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New Broadcast Code: Assault on the market and democracy

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By ‘Kanmi Ademiluyi

With the focus on survival due to the coronavirus pandemic, out comes a not-so-cleverly-disguised assault on the operations of an economy based on the efficacy of the market, but also a potential limitation on the plurality which anchors a democracy.

As democrats and with the backdrop of the observation of the first celebration of the defining date of June 12 as Democracy Day, it is unsafe to allow the existential threat of COVID-19 to make us complacent about opaque threats to the country’s hard-won democracy, which is still a work in progress. The threat to innovation, the consolidation of intellectual property rights as well as the operations of a market-propelled economic system by the 6th National Broadcasting Commission (NBC) Code should not be allowed to distort the country’s political economy.

The ethos of the code released to the public by the NBC on May 27 is in direct contradistinction to the thrust of the President Muhammadu Buhari administration to build a society that ensures those who produce and create sustainable jobs are given the pride of place, as opposed to the ethos which fetes those who deal in favours. The latter is what the celebrated Afrobeat exponent, Fela Anikulpao-Kuti, decades ago, famously branded “Paddy, Paddy arrangements”.

The cronyism-fired arrangements described by Fela not only failed to deliver economic growth, but crucially stifled innovation and made the country uncompetitive with disastrous results. The country is still paying the price for cronyism and incestuous market-distorting economic relationships till date.

Although in its opening gambit, the 6th NBC Code peddles a sanctimonious sermon: “To maintain and promote efficient market and conduct effective competition in the broadcast industry in Nigeria…”, looked at closely, it is anything but pro-competition. For the evolution of modern market-oriented economies in democracies is underpinned by a robust defence of intellectual property rights as a propelling trajectory in innovation and content development. This has been the source of the continued success of places like Hollywood, Bollywood and other media markets.

ALSO READ: NBC Code: Netflix, Amazon, iROKOtv, Africa Magic may end investment in Nigeria

Dangerously, swathes of provisions in the code prohibit exclusivity, ominously compel content sub- licensing to competitors and empowers the NBC to determine sub-licensing fees in the event of a dispute. These provisions will certainly inhibit investments in Nigeria’s potentially rich and relatively untapped local content production sector. What is intended through the backdoor in the absence of open hearings in full public glare and with the inputs of all stakeholders is a brutal assault on intellectual property rights, the prospects of content development as well as diversity, which are vital ingredients in a market economy.

These stifling provisions are straight out of the Command Economy playbook. This is odd. Command economies exhausted the limits of their possibilities and imploded decades ago. No wonder the promoters are in mortal terror of open public hearings, which will clearly expose the shenanigans and the real anti-competitive intent underneath the sanctimonious sermons. As stated by major stakeholders, the Code was finalised without input from them.

All of this is bizarre in an industry oiled by creativity in which whole financial instruments have been developed, whereby trading in intellectual property rights is taking place very much as a commodity. Eroding proprietary rights by making exclusivity illegal and compelling [this is as draconian as is imaginable] sub-licensing of content and regulating price (remember the debacle of previous corruption-fuelled attempts at “price controls”?) will clearly stifle private enterprise with the sort of interference, which begins by distorting markets and eventually kills them off.

The contempt of the framework accepted internationally in intellectual property safeguards and commercial proprietary rights is mind-boggling.

The purported objective of the related provision is an enthronement of fair market competition, especially for new market entrants. It compels rights owners to live foreign sporting events, for example, to offer such to broadcasters on different platforms at an agreed fee and in the event of a dispute, the NBC will determine what is to be paid. The Code also prohibits the bundling of Nigeria “in the same basket with other countries in the sale of football rights.”

Acquisition of sports broadcasting rights is a commercially-competitive process, with the prerogative of how to sell and to whom exclusively that of the rights owners.

The Code’s sub-licensing  proposal does not take cognizance of the fact a licensee, which has acquired the rights  after paying competitive a rate, suffers an inability to differentiate its service from that of competitors— to whom it’s forced to sell at a regulated maximum price—and an erosion of the value of the rights because it cannot use them exclusively.

The Code similarly ignores the fact that granting of sub-licensing rights is not guaranteed, leaving a licensee with the burden of having to negotiate for sub-licensing rights for which the owner— knowing a re-sale is in the offing— will demand a substantially heftier sum.

It is not just broadcasters of live foreign sports content that will be affected by the bid to institute a command economy process. It is also a doomsday scenario for general entertainment platforms such as Filmhouse Cinema, Africa Magic, Netflix, Irokotv and prospective entrants. With this framework, no investor in his/her right mind will waste money and energy developing content to then donate to those who deal in favours. If implemented, the code will bring an end to pay TV in Nigeria. The multiplier effect will manifest in job losses and leaner tax revenues.

Out of obscurity over three or so decades, a vibrant creative industry has developed in Nigeria, a tribute to the country’s commercial attributes and can-do attitude. The industry has shown that economic diversification can be translated into more than shibboleths and vacuous sloganeering. The industry has shown the way and made us all proud. Any readjusting of a winning model must, at least, be preceded by multi-stakeholder consultations and public hearings. The latter, vitally, will see the consumers making input and helping to build a consensus for the benefit of all. This will prevent the rent-seekers who have continued to swing a wrecking ball at the economy, seeing the creative industry as just another gravy train to hop on. It will be tragic if that happens.

Ademiluyi, an economist and journalist, wrote from Oshogbo.

Vanguard

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