

      Len - 2011-11-04 13:43

      Perhaps considering the position of the regulator may help in your obvious confusion. Offering more options will not deny you, the cheap shopper from buying everything including channels you will never watch. It simply means the discerning buyer will be allowed to purchase individual channels without being forced to buy the rest. today, you can purchase an individual song in an album, something that was no heard of before. Your ability to purchase individual songs has created a bigger market for musicians. Same goes for books, instead of relying on publishers to buy over priced books, people can now purchase online versions at lower prices. This will also facilitate better delivery of content. Instead of being glued to TV all the time, people can now spend more time socialising and can get the content they want at the the time they want it. Technology is there. Of course, if someone wants to pay R600 to watch another repeat of Fraser, Friends or 1929 movie, then so be it, but to keep paying more when we want less is not kosher

      Peter - 2011-11-04 17:14

      You are missing my point entirely! Of course I would love to only pay for channels I watch, but the reality is these channels will be far more expensive as a result. The channels are clustered to create economies of scale and while I fully agree pay TV is too expensive in SA, I don't need some consumer activist shouting out the odds and causing me to pay any more. Capish?

  • Ian - 2011-11-04 10:15

    Small sardines in a tin can is one product, it's not a 'bundling' of sardines. If people buy sardines one by one they ironically will end up paying much more per sardine because it will cost more to offer them separately," said a South African pay TV executive not authorised to speak on the matter thers just 1 problem with your comment, the sardines are all rotten and they stink

      Deon - 2011-11-04 11:33

      If it is so rotten don't buy them, they will get the message. I keep mine mostly for the direct sport and newer movies to rent.

      Vernon - 2011-11-04 14:54

      The point is that this anology makes the assumption that all the sardines are the same as would be the case with a bundled bouquet offer.....not true. There is probably only one edible fish and the rest would be discarded, using this analogy. Exactly what happens with their premier bouquet.

  • Fred - 2011-11-04 10:16

    They are lying, of course. Give us the choice - bundled or unbundled. And don't tell us you cannot separate Supersport channels from BBC or Discovery.

      Ronj - 2011-11-04 10:24

      They can seperate. Their business model is nothing more than crappy entry-level packages with crappy channels so that you're 'forced' to buy the full rolls royce if you want the stuff you really want to watch. They still believe that in the year 2011, consumers are stupid. We see right through their money-making greed !!! GIVE ME THE DAMN CHOICE TO HANDPICK THE CHANNELS I WANT, AND I'LL PAY FOR THOSE !!!

  • andreas.sorensen - 2011-11-04 10:26

    Guys, they resell channel packages, not channels. If they buy the "Discovery Networks International Bouquet" they pay perhaps R30 per subscriber and then resell it as part of the premium bouquet. This is the way all TV networks across the world do it, and Discovery Networks will not allow SA operators to do things differently. If they are then forced to allow people to select only one channel from the bouquet, and the majority select only Discovery Channel, what is going to happen? We all pay the same for one channel as we currently pay for all of them! This would not be greed as MC are still paying the same for the entire bouquet!

      Ronj - 2011-11-04 10:33

      Well then it's an easy one andysor, MC/DSTV need to do market surveys to understand the types of packages that the public WANT. Again, not rocket science. Come up with 5 different bouquet packages with say 5, 10, 15, 20, 25 channels (as an example), then do a national survey to see which channels the majority of people would pick if they had to choose a certain bouquet. Then offer those as packages. At least then they can plan ahead, and be sure that at least most of the people would choose a certain bouquet package because of the numbers of common interest. Not rocket science. They just too damn lazy and want to keep controlling. Consumers need choice.

      andreas.sorensen - 2011-11-04 10:48

      RonJeremy, sure, more varied packages I'm all for, but to expect them to offer individual channels (i.e. NO BUNDLING) is unrealistic due to the procuring process as I described above.

      Gerald - 2011-11-04 14:15

      Andysor Yes I agree. What will the public if DSTV do unbundle and charge say supersport 1 R100.00 Supersport 2 R100.00 Supersport 3 R100.00 etc Movie Channel R150.00 Based on movies costing R60.00 in Moviehouse . The other way they can go is like the Pay per view Eg R25.00 to watch one (1) sporting event or movie of a Discovery Channel article. The viewing public now has total choice Only they will now pay through their noses.If one has to watch eg Super 15 Rugby (average 4 games per Saturday R100.00) then a movie on Saturday and Sunday night TOTAL for weekend R150.00 = R600.00 for that month with NO other viewing for that month YES lets go that route like hell

  • dorothy.wodrich - 2011-11-04 10:26

    I have experienced pay TV in two countries outside South Africa - Australia and America. In both countries viewers have choice. There is a basic "bouquet" and then one can choose the additional channels that one wants and one pays accordingly. As a pensioner, I am forced to pay for the Premium Bouquet in order to get the few channels that I want because the cheaper bouquets do not cater for my tastes. I do not have children or teenagers, could not care less about fashion or music videos and cartoons. I do not need 5 sports channels all showing the same sport over and over, but not giving me access to the winter olympics. I have no desire to watch "reality" TV where people are prepared to show their stupidity and bad breeding in public and find the constantly repeated diet of cheeky children, shallow empty headed women, violent men and dumbing down that seems to flow endlessly from America, an insult to my intelligence. DSTV, don't brag about the number of channels you have - quality, not quantity is what we older folk want. Never forget that if it were not for us, our life time of hard work and discipline, none of you younger folk would exist or be able to enjoy what you now have. We made it! We deserve respect and consideration.

      Ronj - 2011-11-04 10:34

      Exactly !!! They have the technology, they just want to force the consumer into a box. We'll all hate them for it eventually. DSTY/TOP-TV, ARE YOU GUYS LISTENING ???

  • dssteyn - 2011-11-04 10:30

    Phone M-Net they care... at least they used to care...

      Jan - 2011-11-04 10:46

      Try to subscribe to M-Net alone.

  • Bruce - 2011-11-04 10:33

    overseas you buy or are given free of charge, a base package and then you buy additional channels/bundles to customize your package to your needs, ie - REAL CHOICE. the packages offered by multichoice are designed so that you need to take the full package or lose out on ALL the top channels, ie - MULTI-NO-CHOICE.

  • RudyRat - 2011-11-04 10:40

    I personally am greatfull to have multi choice as an alternative option to what the SABC throws at us. I dont mind repeats because unlike some people who comment here I work a full day and only really get to watch on weekends so i get to see the programs I miss during the week. I am so sick of hearing people complaining about multi choice , if you dont like it dont get it carry on watching the rubbish channels the SABC dishes out or get a freaken life other than TV. The only reason the goverment is targeting the pay tv like this is because they are hoping that if Top Tv or multi choice comply to their demands they will eventually become to expensive, loose customers and or close down before they bring out the " little black box" with its numerous channels in april. It is no secret that the SABC is in financial trouble due to mismanaged funds thus it will go to any lengths to try and close the opposition down.

      Len - 2011-11-04 13:50

      So, what you are saying is that you cannot give a damn for the people who happen to be home, but are subject to repeats and they do mind? They pay as much as you, but you feel they have less rights? What about buying a PVR and record these programs you expect to miss, while you are busy working? People here complain because just like you, they want value for their money. If people did not complain, I have no doubt you woulk be paying R1000 for nothing. Complaints are what make service improve.

  • madeleen.richardson - 2011-11-04 10:41

    We do not have DSTV because as pensioners, we find that to watch what we like we would need to take the premium option which is beyond our budget. We do have M-Net and CSN, but find that we still are not able to see the sports programmes we would like and that the monthly guide, especially for CSN, is usually a hit and miss affair and the programmes advertised are seldom what is actually shown. I am sure that if the viewer had more choice in selecting channels, more people would subscribe to DSTV.

  • Philip - 2011-11-04 10:47

    to hell with DSTV and news24

  • Adrian - 2011-11-04 11:13

    I feel that the Compact bundle could at least have a cricket and a rugby channel instead of 4 soccer channels! And what about all those news channels in Chinese? I don't even watch them.

      don.ruffels - 2011-11-04 11:44

      I agree with you, they throw soccer at us, but alas if you subscribe to compact - you get no rugby, no cricket - but soccer is forced on those who could not care about soccer. equal sport for equal viewers please.

  • Bazzpete - 2011-11-04 11:33

    Reaction proves how greedy pay TV operators are!! I have no interest in 10 reality TV channel, 47 cooking channesl, Other Continental African country TV channels (with respect to those subscribers who might be) and channels where programmes are repeated daily, weekly monthly. Give the choice of what I want to watch and pay - shove the rest of the rubbish on free to air because you know damn well where your profits are made!!

  • Oliver - 2011-11-04 11:37

    yes, the sardines are representative of the content of 1 channel, but i can still choose how many sardine cans or other fish/meat/fruit/jam etc i want to buy. pnp does not make me buy 10 other canned products to buy 1 can of sardines, you muppet.

  • dave.leverton - 2011-11-04 11:37

    "The model is also from a systems and administrative point of view impossible to maintain." A blatant lie - take a look at TataSky TV. Choose the channels you want and the cost is minimal.

  • Rob - 2011-11-04 11:37

    I asked Multichoice about 'selective' bundling, their reply was that it IS feasible, but it will mean much higher costs. Consider this....Check all the channels available: what % is of REAL interest to you (20% for me). Now check what % of the material accross the interesting channels is of REAL interest to you (10% for me). Now you can see just how much of the material is really interesting (2% for me). I have reduced my bundle to one of the smallest just to get News and Weather. Next month I will cancel the subscription because I now have ADSL and can get all the News and Weather I want on my PC. Surely it is worth paying more if you get something useful?

  • Susan - 2011-11-04 11:48

    I find these comments hilarious - one would swear that Pay TV is a basic commodity and not a luxury. It's like getting angry with Ferrari because it cost you so much to buy one, but you really wish they would produce one with a 1.3L diesel engine and soft cloth seats because that's all you needed.

      Len - 2011-11-04 13:57

      Let us say you go to a hospital to give birth, Susan, but your hospital tells you that you cannot simply choose a birth ward, you will have to take a labotomy, physiotherapy, facial reconstruction as a bundle. They know you will not use these others, but they still want to charge you the full amount, even though you just wanted to check into the maternity ward. Yes, the others maybe a luxury, but there are a couple of channels that are not. I would rather my child watch sport than be outside and being up to something no good, but do I have to pay an arm and a leg for that?

      Susan - 2011-11-04 14:17

      all Pay TV is a luxury Len...Saying that, I do believe that consumers are fully entitled to complain about a service that is not delivered as promised. What I find baffling is how people pay for a service that is delivered to them as promised and then they whinge about about how much it costs them and that it's not really what they want! When I can't afford something, I don't buy it, simple as that - DStv has fallen into this category at certain stages in my life. Perhaps it's just a case that the entitlement culture in this country has now spread to the basic level of entertainment that a person is willing to accept.

  • hilton.preston - 2011-11-04 11:49

    if the end product costs less and is what the consumer wants, then the 6000 jobs lost is totally worth it!

  • justin.pretorius - 2011-11-04 11:55

    I don't agree with ODM and MC on this. I think they should open up their pricing for the Commission to see. So what they are saying is that they get a discount from overseas for taking a bundle? Wait until the internet gets cheaper here and MC and ODM will be history as you can stream most of these programs anyway. Only Supersport will be the anchor for most subscribers

  • onegreenparker - 2011-11-04 11:57

    it would "force us to offer consumers the ability to pick and choose the channels they want to subscribe to". Yes, force the operators to listen to the consumer of the media. If the fact that consumers prefer to pick their products is a revelation, you are in the wrong business

  • Johan - 2011-11-04 12:00

    Out of the 200 odd chanels on DSTV we watch maybe 15. Sure, if they put a price on each channel, my bill will decrease allot, but 10000 other families that could never afford DSTV in the first place could now sign up! I think DSTV will still score.

  • pmolesworth - 2011-11-04 12:01

    Yes but I eat the whole can of Sards in a sitting, I don't select one sard and throw the others away because I can only eat one at a time....It's not a case of opening the tin, selecting one and throwing the rest away or selecting one and throwing the rest of them away cause I don't like them...

  • kgalalelo.malesele - 2011-11-04 12:15

    u must unbundle how dare you force rubbish channels on us and ask us to pay for them......i mean i have islam tv and i dont know where to start with it......STOP YOUR FOOT FOOT NONSENSE AND UNBUNDLE I HAVE TO PAY FOR WHAT I WATCH FULLSTOP. GONTSE GO LEKANE MANE!!!

  • Ryan - 2011-11-04 12:21

    its called business. its not a monopoly. there is no problem. sure it would be nice to pick only the channels i watch but hey. why doesnt the regulator start a business that allows the consumer to pick the channels he/she wants. muppets

  • Renny - 2011-11-04 12:26

    I wish I could cancel the SABC channels.

      Klipkop - 2011-11-04 12:48

      Dont you like Noleen or Die Nutsman? Come on that is top quality TV. Just kidding.

  • Jdcptza - 2011-11-04 12:46

    Quite right, Its because they are GREEDY and dont want to stop!! If i buy a boquet, why should i be forced to have for example a Muslim channel if its of no interest to me. But i know why, its clever market segmentation, they know that, the channels the biggest market is going to want, is included in the most expensive boquet and they wont, allow piecemeal purchase!! SMALL TOWN THINKING!!! GREED!!!

  • comurray - 2011-11-04 12:50

    I presently have premium DSTV and only watch the channels of my choice which amounts to a quarter of what I'm paying for. So why can I not just subscribe to those channels only it would ruduce the monthly cost to around 150 rand which would be acceptable.

  • Paul - 2011-11-04 12:51

    Subscribers with the latest TV phones are able to get a mobile DSTV bundle for R39pm, while older 3G phones get an inferior selection costing R59pm. At the very least I should be given the option to select some portion of the channels myself for R59pm. In addition this service appears to be over-subscribed as one usually battles to connect during peak viewing hours.

  • Chris - 2011-11-04 13:14

    I totally agree, why should I pay for channels that I NEVER watch

  • Richard - 2011-11-04 13:31

    Multichoice has been taking us for ride for far too long- its time for a change - they do not listen when we complain now they should pay for not giving value for money. Let us choose what we want not them!!

  • Len - 2011-11-04 13:36

    There was a time when you could not purchase an individual song. you had to buy an entire album in order to enjoy the one song you wanted to listen to. The album would cost about R100, whereas the song would be worth R10. Even if the song were to individually cost R25, it is still a far cheaper deal than to spend another R75 on crap you do not want. If you ask most South Africans, they would be willing to pay more for less programs. I now pay over R600,00 per month for a bunch of channels I can never watch even if I had the time. Many of these channels repeat the same programming. So, I am paying top money for products that derive very little value. Music producers had the same argument against undundling in the music industry, but guess what, music is still a lucrative industry and musicians still make a living, but now singles are far more important than loading a stupid album with worthless songs. I only subscribe to DSTV because of the sports. I would not bother with Top TV because chances are that I have seen what they show. How they bundle it is immaterial. You can spray cow dung with cologne, but it remains cow dung.

  • Iwan - 2011-11-04 13:37

    My family only watch ±five channels: SS1 and SS2 (Me) CBB's and Disney Junior (Daughter) and Home (Wife). Maybe the odd movie or History every now and again, but I can't see why we must pay for the rest. There's really some useless channels on there.

  • Piet - 2011-11-04 13:52

    So all you whiners! Give up DSTV for one month in protest!!!!!!

  • Enockay - 2011-11-04 14:01

    just a dream that will never happen,bundling is how DSTV makes moola.....I could live with just their 6 HD channels and ur SABC....but aint gonna happen in this lifetime,

  • Enockay - 2011-11-04 14:02

    just a dream that will never happen,bundling is how DSTV makes moola.....I could live with just their 6 HD channels and ur SABC....but aint gonna happen in this lifetime,

  • Enockay - 2011-11-04 14:03

    just a dream that will never happen,bundling is how DSTV makes moola.....I could live with just their 6 HD channels and ur SABC....but aint gonna happen in this lifetime,

      Len - 2011-11-04 15:11

      I felt the same way about music, but now I can download one song. Things do change. Even on DSTV, you can purchase one movie (even thought it will be on DSTV in a couple of weeks)

  • tina.joubert - 2011-11-04 14:27

    Are they objecting or refusing...? We get ripped off and we have to take it? No more, I'm glad someone is saying something. If there will be a result seems unlikely, probably just a bit of noise to subdue the masses (since we live in a free country) and make us feel like we actually got something done. It's a big joke, the powers that be won't do a thing because they don't notice R600 a month debit order - why bother!?

  • Len - 2011-11-04 15:09

    My bank charges me a bundled price, as well as individual price. When I took the bundled price, I had access to a variety of services some of which I had no need for attached to a couple that I wanted. Eventually, I decided I will go with the individual banking fees even though they are more expensive per item. For me, it ends up cheaper and I no longer subsidise someone who uses the safety deposit box, or get their cards decodared with a nice blue ribbon.

  • lynettevoostrum - 2011-11-04 22:06

    It seems that people don't realize that unbundling channels is not going to cost less, per individual channel you are going to pay more meaning you may well be forced to give up some of your favorites not to end up paying more than you are already paying, for less. What's more content is also going to suffer. The commission's idea might be to force pay tv companies to adopt this system to open up pay tv to the masses. Unfortunately pay tv internationally is there for those that can afford it... that is why it is called pay tv... for those that cannot afford it there is state tv! This is the international norm, why should we deviate from this and end up with a lesser product! DSTV is one of the best in the world, we should aim at keeping up its high standards and not give in to third world 'ubuntu' ideas... there is and has never been 'ubuntu' in luxury products!

  • Hugh - 2011-11-05 06:59

    what I object to is the number of useless free to air programmes that are included in these bundles. For the most part the number of repeats is rediculas and and not woth the money.

  • richard.pritz - 2011-11-05 07:57

    Poor excuses from the tv operators. It's about time consumers had a greater choice. Like the motor car industry move away from the idea of offering a black model T and provide consumers greater choice. Change your business model to one that offers more choice to meet consumer needs and if necessary charge more for this greater choice. OR Let's have more competition by allowing more players into the market or promote internet subscription

  • goyougoodthing - 2011-11-05 08:42

    thepiratebay.com isohunt.com btguard.com problem solved

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