The digital Migration fiasco
Skunks I cam across this commentary and thought it nice to share.What are your thoughts What are the Fundamentals in the Digital Migration: The current media market can be described as an Oligopoly. Those that have studied Economics will agree that dismantling any Oligopolistic system that has been entrenched for decades is not very easy. According to research agency Mill ward Brown East Africa, the top 20 companies and the government spent more than 27 billion shillings in advertising last year. With the Analogue system- the level of investment in setting up TV network was beyond any average business man or woman. Setting up the technical infrastructure to distribute the Analogue signal was very costly. In addition, due to restricted frequency space- Nairobi could not accommodate more than 18 Channels. These two factors virtually made Television Business a preserve of the Billionaires. However, with the Digital System changes all that. First, Nairobi will have the capacity of hosting more than 100 TV Channels since the high-tech system allows for that. Second, the cost of setting up a TV Station has drastically fallen. According to CCK Determination No. 1 of 2013 on Cost-Based Terrestrial Digital Broadcast Signal Distribution Tariff issued last week, Digital Signal Distributors shall charge broadcasters at Kshs. 125,990per MB for Nairobi and Ksh.93,202.75per MB for other sites in Kenya. What this means is this: Any Kenyan with as little as kshs 1 million will be able to own a TV Station, and broadcast. What is the implication? Simple: I can start a TV Station that targets specific segments of the society like Sports Enthusiasts, Healthy Living Enthusiasts, and Religious Issues- at a very low cost. With CCK ordering that the charges be per MB, I can choose to have my TV Channel Broadcast only during peak hours when my target audience is at home. As my viewership grows, I shall start getting adverts, thus generate income. Now, this explains why the Oligopoly is hitting back. Within five years- the market shall be transformed from an Oligopoly to a Perfect Competition Market. It means that much of those 27 billion shillings that goes to the top four media houses will now be distributed to SHAHIDI TV, Kamau TV Network and Wafula TV et al.
Hey Kevin, Very informative article and with these developments, its high time we think of going 'Skunk TV' for the techies and with great viewership, advertising from technology companies can be focused on Technology TV of which now SME segments can afford 20-30 minutes of products shows. We have likes of CNET Tv <http://cnettv.cnet.com/tech-shows/> This is revolutionary..!!!!!!!!!!!! On Tue, Dec 24, 2013 at 11:22 PM, Kevin Omondi <kevin.ouma@gmail.com> wrote:
Skunks
I cam across this commentary and thought it nice to share.What are your thoughts
What are the Fundamentals in the Digital Migration:
The current media market can be described as an Oligopoly. Those that have studied Economics will agree that dismantling any Oligopolistic system that has been entrenched for decades is not very easy. According to research agency Mill ward Brown East Africa, the top 20 companies and the government spent more than 27 billion shillings in advertising last year. With the Analogue system- the level of investment in setting up TV network was beyond any average business man or woman. Setting up the technical infrastructure to distribute the Analogue signal was very costly. In addition, due to restricted frequency space- Nairobi could not accommodate more than 18 Channels. These two factors virtually made Television Business a preserve of the Billionaires. However, with the Digital System changes all that. First, Nairobi will have the capacity of hosting more than 100 TV Channels since the high-tech system allows for that. Second, the cost of setting up a TV Station has drastically fallen. According to CCK Determination No. 1 of 2013 on Cost-Based Terrestrial Digital Broadcast Signal Distribution Tariff issued last week, Digital Signal Distributors shall charge broadcasters at Kshs. 125,990per MB for Nairobi and Ksh.93,202.75per MB for other sites in Kenya. What this means is this: Any Kenyan with as little as kshs 1 million will be able to own a TV Station, and broadcast. What is the implication? Simple: I can start a TV Station that targets specific segments of the society like Sports Enthusiasts, Healthy Living Enthusiasts, and Religious Issues- at a very low cost. With CCK ordering that the charges be per MB, I can choose to have my TV Channel Broadcast only during peak hours when my target audience is at home. As my viewership grows, I shall start getting adverts, thus generate income. Now, this explains why the Oligopoly is hitting back. Within five years- the market shall be transformed from an Oligopoly to a Perfect Competition Market. It means that much of those 27 billion shillings that goes to the top four media houses will now be distributed to SHAHIDI TV, Kamau TV Network and Wafula TV et al.
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participants (2)
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Josy Ngatia -
Kevin Omondi