The South African Broadcasting Corporation (SABC) is reportedly taking broadcasting signal distributor Sentech to the Competition Tribunal over allegations of excessive prices and anti-competitive behaviour.
This emerged recently after a debate in parliament, where Doris Tshepe, head of the Competition Commission, told MPs that a commission-led effort to mediate between the parties had failed.
Addressing Sentech’s unfair, unregulated tariffs was one of several SABC priorities directed at legacy regulations.
Communications minister Mondli Gungubele told the same committee meeting that the public broadcaster pays Sentech US$ 1 million/month but that its debt to the state-owned signal distributor is huge and is beginning to have repercussions for the company’s financial stability.
But the SABC shows no sign of backing down, turning to the Competition Tribunal for relief.
Last year, it emerged in parliament that the SABC owed Sentech more than US$37 million, and Deputy Communications Minister Philly Mapulane told MPs at the time that the SABC was not only technically insolvent but owed Sentech about half of its annual revenue.
In its earlier complaint to the Competition Commission, the SABC strongly criticised Sentech’s tariffs and behaviour, describing the fees as “inappropriate or correct”. It said its concerns led to creating a “chart of accounts project” at the public broadcaster to determine the fairness or otherwise of Sentech’s fees.
“The details of the various costs per service and per transmission site have been requested from Sentech to understand how the cost structure for each service was derived. Sentech has not been cooperative in this regard for the past two years,” the public broadcaster alleged.
“The SABC is of the view that Sentech’s conduct contravenes the Electronic Communications Act, which provides that in determining its tariffs, Sentech must duly take into account the nature and technical parameters of the service provided to each broadcasting licensee to ensure that the different tariffs are appropriate and commensurate with the various broadcasting services to which they relate.”
The commission said several factors needed to be considered, including Sentech’s price-cost margin, internal rate of return on capital invested and profit history.
An assessment conducted by the commission in the form of price-cost tests focused on the financial period from 2017 to 2021 found that Sentech’s prices for radio terrestrial transmission increased by percentages of between 3.37% and 5.37%/year.
