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Pay-TV: Ending row over ‘pay-per-view’ model

For the umpteenth time, Nigerians recently took to the social media to demand pay-per-view or pay-as-you-go model as the case may be, from their pay-TV operators. While several experts have attested to the fact that the demand may have been misplaced as it is unrealisable, the perennial agitation is fuelled by incessant price increment, which the operators must address. SAMSON AKINTARO reports

Irked by a recent announcement of an upward price adjustment, subscribers to Multichoice’s DStv and GOtv vehemently condemned the pay-TV operator for what they described as its annual ritual of price increment. Although the recent subscription fee increment was to reflect the 2.5 per cent increase in Value Added Tax (VAT), the subscribers were again reminded of their earlier agitation for pay-per-view. With effect from June 1 this year, Premium subscribers of DStv, who had been paying N15, 800, are now paying N16, 200; Compact Plus subscribers are paying N10, 925 instead of N10, 650. Those on Compact now pay N6, 975 as against the previous N6, 800. Furthermore, customers on Confam bouquet pay N4, 615 against N4, 500, while those on Yanga are now made to pay N2, 565, against the N2, 500 previous payment.

Multichoice had explained that the increment was in line with the Federal Government’s new tax law which increased VAT in January 2020 with implementation effective February 1, 2020. The pay-TV operator said it had absorbed the cost increase for four months before it decided to pass it to the customers.

Subscribers kick

But for the DStv customers, it was one increment too many. They would rather the company consider making their service pay-per-view in Nigeria. According to them, paying the high monthly subscription in a country where power is unstable or in situations where they only watch for a few hours at night is a waste of money, hence, they would want an arrangement where they only pay for what they watch. Some of the subscribers, who took to Twitter to express their dissatisfaction with the pay-TV operator, said DStv’s current pricing system “can best be described as extortion”.

They, therefore, called for the government’s intervention in compelling Multichoice to start pay-per-view. One of the subscribers identified as Zenaida Machado said she could try to understand that “bad weather” could affect DSTV’s service. However, what she did not quite understand was why she must pay for a service she did not enjoy. So, she wanted DSTV to consider the possibility of refunding her money whenever “bad weather” prevents her from utilising her subscription to the fullest.

Legislative intervention

Meanwhile, the lower chamber of the National Assembly, House of Representatives, has waded into the tussle between Multichoice and its Nigerians customers. The House, which has begun an investigation of cable and satellite television service providers in Nigeria over their high tariffs and monopolised bouquets, said it would soon summon Multichoice to answer questions over the much-talked-about pay-per-view. Chairman, House Committee on Broadcasting, Unyime Idem, at a recent investigative hearing in Abuja, said that the National Broadcasting Commission (NBC) had been sum-moned to explain why DStv and other service providers refused to introduce pay-per-view.

Idem said: “Today, we want to hear from you and your team, how the industry can be properly managed so that beneficiaries who are Nigerians can smile at the end of the day. I am sure you must have been hearing of the yearnings of Nigerians for years now, who are the subscribers to these services that they are not happy with the current services they are getting from the providers. “They have been crying on a daily basis that they are not satisfied with the services they are getting from the providers in terms of high charges, price hike and, most importantly, considering what is obtainable in other countries of the world that is pay-per-view offer that other countries are giving to their subscribers.

“Why is it not implemented in Nigeria? We want to know your position as the regulator of these service providers. What are the bottlenecks? What are the constraints? What are the implications? Why are we not enjoying ‘pay as you go’ as subscribers to these service providers?”

Multichoice reacts

Reacting to the latest demand, MultiChoice’s spokesperson, Caroline Oghuma, said there had been some misconceptions about what pay per view means. According to her, pay-per-view is not a service that enabled one to match consumption to subscription as was the case with a meter or mobile phone.

She said: “It is a type of pay television service by which a subscriber of a television service provider can purchase events to view via private broadcast. It usually applies to a one-off broadcast of high stakes games such as football, boxing, and even wrestling matches.

“Pay per View service can be purchased via a cable or satellite TV provider as a non-refundable separate package in addition to a pre-existing subscription. An example of pay per view in action was the Mayweather vs. McGregor fight, aptly dubbed ‘The Money Fight.’

“In this case, subscribers had to each pay up to $100 for the bout in the US, and watch or not, the subscription ended with the 10 round fight. “We broadcast the same boxing match to our Premium subscribers at no extra cost, and those who have Exploras were able to record the match and re-watch at another time. It is important to state that it is an expensive service to subscribe to. To date, no pay-TV operation globally has a model based solely on a pay as you view, as it is not a viable business model.”

In response to the same demand in January 2019, the company had said point blank that it would not operate the pay as you view tariff system in Nigeria, despite demands for such. The Chief Customer Officer of Multichoice, Martin Mabutho, who made the statement in a media interview, had said: “We are not going to introduce pay as you view system. Our contract with our suppliers is on a month to month basis.” “The issue of not introducing pay as you view remains. Nothing will change it; the channels do not belong to Multichoice. What we do is to slash our prices in half to make our customers enjoy our services,’’ he said.

Pay-per-view reality

While the pay-TV operator had explained why pay-per-view is not feasible under the circumstances it is being demanded, one of Nigeria’s experts in consumer affairs has given insights into the reality of the demand being made by the Nigerians consumers. According to the Chief Executive Officer of the Federal Competition and Consumer Protection Commission (FCCPC), Babatunde Irukera, the pay-as-yougo billing model in telecommunications is not necessarily applicable to pay television.

Responding to a question on the subject during a recent TV programme, Mr. Irukera said many pay television subscribers confuse the operations of telecommunications with those of the pay-television industry. He explained that what obtains in telecoms is not necessarily applicable in pay television, as broadcast content must have been paid for and customers only pay for access unlike in telecommunications where the subscriber only pays when the timer starts.

“My challenge with what sometimes is the discussion around payas- you-go in pay-TV is that there is a disconnection and we’ve been through this. We have conducted some investigations and we have done some surveys in different parts of the world. The pay-as-yougo model in telecommunications is not necessarily applicable and so we confuse it sometimes with pay-perview,” he said. Giving clarifications on pay-perview, Irukera said “Pay-per-view is not that you pay for what you view from the point of when you turn your television on.

It is primarily that there are certain programmes, maybe a boxing match, a soccer match or some movies that are still in the cinemas that some of the pay-TV operators have bought and you can literally request instead of going to a stadium or going to a cinema to watch, you can watch it in your home and pay for that view. “What people are asking for in pay-as-you-go is when you turn on your television and you are watching, you pay. When you turn off your television and you are not watching, you don’t pay. It is difficult because the content has been created, what you are paying for is access. How you use the access is entirely discretionary and up to you. Unlike the telephone where the clock starts and the airtime goes down, you have paid for content,” he said.

Last line

Nigeria, no doubt, needs a competitive pay-TV industry to end this agitation for pay-per-view, which in the real sense of it is not realisable. The monopolistic tendencies of the current dominant operator and a few other fringe players will continue to drive up subscription prices if the market remains as it is.

 

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