In the closing months of 2017, one sensation which dominated the airwaves in Nigeria was excitement about a homegrown initiative — TStv. It was the perfect answer in a country reeling in economic shocks and a population that was steadily losing its purchasing power. A massive throng of vibrant youths, an extensive appetite for entertainment and a general willingness to get it at far less… the stage was completely set.
Three years on, however, Telecom Satellite Television (TStv) has folded into a whispering ghost in Nigeria’s broadcast sector. Its infrequent appearances and a tally of unfulfilled promises leave much to be desired from the widely supported outlet. But even as it struggles to maintain a foothold, it is pertinent to examine popular misconceptions which Nigerians have about the Pay TV industry. From the purchase of broadcast rights to technical nuances of the service, this article explains the structure of the industry, with a view to point out the pitfalls in Tstv’s model.
From Owner to the Living Room
Pay TV is a broadcast phenomenon which provides users with more television services than they would normally get. As the name implies, they have to pay for it. An understanding which is pretty much relegated, however, is the fact that the business has three important levels across its value chain. The first is the owner, the opening cadre who holds the rights to the content. On the second, there are satellite television operators who are willing to buy. And the third, is the subscriber or end-user who enjoys it.
The relationship of the operators, like Startimes and DStv, with content providers is largely determined by consumer demands. Often, subscribers require channels which supply top-of-the-line content such as European football leagues, movies, global news, and other major events. As the absence of these channels on an operator’s menu will cause it to lose its charm, providers of the content are placed in a stronger negotiating position. Owners charge exorbitant fees before their channels can be broadcast and increase them according to whim when the old contract expires. To keep meeting the demands of the subscriber base, the satellite TV operator continually adapts to service costs and prevailing economic challenges by making periodic upward reviews of subscription fees.
And through the Sky It Goes
Satellite TV operators rely on a transmission method known as Direct-to-Home (DTH). What this means is that needed data, audio or video, is transmitted right from the providing station into the viewer’s residence. This process requires the use of an uplink facility, a satellite, a satellite dish, before it can be achieved. The uplink facility is the hub where the broadcast procedure starts. Here, antennas which relay signals to a satellite are operated. An antenna receives a signal which it transmits in turn to a satellite positioned to receive it. When it does, the satellite follows a process known as downlink, where it transfers the data back to earth, but this time, to the subscriber’s satellite dish. The dish then passes it on in form of relevant content to the setup box within your living space.
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One thing that must be noted though is that what matters is neither the seemingly triangular nature of the whole thing, nor the simplicity of what may have appeared complex, but the cost which the service demands. African Pay TV companies are not known for running their own satellites, rather, they pair up with European companies to deliver content. An immediate instance here is the partnership between TStv and ABS Global in 2017 to provide channel access using the latter’s satellite. Here again, we find the Pay TV operator on a march of his own. Satellites are no small project to bankroll and partnerships of this nature take their pound of flesh in terms of maintenance costs and other service charges. This enormous expenses which the TV operator accrues therefore make it difficult for old players like Startimes and DStv to implement the model proposed by their indigenous rival.
Pay Per View, Pay As You Go, and the Prepaid Controversy
There are many different acronyms which have been circulated in both social and official parlance, all of them invariably say one thing: subscription charges should be dependent on how much you watch. Under the Pay-Per-View model, the commonly held misconception is that it is similar to Pay-As-You-Watch, which it is not. PPV is simply a special access granted to view specific satellite content. A highly anticipated football match, a boxing bout, any hugely demanded product can fall under this segment. Because it is exclusive, viewers are required to pay a certain amount to access it from their homes. This payment does not form a part of their main subscription. Once the content is done with, payment for it is equally exhausted.
PAYG on the other hand, is a term which is more suited to the telecommunications industry. Mobile phone billings (which are done per second) occur based on the amount used without a time-bound exhaustion of a package. Phone calls are apt in this regard.
The prepaid model which is operated by Multichoice and its Startimes is routinely contested in government circles. Subscribers pay a specific sum for a particular bouquet and exhaust it, whether or not they enjoyed it to the maximum, once the time given expires. A major complaint against this is the absence of a user during an active subscription and the consistent cuts in electricity. The vacuum created by this made room for TStv’s entry. The subscription can be paused when the user is not viewing it and payments are also made based on the channels consumed. This leverage, while magnetic, is also inconsiderate of the facets of running the business.
MultiChoice and Startimes are obliged to pay their providers regardless of how much the subscriber has used the content. The charges do not reflect the satellite Tv’s pricing model and they certainly do not care for the blackout tendencies of its market. One would therefore ask if TStv is planning to run a charity, now that it is back again, and if it has an amazing stash of funds to back it up. Whatever plan the company has in the offing, it is hoped that it blossoms into something strong.