Cost of doing business hindering pay TV penetration
Jun 08, 2014
Pay television operators are concerned that the costs of Set Top Boxes (decoders) are hindering broadcasting service penetration especially within the poor communities.
By Vision Reporter
Pay television operators are concerned that the costs of Set Top Boxes (decoders) are hindering broadcasting service penetration especially within the poor communities.
Players now pay 6% withholding tax and the 18% Value Added Tax, which they still consider as deterrent for more people to join, this is compounded by the cost of technology like paying for satellite space and buying local and international content.
According to Simon Arineitwe, the country general manager for Azam Tv, a new entrant onto the pay television local market, STBs need to be as cheap as possible because they serve as cardinal steppingstones for the public to start enjoying the digital dividend currently offered by private operators.
“Public either deserves subsidies or more tax cuts on STBs to enable more people owning television sets get on board so that they are not left out as the country transits from analogue to digital broadcasting, commonly referred to as digital migration,” he said.
Arineitwe was speaking to the media on the sidelines of a training workshop his company organised at Hotel Africana to equip the company installers with the required installation technical knowledge and modern customer care systems.
The Information Communication Technology state minister Nyombi Thembo explained recently that Government is committed to boosting pay tv penetration and interventions are being undertaken to realise that; for example the 25% import duty waiver finance minister Maria Kiwanuka instituted on STBs.
“Through more lobbying, government could consider relaxing other costs that cut across the broadcasting technology, even television set prices need to go down because the current stiff competition is precipitated by the existence of increasing number of the pay television service providers going for a handful of the population owning TV sets,” he said.
Competition stiff ahead of digital migration
The satellite powered Azam Tv, joins a an already crowded market comprising players competing to attract more subscribers towards pay television services. Six million Ugandans own TV sets with only 15% on pay television services.
With the dish technology, the company joins the likes of Dstv, GOtv, Zuku, StarTimes currently serving a combined subscriber base of at least 90,000 customers.
Players argue that reducing the costs of doing business will reduce user costs and boost pay television penetration.
The local charges for initial connection with dishes are between sh200,000 and 120,000 while the Digital Terrestrial Transmission (antenna powered) service providers charge between sh70,000 and sh65,000
The Uganda Communications Commission Executive Director Eng. Godfrey Mutabaazi said that his body was working around the clock to ensure that it switches off all analogue television sets before end of next year to realise full digital migration.
He advises public to either join the current pay television service or buy free-to-air decoders currently being sold locally.
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