Digitisation: NBC Leads Drive for Better Content, More Money for Nigeria
By Alexander T Anande
The ongoing programme by the National Broadcasting Commission (NBC) under the leadership of Mr. Emeka Mba to move Nigeria’s broadcasting from analogue to digital broadcasting is a silent revolution of historical proportions which more Nigerians need to know about. It is not just a technological landmark for the country vis a vis the rest of the world but a great example of how a government institution is deploying thought leadership to realize great benefits for the country.
In addition to the clear benefits to the country, one of the best things about the NBC plan for digitization is the innovative financing plan which involves using part of proceeds from the sale of anticipated freed ‘digital dividend’ spectrum to fund the transition from analogue to digital broadcasting.
At this period of depressed revenues, this is smart thinking. The NBC estimates that Nigeria would realize a minimum of N100 billion from spectrum freed up by the analogue to digital switchover. The creative strategy is Nigeria’s best chance at breaking the digital transition jinx and putting the country on the world’s digital broadcasting map. It has saved the country from an embarrassing situation, reduced pressure on declining national revenues which have halved as a result of falling global oil prices, and given life to a project that given the financial situation would have once again failed. Even more apt is that it has freed up capital that the Buhari administration can deploy towards funding critical infrastructure like power, roads etc.
It would be recalled that since Nigeria and 118 member countries of the International Telecommunications Union (ITU) in 2006 resolved to transit from analogue to digital broadcasting, the country has missed two switchover deadlines. First deadline was January 1st 2015 and second on June 17th 2015. On both occasions, the NBC had sought and waited in vain for funds from a government sold to the idea and benefits of a digital switchover but unwilling to provide an estimated N69billion required to provide the infrastructure development, acquisition of set top boxes and publicity, as well as other critical elements of the digital switch over.
N69billion is a lot of money by any standards. It validates the established fact that terrestrial digital migrations involves considerable costs. However, these are outweighed by the significant advantages digital broadcasting delivers for all players across the entire value chain.
Although the country still has a window to make the switch come June 20 2017 and the clear sighted strategy of the NBC to fix the funding challenge gives confidence that the new deadline is realizable, the delay has several negative implications for the country.
First, it leaves the nation’s spectrum unprotected by the ITU and vulnerable to external interference. The country is basically on its own as far as international broadcasting obligations are concerned. Second, it has also negatively impacted national pride. When the resolution was made nine years ago, ITU leaders and industry stakeholders had looked onto Nigeria, being the largest and most populous country in Africa to take the natural lead. It is a shame that once again, it is smaller countries like Tanzania and Cameroun who have so far joined the digital broadcasting world and are currently redefining the TV viewing experience of their country men and women. Third, it is slowing down broadband penetration by locking down spectrum that should have been freed up for allocation to broadband service providers.
Most importantly, the delay has in addition limited the capacity of the broadcast industry to contribute to economic growth and help the Buhari administration to create the much needed jobs for the millions of unemployed youths as well as improve the earning potential of the creative industry.
According to statistics from the NBC, the federal government could generate as much as N330 billion yearly from enhanced revenue streams and additional service possibilities offered by digital broadcasting platforms. This includes the estimated N100 billion from sale of digital spectrum, N30 billion annually from digital dividends – being additional spectrum freed up as a result of the analogue to digital switch – and another N200 billion from additional advertising, content, and Nollywood income streams by checking piracy and providing an efficient platform for content distribution.
Apart from the potential revenue accruals, the NBC study also shows that about 55, 000 jobs would be added to the country on successful completion of the digital switch.
This clearly shows that beyond the fact that digital migration signals a natural global evolution in broadcasting, it’s social and economic benefits for the nation are far too important to be overlooked and it is regrettable that we are not yet on track.
For the general viewing public, the switchover will elevate the quality of analogue television to that which obtains on satellite television like DSTV. It will mean better quality TV viewing experience; wider choice of programming (more channels, data services, pay programs); Interactivity (games, user friendly interfaces); diversity of broadcast content interactive services and parental lock setting that gives parents greater control over what their children watch on television.
For regulators and government, it means spectrum efficiency gains, increased transmission capacity and as stated earlier, more revenues from spectrum sales. For instance in an equivalent frequency channel used for one analogue TV service, Digital Terrestrial Television (DTT) typically allows between 4 and 18 services to be accommodated. The increase in transmission capacity can be used to deliver additional TV channels or data services. Other benefits include improved signal quality which increases rejection of noise and interference, lower energy consumption and maintenance costs for operators.
For the Buhari, digitization presents an opportunity for him to cease the challenge as well as the moment to establish an inscrutable legacy that would be akin to Obasanjo’s liberalization of the telecoms space. That is the extent of impact the digitization project would have on the country when successfully implemented. It is an opportunity for Buhari to surpass his predecessors, succeeding where they failed by redefining in a radical way how millions of Nigerians experience TV.
It is for these reasons and the urgent need to ensure that Nigeria utilizes this opportunity that would run out in barely twenty months that the NBC’s plan and strategy requires the support of all Nigerians and critical stakeholders. The future of the broadcast industry which supports the creative industry seriously depends on it. We all agree that though the sector has witnessed good progress due to the sheer industry and determination of self-driven individuals and currently contributes only about 0.99% to the GDP, its contribution to economic growth is still a far cry from its potential. The digitization project presents a good opportunity to reverse this pattern and expand the wealth creating potential of this industry.
As the regulator and the midwife of the project, the National Broadcasting Commission under the leadership of an experienced industry player, Mr. Emeka Mba from actions taken appear focused on seeing the plan through.
In March, this year the NBC after a long and tedious process engaged the services of Inview Technologies Limited, a UK based Software Company for the provision of a national Common Set-Top-Box system. According to NBC, the agreement, will see Inview Technologies Limited in collaboration with MTS Communications Limited, a consortium of Nigerian Broadcasters, present the software for the provision of key services, such as collection of annual Digital Content Access Fee (DCAF); Conditional Access System (CAS); Electronic Programme Guide (EPG); Push Video-On-Demand on DTT; Interactive Advertising and carry out audience measurement amongst other added services.
Set-top boxes are the equivalent of the Dstv decoder that TV sets would use to convert the digital signals for viewing. Once the switchover is made, all TV users would need the set-top boxes to enable them view the digital signals and it is important that they are readily available for purchase. A survey carried out by the NBC showed that 26 million of the over 37.3 million households in Nigeria had television sets. Of the 26 million homes that have television sets, only four million have digital televisions, hence, leaving over 22 million on the analogue platform. The NBC has also projected that Nigeria would need over 30 million Set-Top Boxes in the next two years to attain the digital switchover. With a population of over 170 million population, one can only imagine the size of the market for the set-top boxes on switch over.
It is assuring to note that in order to encourage local industry tap into this huge opportunity, the NBC has already commissioned thirteen local companies that would manufacture the set-top boxes locally according to international specifications. The companies are set to commence the local manufacture of the set top boxes in April 2016. The value of this lies in the expansion of the industry, new value creation, jobs that the factories would create and the boost in the capacity of the broadcast industry to contribute to the country’s GDP.
To ensure ease of digital adoption, the NBC has also pro-actively thought through and defined a convenient set-top box acquisition framework that would encourage and accelerate take-up at minimal costs to Nigerians.
In the same vein, plans have been firmed to introduce content access fees, where viewers will have to pay a fee per annum to access a whole range of interesting digital terrestrial television content. Part of this fee is to provide the funds for Nigerian broadcasters to produce local content since high-quality local content will be central to the success of digital television in Nigeria.
Also two broadcasting licenses have been awarded to deliver digital broadcasting services. The first was awarded to NTA Star Times, a joint venture between the Nigeria Television Authority and the pay-television operator Star Times, which has been designated as the first national digital signal carrier for the country. The second license was awarded to Pinnacle Communications in July 2014.
Again, in June 2014, the pilot campaign for digital migration was launched in Jos to raise awareness of the digital migration to be followed by launches in other major Nigerian towns and cities, and then the rest of the country.
As part of the milestones leading to the switch, the Commission also plans to launch the National Digital Free to air platform called FreeTV, which will provide over 30 free-to-air channels to Nigerians on the national set top box system in Jos in the first week of November 2015. From there, it also plans to move the digital train to Kaduna and Uyo.
Last month, the NBC with the approval and support of President Buhari executed a N34billion deal on 700MHz frequency licensing with telecommunications operator, MTN Nigeria as part of the funding required to achieve the new deadline date of June 20, 2017. This is a bold, proactive and unprecedented funding move that has given the digitization drive the energy and boost that it has never had before. Well-meaning Nigerians should applaud the President Muhammadu Buhari for his strong support and approval of the NBC Team’s recommendation and the NBC team for their brilliance and creativity. While the NBC team under the leadership of Mr. Emeka Mba have done well at the level of thought and creativity, the President has through his affirmative action, taken a first step towards leaving a strong legacy that cannot be rivalled in the broadcast industry.
Anande is a policy and strategy analyst
Culled from Thisdayonline