On Digital Media commits to skills transfer

8 Jun 2007

At the Independent Communications Authority of South Africa's (ICASA) hearing earlier this week into the granting of of Pay-TV licences, On Digital Media (ODM) said it intended to introduce and use new and existing skills and technology in South Africa to deliver a cost-effective African broadcasting solution that will provide affordable choice to the SA population and accommodate its cultural diversity.

OMD stated that it has the technology and technical know-how to deliver an innovative and affordable digital satellite Pay-TV offering to many South Africans.

“There is a massive opportunity to bring quality digital satellite Pay-TV content to those South African households previously excluded from accessing Pay-TV or simply not attracted by the historical offer,” said Grant Edmundson, ODM's representative at the ICASA hearings.

BEE shareholding

ODM is a South African-owned company with 54% effective black economic empowerment (BEE) shareholding and includes broad based BEE beneficiaries.

In addition to a strong black woman's group, comprising some of SA's leading black business women, major BEE organisations such as Kagiso Media and Lereko Investments have aligned themselves with ODM. Kopano Ke Matla Investment Company, the investment arm of Cosatu, has provided the BBBEE shareholding in association with the Industrial Development Corporation (IDC). As one of the founders, First National Media Invest Holdings (FNMIH) remains part of the shareholding structure.

SES, a global satellite group, will own the rest (20%) of the ODM equity capital and will provide ODM with the latest digital broadcast distribution over the entire sub-Saharan Africa.

Modern Times Group (MTG), an international television broadcaster with interests in Pay-TV, Free TV, radio and TV production, will support ODM with access to international content.

“ODM shows the right mix of local, international, financial and industrial partners for the successful launch of a truly new and accessible Pay-TV for South Africa,” ODM told the hearing panel.

Emphasis on skills transfer

The company also committed itself to a special emphasis on skills transfer through the participation of its international partners in support of the Government's ASGISA program.

ODM said “We will draw on extensive global digital satellite Pay-TV expertise to offer a truly new and highly flexible and customisable digital satellite Pay-TV offer which will empower viewers, who currently do not subscribe to any Pay-TV offering, with real choice from around 40 quality local and international channels, while paying only for the services they choose to view”.

“This concept of multiple and affordable choice is entirely new in South Africa,” ODM emphasized.

The service will be delivered direct to households (DTH) via an encrypted digital signal through a satellite dish and a digital decoder.

State-of-the-art satellite and distribution technology (MPEG-4 compared to currently used MPEG-2 compression technology) is at the heart of ODM's strategy, enabling it to use broadcast capacity more efficiently and to introduce High Definition Television (HDTV) when the market demand arises.

In addition, ODM has secured over R400 million equity funding to commence operations from its shareholders and R785 million in debt finance from a range of institutions. Edmundson is confident that “ODM has managed to secure sufficient amount of equity capital from a well balanced group of investors in order to successfully launch its Pay-TV service”.

“Should ODM be awarded a license, the real winners will be the SA population as ODM will bring them an affordable entry into quality Pay-TV with real choice,” Edmundson concluded.