FG moves to end anti-competitive tendencies in business practice

Olusegun Aganga, Minister of Industry, Trade and Investment
Federal Government plan to formulate a policy to checkmate
monopoly, anti-competitive behaviour especially among business practices has
been considered by Nigerians as cheery news.

In its draft
copy of the National Competitive and Consumer Protection Policy, the Federal
Government saddled the Competitive and Consumer Protection Authority, an
independent body, with the responsibility for the implementation of the
provisions of the proposed competition and consumer protection legislation. Speaking
at the occasion, Olusegun Aganga, Minister of Industry, Trade and Investment
said the new policy will help address cartel-like organisations,
anti-competitive tendencies, protect the investing public and consumers, and
enable consumers to buy the goods and services they want at the best possible
prices. “Nigeria”, the minister said, ‘is one of the very few countries that
did not have a robust legal and regulatory framework to govern consumer protection
and competition.”

Kehinde Yusuf, 53, is one of the many Nigerians who
have hailed the move. He cited practices of a Pay TV operator as one which
needs urgent attention in that area. “I’m a DStv subscriber, and I have
severally complained about being cut off two, sometimes three days before
expiration of my subscription date”, Yusuf said. “But whenever I make this
complaint nothing is done, so if Government wants to introduce that policy I
think it would do well to address some of these issues”.    
Obinna Nwokennaya is a multiple subscriber. Nwokennaya
subscribes to both DStv and Star Times. And in his reaction on the Pay TVs service
delivery, he said “where a customer fails to pay subscription fee on or before
due date, it takes DStv hours, if not days, to come back to transmission, but
for Star Times, it is immediate, even after two weeks off air”.
Following the liberalization of broadcasting in the
Nigerian market in 1992, Multichoice, a South Africa based company and owners
of DStv and GOtv since
2006,
has dominated the industry, and engaged in monopolistic practices especially on
the exclusive acquisition of the broadcast rights to premium programs.
And sport is known
as one of the key drivers of Pay TV subscriptions around the world. In this
regard, Multichoice, a South Africa based company and owners of DStv and GOtv
has dominated the scene. Multichoice airing of the English Premier League, EPL
rights exclusive to DStv, while refusing the rights to other competitors,
increased its market share in Nigeria.
Nigeria’s
Cable television market, according to statistics, is put at 2 million, out of
29.5 million TV households. The statistics states that, ‘the current total
active market is less than 3.1 million subscribers across all players in the Pay
TV market in a population of over 160 million inhabitants, 65 percent of whom
are under the age of 25, and low penetration of households.’  
Put more
succinctly, Naspers, owners of Multichoice stated to have added a record 1.3
million Pay TV subscribers year-on-year for period ending March 31, 2014. While
presenting its annual results in June 2014, the Pay TV operator said its Pay TV
service under DStv and GOtv brands subscriber base now stands at more than 8
million – roughly 5 million of those in South Africa and the remaining 3
million in Sub Saharan Africa. The report also stated that GOtv, which offers
DTT pay television services in 11 countries on the African continent, ended
March with 817,000 customers, up from 377,000 a year earlier.
Multichoice’s
sports content is one of its dominant factors. “Multichoice essentially decides
how African, and indeed Nigerians consume sports media,” said a communication
expert who craves anonymity. “They control the times of broadcasting, what
sports are shown and how the viewers will even view the event, because they
have the control. And the absence of anti-competitive laws contributes to the
dominance”.
Sport has not
failed to escape the scrutiny of competition authorities. In the Western world,
through regulatory bodies, competition is promoted, and interests of consumers
are guarded in relation communication matters. In the United Kingdom, Office of
Communications (OFCOM), an independent regulator and competition authority responsibility
covers content and infrastructure in the country’s communication sector. Under
the Communications Act, 2003, its statutory duties are ‘to further the
interests of citizens in relation to communication matters, and to further the
interests of consumers in relevant markets, where appropriate, by promoting
competition’.
In the UK
where the sale of the EPL broadcast rights is regulated to avoid exploitative
activities by a single broadcaster, it would be recalled that in March 2010
OFCOM imposed a ‘wholesale must-offer’ obligation, under which Sky, one of the
country’s foremost Direct to Home Cable Television Service Provider, was
compelled to make its two main sports channels (Sky Sports 1 and 2) available
to other Pay TV retailers at regulated prices. Not only did OFCOM require the
pay broadcaster to whole the two channels to other operators, but also fixed prices.
Even in Asia
same is obtainable. Telecom Regulatory Authourity of India (TRAI), India’s regulatory
body, also prohibits monopoly and anti-competitive behaviour. TRAI is primarily
involved with issues of carriage and pricing. The Central Government in
pursuance of its Cable Television Network (Regulation Amendment) Bill made it
obligatory for every cable operator to transmit or retransmit the programme or
channels of any other pay channel, thus eliminating the need of multiple set
top boxes by any subscriber.
Coasting
home, Nigeria’s National Broadcasting Commission (NBC) should play the regulatory
role here. But the power to wield the big stick, and to who, is absent in its Act.
“Ordinarily,” said a credible source in NBC “we should play a significant role
here as a regulator. But in the NBC Act and Code as amended, its major
regulatory approaches contained in the Code are licensing, sanctioning,
arbitrating, and monitoring. It lacks the inclusion of sector specific
provisions empowering it with the authority to investigate, regulate, control
and prosecute anti-competitive behaviour”. No doubt this has called for need of
the commission to review its Code: “in areas of market definition, vertical
integration and downstream foreclosure, access to and exclusivity over premium
content, which is potential for anti-competitive behaviour,” the NBC source added.
Onyekachi
Ubani, immediate past Chairman, Nigerian Bar Association (NBA) Lagos Chapter does
not think the Pay TV has been fair to Nigerians despite the fact that the Pay
TV has exported the country’s entertainment industry outside the shores of the
land. “They are cheating Nollywood actors with little or nothing they pay in
using their works, yet they defraud Nigerians with astronomical fees for
subscription”, the human rights lawyer said. A Nollywood source, who craved
anonymity didn’t mince words, “Multichoice buys a movie from us for N20,000,
and they keep playing it years on end without giving us anything again”.
Festus
Keyamo, human rights lawyer and DStv subscriber shares self experience. “They
are exploitative in their service delivery”, said Keyamo, who told our
correspondent that he is a subscriber in three major cities of the country.
“That is why I continue to say they should adopt card technology, whereby I can
remove my card when I’m not watching and use in another city, like paying for
what I watch”. 
But the
feasibility of that is not in sight. John Ugbe, Managing Director, Multichoice
Nigeria Limited in a recent interview in commemoration of Multichoice’s 20
years celebration in the Nigerian market said, “You have to look at the
industry. Not all industries can use card technology”, he said, giving an
analogy. “It is like going into a restaurant and you say look, let me just
starting eating. If I have to leave, whatever I eat is what I pay. It is in
order to serve you, that they create the menu that you can buy a plate of food
at certain amount. Content, unfortunately, is not paid for in minutes”.
Despite its
bouquet of channels, Multichoice was forced to cut down its price with its
introduction of GOtv. Entrant of Star Times, a Chinese owned pay DTT rivaled Multichoice
as a major challenger in Nigeria.  
Star Times General
Manager, Justin Zhang, in December 2013 stated that since it launched in July
2010, the company has recorded over 1.5 million customers. This statistics significantly
proved the potential of low-cost Pay TV.

It is this
desire for robust competitiveness that created a sigh of relief for consumers in
the telecommunication sector. It would be recalled in years past that MTN
charges per call was outrageous, until the introduction of Globacom, an
indigenous telecommunication company came into the market and introduced per
second billing before we understood the possibility of talking cheap. And it is
expected that with the recent introduction of the Federal Government policy this
will address and encourage competition in the domestic market as well as
maximize consumer welfare
.

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