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Goodies for switching to digital broadcasting

FINANCIAL STANDARD
By | December 15th 2009

By Macharia Kamau

The broadcasting industry is set for a radical transformation upon migration to digital broadcasting platform, which started in earnest last week.

The migration to digital broadcasting will affect all players in the industry — from free to air channels to pay TV operators and also video rental stores.

The new environment is also expected to spur growth in the sub-sector, especially for companies engaging in production of local programming due to the expected increase of broadcasters.

Kenya Broadcasting Corporation (KBC) Managing Director David Waweru said investors setting broadcasting firms would find it easy as they would no longer need to invest heavily in deploying and maintaining infrastructure, but focus on content development.

Acquisition and deployment of equipment such as transmitters has been among heavy costs that investors have had to bear and also prevented current broadcasters from covering the entire country.

"For new broadcasters, it will be the cheapest and most convenient mode of broadcasting. Just set up a studio, generate enough content to fill 24 hours and send that signal to the KBC Digital Platform for transmission," he said.

"For existing broadcasters, this will give them an opportunity to transmit TV signals to all parts of the country, and in clearer sound and picture quality."

National broadcaster

The national broadcaster — KBC — will play the role of maintaining the digital television signal distribution platform as well as broadcasting digital signals for other broadcasters, through its recently established entity Signet. The arrangement is expected to lower costs incurred broadcasters in infrastructure maintenance.

Mr Alex Gakuru, chairman ICT Consumers Association of Kenya, said the new era would usher in new business models for the industry.

"Anybody can be a broadcaster if they can get enough programming to run on their channels," he said.

Communication Commission of Kenya (CCK) Chairman Phillip Okundi said the industry is now poised for growth, with capacity to generate many jobs and revenue for the operators.

"The sub-sector will soon realise and surpass growth that have been witnessed in the mobile telephony sector," said Mr Okundi.

Broadcasting on the digital platform is expected to free up frequencies and subsequently see more broadcasters start operations.

According to Okundi, digital transmission is efficient in its use of frequency spectrum than the analogue system. Frequencies are a scarce resource and unavailability has locked out many investors from the broadcasting.

Industry regulator

The industry regulator has more than 60 applications for television and 150 for radio, but could not issue licences due to lack of analogue frequencies.

On the digital platform, however, one channel has eight frequencies.

Currently, there are 18 commercial free to air television stations, more than 60 FM radio stations and 17 pay TV providers.

More players in the segment is expected to spur content development.

Information and Communication PS Bitange Ndemo said though there has been an increase in local content, the situation is still wanting and broadcasting firms should now focus on content development or find themselves on the wrong side of law.

The recently enacted Kenya Communications Amendment Act requires all broadcasters to air at least 40 per cent local content beginning next year, a regulation that opens up a huge business potential for homegrown production houses.

"Local content is going to be a ‘super headache’ for stations but it is upon them to move towards this direction," he said

Other segments that might be affected by shift are the pay TV companies and video rental stores.

"The digital platform has features like video on demand and video rental stores must reengineer their operations to remain relevant," said Ndemo.

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