P.M. reveals change of plan over proposed Govt. TV channel
Prime Minister, Tuilaepa Dr. Sa'ilele Malielegaoi, has revealed that the Government could pull the plug on plans for a state-owned TV channel.
The channel was to have been set up to utilise the recently launched Digital TV platform. But due to the costs of joining the project, Prime Minister Tuilaepa has revealed a change of heart.
He said the Government should not endure the burden of paying the extra costs incurred to connect to the digital platform.
Such costs should be shouldered by the TV stations while the government pays for whichever broadcaster they utilise, said Tuilaepa.
“The question that arises is it’s expensive to connect and the owner [of the Digital TV] should be well aware that if the TV stations do not use it then, they won’t get any returns – it will go broke,” the Prime Minister said.
Tuilaepa also clarified that the Digital TV is not owned by the Government.
“I have explained to those that are suffering with high blood pressure (over the Digital TV costs) claiming that the government is taking sides [on the issue] that there have been instructions not to proceed with that [a government channel],” he said.
“Whatever TV station the government uses [for its programmes] the government will pay for it."
Tuilaepa also spoke about a letter he wrote to the Regulator’s Office in relation to the issue of Digital TV and the complaints from the broadcasters.
Dated 4 November 2019, the Prime Minister told the Regulator that he had asked them to discuss the issue with those involved and report back to him before a decision is made.
“But for you to issue a press statement where you attempt to interpret my thoughts shows that you think you know everything,” he said.
“It is good to be wise but it is not good when you think you know everything. Listen and obey.”
Tuilaepa said the letter was to remind the Regulator that of a Samoan saying: E fa'alogo muli mai ia mua mai. It translates that "whoever comes last should listen to the person who was there first."
In response to queries from the Samoa Observer, the C.E.O. of the Ministry of Communications and Information Technology, Fualau Talatalaga Matafeo said the government has been allocated one channel of the eight channels supplied for Digital T.V.
Fualau was asked about the recent comments from the Prime Minister to discontinue plans for the government channel.
“We are going through a transition period and as you would understand, there are huge costs associated with developments of such magnitude,” replied Fualau.
“And with such developments in particular this transition from analog to digital, it is being implemented in phases/stages not only due to the magnitude of the work involved but the need to ensure 100% coverage to the whole country.”
The C.E.O. said with all the work currently underway during transition period and recent issues raised by local T.V. companies to the proposed tariffs the Ministry will seek the official decision from the Prime Minister and Cabinet.
The government owned T.V. channel was proposed to air government developments, awareness programmes and parliament sessions.
Last week, the Regulator’s Office wrote to all the General Managers of local T.V. stations to notify them of the consequences they will face if they are in non-compliance to the Regulator’s Order.
The order instructs the TV stations that “all licensed Broadcasting Service Providers (T.V.) are required to connect to the Digital Platform no later than Friday 15th November 2019.”
On Monday afternoon, the local Broadcasters issued a joint statement on the matter. It is printed as follows, verbatim:
JOINT PRESS RELEASE BY ALL TELEVISION BROADCASTING OPERATORS
IN SAMOA ON DIGITAL TARIFF
Despite intervention by the Prime Minister and the specific instructions he has given to the Regulator for a reconsideration of the tariff, the Regulator has continued to issue letters of warning threatening us, the existing TV broadcasters of having our licenses revoked if the tariff she has set is not accepted by 15th November, 2019.
While we are waiting for a Government decision on our request, we received another order from the Regulator dated 6th November, 2019 which she says has been filed with the Courts therefore has become a Court order. The Regulator’s order states that the tariff to be paid by each TV station to SDCL, a company owned by Faamausili Andrew Ah Liki is set at $35,795. per month.
In the same letter, she wrote that the tariff rate has been reduced to $23,473. a month effective as of 1st November, 2019. But the new tariff will be valid for 6 months only. The initial tariff she has set of $35,795. a month will be restored after six months. We find it ridiculous. Ua taunuu ai le upu a le atunuu, ‘e faapili le namu, ae folo le kamela.’
At the rate of $23,473 a month SDCL will collect $164,311 a month from the 7 existing TV stations, almost $2 million tala a year, or $39.4 million in 20 years of their license. SDCL is getting an incredible deal at the expense of TV Operators and not to mention the public.
We had sought help from the Prime Minister for a reconsideration of the rate as none of the existing TV stations can afford it. We were hoping that the Regulator, SDCL and we, as potential customers of the digital platform can come to a compromise and work out a rate that would mutually beneficial. But while we are negotiating and waiting for decisions, the Regulator continues to flaunt her power issuing threats of closure of our businesses.
We sincerely hope the Regulator accepts $15,000. per month as proposed and kindly endorsed by the Prime Minister. It would be a stretch on the business budgets but it is something doable. SDCL still gets a fair return while the TV stations can survive. At $15,000. a month SDCL will collect $1.2 million a year or $25.2 million in their term of contract. It is a reasonable return for their capital cost of $6. million tala. A figure that all 7 existing TV broadcasters can only dream of in a lifetime, given the relatively small size of Samoa’s advertising market.
The Regulator plans to switch off the analogue system we are currently using on 31st January, 2020. It means all transmitting sites throughout the country that TV stations had spent a lot of money on, will have to be pulled down. It would be a huge loss to existing TV stations.
The Regulator should also be mindful that TV stations now have to import microwave links to carry the TV signal from our studios to SDCL. These links cost USD$28,000. or approximately $200,000. with air freight, handling & customs duties factored in. A cost saving for some of the TV stations, if the Regulator had not prohibited the use of fibre optic that costs only $800. per month.
The fact is, the Regulator has totally ignored the interests and concerns of the TV industry, focussing entirely on protecting the benefits and interests of SDCL. Here are some glaring examples.
At a meeting with all TV Operators, the owner of SDCL said they have spent $6 million on the project. The Regulator suddenly interrupted and said the cost is $10 million not $6. million. It didn’t sit well with us. Why does it appear that the Regulator seems to know more about the costs of the project than the owner himself?
SDCL owner tried to calm everyone by adding that they are reasonable people and would be open for individual negotiations. The Regulator again jumped in, ‘whatever amount you agree on, I must endorse it’. All heads turned to her with bewilderment, she looked at us and added, ‘because I have the last saying’. It eventually dawned on us that someone is drunk with power.
SDCL suggested that it might be a good idea if TV Operators consider investing as shareholders in the business. It sounded logical and attractive. But the Regulator in her authoritative demeanour jumped in again and said, ‘no no no, you cannot do that, it’s against the law’. The look of shock registered on everyone’s faces. The unspoken question was obvious, ‘is there something we don’t know?’
As private broadcasters, we have never had a mandate nor the authority to lead any change especially a Government driven change of this magnitude. Therefore, it is totally unfair for the Regulator to lay the blame on private TV Operators for not stepping up to initiate and coordinate the digital switch.
As business people we knew at a glance without having to hire economists and experts as suggested by the Regulator, that this project would not be viable. For a small island nation with an equally small advertising market, we knew that no TV station in Samoa can afford to pay such a ridiculous amount of $35,759. a month or more than $429,000. a year!
Hence we dropped negotiations with a financier and suggested to the Regulator that may be the Government should take ownership and fund the project. The Government would not be restricted to recovering capital costs in a short period of time as commercial enterprises do. The government can also extend the term of license for as long as they want. At the same time the Government has in place another guaranteed source of revenue that will benefit the whole country.
Sadly, as private businesses we can only suggest.
Unfortunately, the consequences of this mess will not only cripple the television industry but will also impact negatively on the social, economic and political development of Samoa.
One person’s bad decisions, can cost us our businesses when we are forced to close down, not to mention the loss of hundreds of employment, and the Government of course losing earnings from taxes and utilities.
Again, all TV Operators are pleading for a fair deal in the transition to Digital.