October 22, 2017

Zambia needs to revisit its digital migration partnership with Star Times

KAMPALA, MAY 27 – On paper, a recent announcement by the Zambian government that they had entered a joint venture partnership with Star Times in a bid to fast track the country’s digital migration appears to be a sound decision.

On one side you have a right minded government with a limited resource envelope but with an urgent need to get a major public project completed, while on the other you have a large corporate company with sector specific expertise and the deep pockets needed to finance the same. There is a saying “the devil is in the detail” however in this case the detail appears to be the devil.

In September 2013, Zambia’s government cancelled a digital terrestrial TV tender awarded in 2011 to China-backed Star Times Group subsidiary Star Software Technology, due to “irregularities” in the tender process. The multimillion dollar deal was meant to cover the design, supply and commissioning of the country’s national DTT network.

Somehow in a complete turnaround less than five year after the controversial deal was terminated, Star Times has managed to sign an even better deal that will effectively give them control of the national broadcaster ZNBC along with monopolistic control of the country’s entire digital television landscape going forward.

Whilst it’s true Zambia like most African countries is forced to source capital externally even for basic national projects, the government still has an obligation to be accountable to its citizens and protect their interests by operating in an open and transparent manner. This includes explaining the underlying reasons for committing the country to a partnership with a foreign company which has clearly broken Zambian laws in the past.

The fact that government is handing control of its national broadcaster to a foreign company is not only detrimental to the sovereignty of the Zambian nation, it is highly likely to have a negative impact on the economy as a result of possible tax exemptions, access to free ZNBC land and take away jobs from local Zambians under the guise they don’t yet have the skills to manage such a large and highly technical business.

Over and above this, under the terms of the deal, Star Times appears to be determined to exclude all other players from the market, as they insist on having exclusive control of the sale, distribution and marketing of all DTT products countrywide, effectively killing off any potential growth in the television and film sector which normally thrives during the digital migration with new players entering the market in a bid to tap into the sales, distribution and marketing opportunities.

The unfortunate reality however, is that none of what Star is trying to do in Zambia is news to the continent. Ever since it launched operations across Africa the company has been plagued by controversy. In the DRC Star had its operating license revoked over frequency infringements, in Ghana they are currently engaged in litigation with the government over a cancelled DTT contract while in Malawi a similar Zambia style back door monopoly operator deal between Star and the government is fast starting to unravel.

So as they concretize the partnership the Zambian government needs to ask itself whether it is worth risking further delay of the country’s digital migration, already a year behind the rest of the continent or look at alternative solutions that might fast track the process. The answer to this question might seem fairly complex but it’s not, Zambia should simply borrow from the experiences of its fellow African countries who have successfully managed their migrations by restricting themselves to the creation of an enabling environment and regulatory framework then leaving the market to do the rest.

In Uganda for example the Government decided against partnering with any Pay television service provider focusing instead on developing its own DTT infrastructure for the general public though SIGNET the national signal distributer. This ensured that public Free to Air interests would be catered for without distorting a vibrant and growing pay television market which employs thousands of Ugandans.

The Zambian Government should therefore revisit its partnership with Star Times because it appears perfectly set up for the creation of an unhealthy monopolistic market environment which if left unchecked could one day be seen as a treacherous conspiracy against its own people.

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