Digital Broadcasting Roundtable - LagosRussell Southwood, CEO, Balancing Act

http://www.balancingact-africa.com

@BalancingActAfr

Summary - DTT impact (Aug. 2013)

TV households: more than 100 Million but only 2.5 million of them receive DTT (soon more M. in Tanzania-Kenya)

100 Million African TV households need to get DTT equipt (STB, DTV, antennas)

>500 African TV channels still need to convert to digital.Between now and 2020, almost 50 national terrestrial

networks need to be set upAt least 56 DTT programme bouquets will need to be

created >need for digital content and digital channels

The new African TV landscapeNumber of Analogue TV Channels by country (2011)

43% of countries only have 1-2 analogue channels.

Top 10 Sub-Saharan Markets by TV households

Country TV Households

Nigeria 24,203,000

South Africa 11,500,000

DRC 5,000,000

Kenya 5,000,000

Mozambique 4,400,000

Ghana 2,282,992

Ethiopia 2,000,000

Cameroon 1,184,661

Cote d’Ivoire 1,000,000

Uganda 1,000,000

Source: Balancing Act estimates based on various sources

Likely shape of Future Landscape - +5-10 years More Free To Air channels even in countries currently with

only 1-2. Still major FTA players but rest fragmented. More thematic rather than time-based channels, Former will

be widely distributed. Increase in Pay TV subscribers. More competition. Triple Play. Satellite “fremium” channel bouquets Advertisers’ perspective: Have advertise on more channels

because behavior less predictable. Impact of data Bermuda Triangle.

Increasing impact of downloads as bandwidth accelerates (LTE). VOD, etc. Both paid and unpaid (iROKO & Buni TV)

Greater level of international content sales The electricity factor.

The DTT transition in Africa Key benefits

1 More channels

2 Universal access to information, variety

3 Better sound and image quality

4Free up spectrum for other services (telecoms)

5 Telecoms development

6 Reshape the communications sector

7 Enter the digital age

8 Option: more local content

9 Option: more delivery platforms

10 Option: combat piracy

11 Option: interactive services

12 Option: e-governance

13 Option: extra local jobs

DTT progress so far

Status Number of countries

No announcement of timeline (“Nowhere to be seen.”

11

Policy paper, Task Force, Committee, Training(“Slow adopters”)

17

Pilots 20

Early adopters (Mauritius) 7

Completed (Tanzania?) 1

Spectrum issues - Government strategic choices and impactLow (RW) and Very Low(LR) Occupancy

Red = High; Yellow = Medium; Green = Low

DRC and Uganda (152 MHz) – only high in capitals

Same is true for Medium countries except Ghana

Majority of African countries, analogue TV broadcasting doesn’t use up much spectrum and therefore doesn’t occupy much in the band 790-862MHz

Spectrum Issues – Govt. strategic choices and impactOverview of High, Medium and Low Occupancy

Below the headlines

Spectrum: What is likely to happen

2% of countries will incur increase in spectrum occupancy when digital broadcasting introduced (Ethiopia).

37% of countries no change (Algeria, Libya, Rwanda, Southern Sudan, Zimbabwe, Central Africa Republic, Chad, Comoros, Djibouti, Equatorial Guinea, Eritrea, Gambia, Guinea, Guinea-Bissau, Lesotho, Mali, Mauritania, Mauritius, Sao Tome and Seychelles)

61% of African countries will incur a decrease in spectrum occupancy when digital broadcasting is introduced (Angola, Benin, Botswana, Burkina Faso, Egypt, Gabon, Ghana, Kenya, Liberia, Madagascar, Mozambique, Namibia, Niger, Nigeria, Senegal, South Africa, Sudan, Swaziland, Tanzania, Togo, Tunisia, Uganda, Zambia, Burundi, Cape Verde, Congo-B, DRC, Côte d'Ivoire, Malawi, Morocco, Sierra Leone and Somalia)

Learning from others: 1. Mauritius 360,000 TV households. Only small island. One TV operator, the state-run MBC., and one signal carrier,

Mauritius Multi Carrier Ltd (MMCL). Started digital migration with in 2006. Seven years to complete

in very favorable circumstances. Will switch off this year 3 multiplexes offer 12 channels. Three key lessons:

1. Existing aerials not suitable. Poor replacement. Training for installers

2. Retail staff not familiar with DTT. High volume of queries

3. Problems synching audio and video with cheap set top boxes Touring van to check signal

Learning from others: 2. Kenya and Tanzania Convergence on policy approach: Tanzania: Multiple signal

carriers but Star Times/TBC ahead of everyone else Kenya: First KBC, then Star Times subsidiary and DStv Go TV

Artificially short deadlines: TZ – Analogue switch off by region. First off Dar es Salaam. KE – This December 2013 but likely to be delayed.

Not finished: Kenya: 430,000 set-top boxes out of 1.5 m households. Lack of awareness and boxes.

Three key lessons

1. Clarity needed over signal carrier approach. How do different platforms work together?

2. Artificial deadlines do not work. Damage to broadcast advertising in Tanzania

3. Need for a proper public awareness campaign and

4. Set-top box supply (several months to order and obtain boxes)

Learning from others: 3. Nigeria One of first to set up a multi-stakeholder Digital Task Force. It sent

its report to President. That President died and was replaced. Several years before it was adopted.

In the meantime, Star Times started JV with state broadcaster NTA. 1.5 m set top boxes before anyone else in the market. Compare to Ghana.

Nigeria now has 3 years to go from 1.5 m to 24m. Unlikely in 18 months left.

Three key lessons

1. Ensure speedy approval of policy to give certainty and level playing field. Give it priority

2. Don’t allow a single player to entrench itself in a dominant position

3. Allow a realistic timetable even if it doesn’t meet the 2015 timetable

Learning from others: 3. Uganda Postponed deadline set for December 2014. Only 50 trial set-

top boxes. 1 m needed in Greater Kampala before switch-off Trial transmission area covers Greater Kampala (4

transmitters). Type approvals from UCC “soon” Ambitious national roll-out to cover 100%. 28 transmission

sites and 48 gap feeders Funding only for part of national roll-out.

International news channels – Al Jazeera, CNN and BBC – pay to be on DTT bouquet

Three key lessons

1. Get speedy type approval

2. Problems with monopoly signal carrier and funding

3. Allow a realistic timetable even if it doesn’t meet the 2015 timetable

Policy challenges Cost of the process – Who is going to pay? Government?

Public-private? Broadcasters? External provider? Lowering barriers to entry. Getting national signal coverage

as cheaply as possible. Encouraging new channels (eg Learning Channel) How will this be achieved?

One or more signal carriers? Level playing field. Giving DTT channel licences to both

existing and new entrants. Getting wider national coverage. Link with electricity supply.

Who’s responsible? Freeing up of spectrum for mobile broadband (4G/LTE), esp

valuable for rural areas. TVWS. When will this be done by? Limited engagement between telcos and broadcasters.

Converged approach?