Lies, damn lies and statistics: 15 big facts about the digital migration war in Africa

The process has been full of rancour, but up to $45b in gains over the next five years are on the table. Mauritius, as usual, is ahead of the pack.

KENYA’s long-delayed shift to digital terrestrial television (DTT) has been nothing short of tempestuous, as the industry regulator digs in and miffed media owners employ their platforms in a propaganda war, leaving many people hot under the collar.

The result of the very public stalemate has been a majority of Kenyans confronted by blank screens, a feud now in its second week.

The five-state East African Community, of which the country is a member, had set itself a December 2012 deadline to shift to digital broadcasting, but only Tanzania, not exactly a hotbed of tech savviness, and Rwanda, have so far taken the plunge, leaving Kenya red-faced.

The Kenyan attempt to shift from analogue has since followed the same Tanzanian script—media owners up in arms over the dent to advertising revenue, claims of human rights violations, a strongman regulator, peacemaker calls for simultaneous broadcasts, and even a sprinkling of Chinese flavour.

The International Telecommunications Union, the UN agency that allocates radio spectrum and satellite orbits,  set a global June 17, 2015 cut-off date to cease analogue transmissions, to coincide with the expiry of  Millennium Development Goal’s (MDGs). 

Only Mauritius has closed out the shift in Africa, almost ten years ahead of everyone else, while 19 others have launched the process,  according to Balancing Act Africa, a consultancy and research house.

But the benefits to be had from the shift are clear, from more efficient use of spectrum, a better viewer experience, savings on broadcasting costs, an explosion in ICT and content creation services, and a huge digital dividend. 

The numbers tell a money-filled story, and we look at some of them:

—It is projected that globally there were more than 1 billion digital TV households across 138 countries by the end of last year, according to UK survey firm Digital TV Research. This was a near-doubling from the 590 million homes counted in 2010, with cable TV the most dominant. Africa and the Middle East are projected to have had 132.4 million TV households at the end of 2014. But 46% of homes will still not have  a TV set.

—Sub-Saharan Africa struggles to register on the radar; the region is by 2018 forecast to have only 33.8 million DTT households (both pay and free-to-air-FTA), but itself still a steep rise from 4.6 million in 2012, and 5 million in 2014. This translates to 57.1% penetration, a strong increase from only 19.2% in 2010.

—There are however 100 million TV households in Africa in total, according to Balancing Act, meaning 95% remain on analogue. This presents the main battleground for both pay-TV and FTA digital operators.

—The costs involved in the shift are big, according to the consultancy. They include massive investment in digital networks and transmitters and in training. Essentially, at least 600 African TV channels, all in various states of readiness, across 56 African territories, will need to make the jump. 

—To understand the rancour further, follow the money: the battle over the digital shift has been over advertising. Digital TV Research projects that global television advertising will reach $236 billion in 2020, a 38% rise from 2013.  A third of this will still be on FTA. 

—By the end of 2014, there were some 12.92 million pay TV subscribers, with three-fourths of these being on satellite television, and the rest on pay DTT. These numbers are by 2020 projected to double to 27.95 million subscribers with 13.1 million, double the number from 2010, coming from sub-Saharan Africa.

—Of these 5.1 million would be South African, but the country has been anything but a migration champion, its process held up by obstacles such as issues over the subsidised purchase of Set Top Boxes (or STBs, which convert the digital signal to one that can be understood by an analogue television set, which is the predominant type in Africa).

—Sub-Saharan Africa pay TV revenues are projected to reach a staggering $6.2 billion in 2020, from $3.54 billion in 2014 and just $1.92 billion in 2010, according to Digital TV Research, from a profile of 35 SSA countries. South Africa accounts for a third of these revenues, while Nigeria will in 2020 account for $1.15 billion of the revenue. 

— Three companies; Multichoice (DStv and GOtv), Canal Plus and Star Times accounted for more than 90% of pay TV subscribers by the end of last year in Africa. The latter has been particularly in focus, having run into pockets of opposition from many countries, the chief reason being that it is Chinese and bringing with it the suspicion that it will bring Beijing-style censorship to the continent.

—However, at least 30 major platform launches are set for 2015—twice as many as in 2014. Interestingly, FTA satellite TV is expected to have become the most popular platform in Sub-Saharan Africa , overtaking analog terrestrial television, which is steadily tanking, Digital TV Research says. 

—There is a question of capacity in some countries. The survey firm says that while Kenya’s digital market has shown considerable growth, “it may be overheating”. Kenya currently boasts two pay DTT platforms, a cable network and four satellite TV operators; “too many for a country with only 2.87 million TV households?” The FTA operators are just about to muscle in on the party, further pushing down Average Revenue Per User (ARPU), making content the real referee.

— On a more advanced front, worldwide the number of households watching online TV and video (OTT) will reach 706.5 million in 2020, from 197 million in 2010 and 374.43 in 2014. Only 5.8 million of these were in the Middle East and Africa, a number that dramatically falls in sub-Saharan Africa. It is expected that by 2020 nearly half of the world’s TV households will view online television and video, from 15.4% in 2010.

— A solid digital migration process loosely follows this bite-sized chunks order: surveys, central coordination bodies to manage chronology, the setting up of institutions to among other functions provide policy frameworks, regulate the process and distribute signals, pilots and the launch of huge public awareness campaigns. The alternative is now-or-never leaps into huge national problems.

—The Global System for Telecommunications Association (GSMA) has attempted to quantify the gains to be had, and says a successful migration on the continent would yield $45 billion by 2020. This translates to a third of the value in loans, foreign investment and development aid to the continent.

—The digital dividend also translates into 500,000 jobs, and at least 200,000 new businesses, not to mention the gains in relocating spectrum freed up with big gains for mobile telephony and states running in the billions of dollars, from key areas such as taxation and the auction of licences.

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