Free-to-air broadcasters want a bigger slice of the ad pie as pay-TV cashes in

  • The SABC wants a cap on advertising revenue from subscription channels.
  • The public broadcaster says SABC TV and Radio’s advertising revenue is down.
  • Communications regulator Icasa said it would continue to observe and monitor revenue trends.

Pay-TV takes the lion’s share of broadcast advertising revenue and free-to-air operators want the system overhauled to ensure they are sustainable and what they believe is a fair share of revenue from airtime sales.

This is contained in the draft conclusions document of the Review of the Independent Broadcasting Authority Regulations 1999which covers advertising, infomercials and program sponsorship.

Broadcasting companies such as eMedia Investments, Media Monitoring Africa, MultiChoice, the National Association of Broadcasters, the South African Screen Federation and the South African Broadcasting Corporation (SABC) submitted written comments to the discussion paper on the Review of the Independent Broadcasting Authority Regulations 1999.

Concerns about the current ad revenue landscape dominated submissions made by several companies, with differing opinions on how the level playing field should be leveled.

eMedia, which owns free-to-air e.tv and 24-hour news channel eNCA, said in its submissions that the ad revenue share for itself was 21.71%, while SABC had 28. .78%. MultiChoice enjoyed the largest share at 39.02% and the remaining 10.49% was shared by other broadcasters.

eMedia believes there should be an investigation to determine whether the current share of advertising revenue by subscription services is appropriate and to determine the impact of online advertising on the long-term television advertising market. and in the short term.

READ | The impact of the Netflix era: SABC wants to limit ad revenue for private streaming

The company urged the authority to “protect the sustainability and viability of free services.”

“eMedia states that with the shrinking advertising pie available to broadcasters, to ensure the continued viability of free-to-air broadcasters, limitations must be placed on the amount of advertising time available to subscription broadcasters,” the company proposed.

He further raised concerns that MultiChoice’s monopoly position would worsen the impact on the financial viability of free-to-air broadcasters and that subscription broadcasters had no limits to their licenses on the length of advertising. .

The Independent Communications Authority of South Africa (Icasa) said in the draft findings that it accepts there are market forces such as audience fragmentation and competition with on-demand services. unregulated that negatively impact broadcasting revenue trends.

He said he would continue to observe and monitor these trends.

Public broadcaster SABC – which has implored the regulator to ask Parliament to amend the Electronic Communications Act to cap advertising and sponsorship revenue earned by pay-TV broadcasters – said its revenues for the period from April 2016 to March 2020 had declined significantly and that SABC’s television and radio advertising revenue was down.

In its submission to Icasa, the company had proposed a parliamentary amendment to the regulator to “prescribe regulations that place an effective revenue cap on subscription broadcasters’ advertising and sponsorship revenue”.

Icasa said the matter was outside the scope of the investigation.

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