by Thinus Ferreira
The South African public broadcaster has lost over R600 million in advertising revenue – its biggest loss in revenue collection so far – as SABC ratings fall across its TV channels which have forced the broadcaster to lower advertising rates.
While struggling to lift ratings for its linear broadcast channels of SABC1, SABC2 and SABC3, the broadcaster is planning to launch its SABC+ video streaming service before the end of this year, hoping that it will lure new viewers, will bring viewers back and will help to stem the churn of viewers fleeing the public broadcaster’s TV content.
In a presentation before parliament’s portfolio committee on communications, the SABC’s top executive said that the struggling broadcaster has lost over R600 million in revenue over the past two years – its biggest loss in revenue collection – due to a significant decline in audiences across its platforms.
The SABC is steadily losing viewers because of a combination of factors.
These range from a lack of new content and compelling local content, a lack of content that resonates with viewers, ongoing schedule disruption, an increase in the number of global video streaming services available locally luring viewers away from traditional television, and the Covid-pandemic that depressed ad spending.
An increase in the number of middle-class TV households switching to lower-tiered pay-TV packages, together with stiff competition from eMedia’s free-to-air commercial broadcaster e.tv that is rapidly overtaking the SABC with ongoing, structured content-spend on hugely popular local series, are also big factors denting the public broadcaster’s TV ratings month to month.
Then there is the South African government’s ongoing switch-off of Sentech’s analogue transmitters, cutting off viewers’ access from the SABC who haven’t migrated to digital terrestrial television (DTT) yet and which has led to further SABC TV rating declines over the past few months.
The SABC is facing a massive uphill battle, especially in prime time.
Where its programming used to rule the TV roost years ago with a majority share of viewers during prime time, the SABC’s aim now is to try and get a prime time TV ratings share of the overall available audience of 25% for SABC1, and 8% for SABC2 during the 2022/2023 financial year.
For the severely ratings damaged SABC3, the SABC hopes to only pull 3% of the entire available TV audience during prime time, during its current financial year.
Madoda Mxakwe, SABC CEO, told parliament regarding revenue loss that “the big one for us is the audience decline particularly in classic revenue and its cost us close to over R600 million because there’s always a correlation between positive ARs (audience ratings) as well as revenue growth”.
He said “in the past two quarters we have been able to procure over 163 new programmes and these are going to help us to ensure that we increase our audience ratings and that also from a point of growth in revenue that will help.”
SABC chairperson Bongumusa Makhathini again told parliament that MultiChoice as a pay-TV operator should help with the collection of the new TV tax called a “household levy” from DStv subscribers which the SABC wants to be introduced to replace the broken and outdated SABC TV Licence collection system in South Africa.
“We operate in a very competitive environment. Some we compete with, don’t have the constraints that we have and they get to the best product before we can be in a position to close those deals,” he said.
“As the executives continue to look for compelling and quality content we will be able to breach that gap and have the content that is compelling that can inspire confidence from the advertisers and from our audiences and really get the SABC numbers to stabilise and to grow.”
The SABC said its target is to launch its SABC+ over-the-top (OTT) digital video streaming service during the current 2022/2023 financial year.