TopTV to 'rattle' DStv with Chinese investor

2013-04-18 14:03
Thinus Ferreira
Cape Town – StarTimes, a Chinese media group ready to bail out the struggling TopTV wants to take on MultiChoice's DStv by slashing pay-TV subscriptions, dramatically improve pay-TV content and "rattle" the South African pay-TV market.

On Digital Media (ODM) which runs the South African satellite pay-TV service TopTV and is looking to stave off liquidation, has published its Business Rescue Plan together with China's StarTimes media group.

StarTimes is planning a massive overhaul of "failed" TopTV if it gets the go-ahead to funnel millions into the beleaguered loss-making operation.

The Business Rescue Plan names StarTimes' interest in acquiring a stake in TopTV as the company's only and last chance to stave off liquidation. South African broadcasting regulations currently cap foreign ownership on licensed broadcasting entities at 20%.

StarTimes says in the TopTV Business Rescue Plan that it wants to "rattle" the pay-TV market "which is currently covered by two other digital television providers in Africa (one other in South Africa) – referring to MultiChoice.

Quality pay-TV programming at half the current cost

StarTimes say it wants to offer "pay-TV services at half their current costs and let ordinary South Africans pay less for good quality digital television".

Star Times wants to help make TopTV a "strong competitor in the pay-television environment currently monopolised by one player," says TopTV's Business Rescue Plan.

The financially distressed ODM is now hoping that China's StarTimes media group will be able to become the new equity partner the Woodmead company desperate needs for a major capital injection.

StarTimes plans to "implement a complete restructuring of TopTV's affairs and business and debt" if it gets the go-ahead to bail out TopTV and and wants to install its own CEO, and a CEO who have been a previous employee of StarTimes.

The Business Rescue Plan warns that job losses may occur and states that should StarTimes not be given the go-ahead, that "a liquidation of the company will be inevitable".

Tremendous potential to develop pay-TV in SA

StarTimes says its aim is to "give every South African family the opportunity to own digital television" and already run pay-TV packages with bouquets of up to 140 TV channels elsewhere on the African continent.

StarTimes group president ZinXing Ping says StarTimes has the aim of becoming "Africa's most influential digital TV operator".

"There are about 11 million households in South Africa with TV sets. About 4 million are subscribers to pay-TV. There exists a tremendous potential to develop the pay-TV base in South Africa".

StarTimes which already has over 7 million pay-TV subscribers in China already operates pay-TV services in 13 African countries with 23 000 employees and 2.3 million African pay-TV subscribers across the continent.

China's StarTimes is operational in African countries such as Nigeria (where it passed 1 million subscribers last year), Tanzania, Kenya, Rwanda, Uganda, Guinea, the Central African Republic (CAR) and Burundi and already has registered local companies in 16 African countries and is willing to inject new capital into TopTV.

A possible deal will give China and StarTimes a crucial foothold in South Africa's pay-TV market – the most advanced on the African continent which is dominated by MultiChoice's DStv service.

TopTV's 'goodwill' eroded

StarTimes says that as a digital technology provider it already owns a number of digital television invention patents and software copyrights. StarTimes has set-top box (STB) decoders which support standard definition (SD) and high definition (HD) television.

StarTimes says "the lack of scale and experience of management resulted in low quality and highly priced programmes" at TopTV.

"TopTV does not have any differentiation or competitive advantage," says StarTimes. "DStv is a very strong and powerful pay-TV operator in the South African - and even in the Pan-African - market.

"Compared with DStv, TopTV does not have an innovative business model or differentiated products and services and has no cost advantage due to its small size in the market."

StarTimes says that TopTV's "goodwill" in the market place has been eroded, but that StarTimes' "highly respected and influence and reputation" can help to restore TopTV's credibility and restore its operations.

Comments

  • John Smith - 2013-04-18 14:18

    At long last! Some decent competition to break the Multichoice stronghold on satellite television in SA. Let us hope this bailout is not blocked by regulators disguised as an attempt to keep competitors out of the market. Hit Multichoice where it hurts most --- Bring down the cost and add choice for the South African consumer. Something that is lacking within the current Multichoice offering.

  • Perter Damingo - 2013-04-18 14:26

    I cannot wait for the cost war to begin as DSTV is very expensive. This will cause the price to go down I am sure of that

  • Grant Logan - 2013-04-18 14:29

    DSTV will add a couple more channels that costs them next to nothing and just keep on increasing their prices. Look at the "new" Fox channel. Aren't they re-running series already aired on SABC?

  • Steven Korb - 2013-04-18 14:31

    they must bring out a top box that can record , forward ect like PVR

  • Peter Jordaan - 2013-04-18 14:39

    at last some competition for these scamers

  • Marcus Vermaak - 2013-04-18 14:41

    Sport.

  • Tawizee - 2013-04-18 14:43

    If they offer an extensive sports bouquet, I will join them as soon as yesterday.

  • Boom Boom Afridi - 2013-04-18 14:51

    i would still want HD programming, no hd and i will stick with dstv.

      Heinrich Spreeth - 2013-04-18 15:07

      Agreed, nut seriously , there is a MASSIVE market in SA for a cheap alternative to SABC.

  • Jean Mboule - 2013-04-18 15:12

    Top TV needs sports then they can compete

  • Shaun Cousins - 2013-04-18 15:39

    them more and more cheap chinese dubbed english 3rd grade programs makes its way onto sa screens

  • Madelein de Lange - 2013-04-18 19:34

    Had a look at the Star channel line up..... Jeez how did they manage to get 1million subscribers in Nigeria? DSTV must be shaking in their boots, NOT!

  • grant.henry1 - 2013-04-18 20:11

    Dstv are nothing but scum. Jist take a look at the fox channel that is dstv dishing people crap and taking their money. That is a slap in peoples faces. I really hope the deal works out and this Chinese company pulls toptv out of the cutters. Just so Dstv has some competition.

  • grant.henry1 - 2013-04-18 20:18

    Dstv is just like telkom they have the monopoly and they can do what they want. Why do you thing you cant buy dvd recorders anymore because dstv put a stop to it, so people are forced to buy pvr recorders to record their shows.

  • Cassandra - 2013-04-19 12:51

    The competition will be more than welcome, DStv's too long had a monopoly, a thing which ICASSA knows well and does nothing about, but competition has to do with quality, not necessarily popularity. If the quality's good, the popularity will follow.

      Tello Moea - 2013-10-28 21:12

      two thumbs up

  • Sihle Mthethwa - 2013-04-19 15:33

    If the business rescue works and they can bring in more sport channels like F1,rugby & football, I will definitely switch from DStv to TopTv.

  • Nigel Olifaunt - 2013-04-19 16:03

    Give DSTV hell!!!!!

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