Association of Cable Operators of Nigeria faults raid on licensed MMDS operators

By Sunday Oyinloye

The Association of Cable Operators of Nigeria (ACON) has faulted last Saturday’s raid on three operators of the Multipoint Microwave Distribution Systems operators in Port Harcourt by the Economic and Finance Crimes Commission (EFCC) alleging that it was   the prompting of Multichoice Nigeria, a subscription collecting firm of South Africa’s DSTV

In a statement made available to Green Savannah Diplomatic Cable by the General Secretary   of ACON, Kalada Wilson, the association said “in a commando style, EFCC simultaneously attacked the Headends of our members- CANTV, MetroTV and CTL, ordering the staff on duty to lie down; seized their phones; forcibly dismantled transmission equipment and carted them away along with the staff of the three stations, ensuring maximum damage to the MMDS operators and with competition, they can solely show the EPL matches. This has been Multichoices’ business model and strategy”.

According to the association, “MMDS operators are licenced by the National Broadcasting Commission (NBC) all over the country serving the middle class and others at the lower limits who could afford both the low entry and subscription fees to Nigerians for over Two decades ago.We have been paying licence fees to the regulator, the National Broadcasting Commission as well as Two and a half percent on turn over.

“By 2009, the Nigerian government in line with the International Telecommunications Union resolution to cede their operational frequencies for broadband, the MMDS operators operating under the association – Association of Cable Operators of Nigeria agreed with the Nigerian Broadcasting Commission and the Nigerian Communications Commission to vacate upon compensation payment to ACON members, the agreed settlement terms including cash for loss of equipment and others and to give them new set of frequencies for the relocation of their business. This was done for the common good of our country, as the frequencies were to generate huge profit to the country.

“The issue is yet to be settled by the Nigeria Communications Commission so we are still on the frequencies operating while we await settlement. EFCC’s claim that the company operations they attacked were fake operators is not true, putting it mildly, and it is calculated at calling a dog a bad name in order to hang it.

“Our Nigerian agency, the EFCC, did not bother to invite the operators on whose behalf a complaint was lodged for clarification. In our Country by our government agency, sad

The association alleged further:” Multichoice has really never believed in obeying Nigerian laws, they normally try to go through the back door to get whatever they want. Nigerian broadcast code requires that one company cannot control major sports content across all the TV platforms.

“Where acquisition rights cannot be separated across the platforms, the acquirer should sublicense to companies in other platforms.  Multichoice does not obey this. Instead they try to use their monopolistic practices to kill or frustrate all Nigerian companies out of the market. They killed off HITV, FSTV, TITV and the list goes on and on. They do not want any Nigerian company to see the light of day.

“The Nigeria law also allows any party interested to show live contents in a delayed mode. Where the parties cannot agree on the price, the court will determine the price to be paid. We have made this request to Multichoice and as usual they refused. We went to court as required by  law to determine the price to pay to them.

“While the court is deliberating on the issues, they went ahead and vandalized all the local cable companies in Port Harcourt. With the sole purpose of making sure no Nigerian company survives in this industry. They damaged and carted away FM radio and TV transmitters.

“They are used to taking laws into their own hand.  I could not say definitively if they informed the people they worked to do this that the matter is currently being adjudicated at the Federal high court in Lagos.

“When Startimes partnered with NTA to provide low cost cable tv services, they formed GoTV to go after them on the low end of the market and possibly eject them. It is interesting to note that they did not even have the license to provide cable TV services at the low end.  As usual, they used the dvb-H license which is for mobile TV to illegally jump into the market to drive Startimes out.

“It is interesting to note that while we are still mourning the fellow Nigerians killed or have their properties looted and vandalized in Xenophobic attacks in South Africa, Multichoice is in Nigeria vandalizing companies with no regards to the rule of law. If the competition is subdued, they will continue to charge Nigerians any amount they want.  TV Packages that cost 5000 Naira elsewhere, costs 16,000 Naira in Nigeria.

“After they collect all these unusual profits, they convert them to dollars and take them out to South Africa.  They drain our foreign reserve and in the process cause our Naira to go down in value. The result of this is unnecessary hardship suffered by our people. When you go to market with certain amount of money to buy things, you will be wondering if someone stole the money from you.  You cannot find what you purchased with all the money.

“They collect all these monies without paying any significant taxes to Nigeria. They achieve this using a certain method of licensing. First they have Multichoice South Africa buy the license for the whole of Africa. They turn around resell same to Multichoice Nigeria at a very exorbitant price. This ensures that Multichoice Nigeria reports only a small profit to Nigeria instead of the actual profit they are making.  As an example, if Multichoice South Africa buys CNN at the cost of 0.15 USD per subscriber month, it sells it to Multichoice Nigeria at the price of 0.3 USD per month per subscriber which represents 100% mark-up. These funds are transferred to South Africa as cost of purchase and they are not taxed.  This also allows them to circumvent the foreign exchange and profit repatriation laws and regulations.”