By Prince Osuagwu (Hi-Tech Editor) & Emmanuel Elebeke
It appears a stiff competition is going to happen in the Digital Satellite Television, DSTV space in a few months, as a new cable satellite television operator, TSTV comes to town.
The only time this kind of brewing competition happened in that space was between 2007 and 2011 when Entertainment Highway, owners of the defunct High Television, HiTV, had a brief stint in the industry, giving Multichoice a run for its money.
HiTV, on August 1, 2007 launched its multi-channel digital satellite television service in Nigeria using Hypercable Digital Terrestrial technology and launched Direct to Home (DTH) Satellite technology.
It later broadcast its material only on satellite at the price of N3, 500 monthly. It was the first television platform in Africa to deploy Hypercable, a terrestrial pay-per-view TV decoder system.
However, the satellite television operator’s services eventually crashed in November 2011 due to financial difficulties.
Prior to the coming of HiTV, Multichoice enjoyed maximum monopoly, having exclusive right to show the English Premier League games in Nigeria. Due to the huge followership of that football league in Nigeria, it appears to be the major attraction for cable operators and those who don’t have the right, scramble for crumbs, which amounts to nothing, anyway.
HiTv instantly became a force to reckon with when it surprisingly grabbed the rights to the 2008/2009 Premier League season. By the end of that season, it has become the leader, having 80 percent of Premier League coverage in Nigeria, while MultiChoice owns rights to the other 20 percent.
It however, was not able to pay up or provide bank guarantee when it won the rights again the next season and lurking behind, in case of any eventuality, Multichoice, immediately seized the opportunity to pay up as the second preferred bidder.
So, taking back the right in 2010, Multichoice has continued the monopoly which cumulatively has lasted for more than two decades.
But, just like in 2007 when HiTV crept in, Multichoice’s hold on the market once again, appears threatened with the coming of TSTV.
Telcoms Satellite TV, better known as TSTV launched October 1, 2017, with a promise to serve Nigerians a bouquet of services with some form of flexibility and affordability that no other PayTV operator has given.
Besides, the operator has also lined up array of powerful contents and channels like sports, entertainment, news and others which it promises to deliver on pay-per view model, in order to bring a new dimension to the competition
Although the operator did not reveal how it is going to do it, it promised to show the EPL games, which right is currently exclusive to Multichoice.
TSTV, is said to have a lot of factors to favour its survival in the industry. One of it is that it is owned by ABS, known to be led by a management team of talented and experienced professionals, and offers a complete range of End-to-End solutions including Direct to Home (DTH), Cable TV distribution (CATV), Cellular Backhaul, VSAT and Internet Backbone services with diverse IP transit through its European, Middle East and Asian internet gateways.
Another is that it has secured government support. After launch in Abuja, the Minister of Information and Culture, Alhaji Lai Mohammed, announced that TSTV will enjoy a pioneer status with a three-year tax relief, adding that it will help the company quickly redefine the market. He also expressed conviction that the new PayTV platform, will crash the price of PayTV in the country.
He said: “You have come at a very good time because this government only recently granted a pioneer status to the Creative Industry and what this means is that you will be entitled to a three-year tax relief and all your investors will not pay any tax dividends,” he added.
He revealed that the Creative Industry played a critical role, along with other non-oil sector players, in pulling Nigeria’s economy out of recession, and that the government plans to develop the industry to contribute 5 percent to the GDP by 2020, as against its current
contribution of 1.36 percent.
He commended the pay TV for conviction and belief in Nigeria and pledged the readiness of the Federal Government to continue to create conducive environment for private sector investments to thrive.
The company now seems to have the right mix of technology and support to survive in the Nigerian market but it must also know how to use them to avoid the pitfalls that ruined the brighter chances HiTV had.
Apparently trying to provide a better insight to what culminated to the demise of HiTV and perhaps also sound a sort of warning to those who would play in the Nigerian business environment, former Managing Director, Chief Executive of HiTV, Mr Toyin Subair, on his LinkedIn page, wrote:
Why HiTV failed
“HiTV collapsed essentially because of a clause in our original Shareholders Agreement, which allowed a group of founding shareholders to block the company raising money or selling off a subsidiary. This right was exercised to block our capital raise because it was believed to be a possible ploy by another group to take control of the company. We the management were caught in the middle and it took us another eight months to pursue the alternative that was acceptable to the shareholders but by that time the equity market had gone bust, leaving us grovelling all over for debt.
You need Government, regulation on your side
I ignored government to my peril. The competition spent a lot of time courting all arms of government and I was a simpleton. We just expected the whole world to cheer us on. The laws in Nigeria are as empty as they are full. A lot of writings but you have to make sure your business model is adequately protected.
What laws you need, or what interpretations of the laws you require, go and get it passed or adjudicated; don’t assume it’s there and don’t be afraid of offending anyone. A few weeks before we lost the EPL rights we were approached by the competition to share it with them, in writing. We agreed and were completing the approvals on both sides when we lost the rights.
Since they bought it, we asked them for it on the same terms as we had agreed to give it to them just two weeks prior, they refused. We ran to government to enforce the fairness clauses of the NBC Act but it fell on deaf ears.
We really should have actively pursued the enactment of anti- monopoly laws and competition rules early enough as exist everywhere else in the world. The truth is we never believed in monopoly and offered all our acquired TV rights to anyone who was ready to share the price with us. Our purchase of football rights was defensive, as that was the only way we could get it. Unfortunately, our government was happy to, as they continue to be, leave everything in the hands of foreign dominant players”.