StarTimes deal may force media houses to consolidate – Sam George

Sam George, Member of the Communications Committee of Parliament

Member of the Communications Committee of Parliament, Sam George, has warned Ghanaian media houses may be forced into mergers if government continues to grant digital terrestrial television (DTT) licenses to foreign companies.

“If we are not careful, in the next two to three years, what we are seeing in the banking sector, we may also experience the same thing with the consolidation of media houses,” he cautioned.

The Member of Parliament (MP) for Ningo-Prampram speaking with Goldstreet Business at a public forum on Ghana’s digital migration project in Accra said ‘’if the DTT platform is expanded to accommodate 100 channels, it could lead to a fierce scramble for revenues, eventually forcing various media networks to merge if they are to survive.’’

Questioning the rationale behind the expansion, Sam George added, some media networks like, TV3, TV Africa and EIB Network have already laid off some of their staff.

Comparing markets

Comparing Ghana’s digital market to other foreign markets, Sam George said South Africa with a population of 59 million has a market worth of US$1.2 billion but has only 17 Free-To-Air (FTA) channels.

The United Kingdom (U.K) with a population of 70 million people and a media market worth US$17 billion, has only 17 FTA channels.

But Ghana’s market which is about 1 percent of the UK market, has 48 FTA channels for less than 30 million people whereas Ghana’s market is only worth US$196 million.

Government through the Communications Ministry, is said to have agreed to expand Ghana’s DTT infrastructure from 40 to 100 channels.

Sam George also expressed concern about the US$3 million tax waiver announced by Minister for Communications, Ursuala Owusu-Ekuful to Star Times, when nothing was offered to K-Net, a Ghanaian-owned company which executed the DTT platform contract.

Background

Government first signed a US$95 million deal with Chinese company, StarTimes to supply and install the DTT network platform for Ghana in 2012.

But the contract with StarTimes was later abrogated over the failure of the company to secure the necessary funding from the China Exim Bank to execute the project.

Government then awarded the digital migration contract to K-Net. As K-Net worked on the project, StarTimes sued the government of Ghana claiming an unfair abrogation of their contract with Ghana.

The Ghana Independent Broadcasters Association (GIBA) have raised concerns over the involvement of StarTimes in the project which has been built by local firm, K-Net.

According to GIBA, StarTimes has already set up a pay-TV in Ghana, therefore, allowing them to handle the entire DTT infrastructure would threaten Ghana’s security and sovereignty.

By Mawuli Y. Ahorlumegah