By Chimezie Godfrey
The National Broadcasting Commission, NBC, has been urged to device means of digitalising the radio broadcast sector to reduce cost of set up for potential investors.
The Executive Chairman, ATAR Communications Nigeria Limited, and Owners of Liberty TV and Radio, Dr. Ahmed Ramalan gave the advice on Wednesday at the Roundtable Conference on Media Development and Sustainable Funding in Nigeria, organised by the Faculty of Communication, Bayero University, Kano.
Speaking on media development and broadcast licencing, Ramalan decried steep conditions that discourage average potential broadcast investors from getting broadcast licences in the country.
He pointed out that some operators are stuck after the first year of operations, because they are unable to renew their broadcast licence fees.
He therefore urged the NBC to reduce the broadcast licence fees in certain localities and states with low commercial power base.
He said,”To have an honest and realistic discourse around the theme of media development and sustainable funding in Nigeria, especially from the point of view of the broadcast media, the starting point should be licencing and the agency responsible to authorise prospective investors in the broadcast sector, in this case the National Broadcasting Commission (NBC), which guiding principle is steeped in military legacy of fear and circumspection of civil society, and steep conditions that discourage average potential broadcast investors from getting broadcast licences, while giving room to the politically connected to get approvals for licences that may never use. To further buttress my point, let’s look at the following.
“Even when you have the resources to invest in broadcast media, particularly radio, and no matter how prepared you are and your pedigree in the media sector, there’s no certainty you’ll be granted a licence within a year of your application. Some have waited for two, three years or more. Indeed, some have given up with their time and investment going to waste.
“Oftentimes, being a part of the ruling political party at the centre determines your being granted a broadcast licence. There seems to be an unwritten understanding not to ‘empower’ opposition people with media power.
“From the vantage or disadvantage point of a prospective northern investor in broadcasting, the stakes are even higher. First, you get the licence through all means fair and foul, but the sum of N15,000,000 (Fifteen Million Naira) stares you in the face as payment for licence fees, whether your state is commercially viable or not. Inclusive of all regulatory fees, the cost of set-up for a small size radio station should be in the region of N50,000,000 (Fifty Million Naira).
“Most northern operators are stuck after the first year of operations. And five years later, they are unable to renew their broadcast licence fees of N15,000,000 very likely because, depending on where they are operating from, they haven’t made that money in five years. To my mind, the cost of a five-year licence fees should not exceed N5,000,000 (Five Million Naira) over a five-year period in certain localities and states with low commercial power base.
“In spite of the bottlenecks associated with getting authorization to set up a radio station, and the associated rising cost of equipment due to the falling value of the Naira, the regulator needs to quickly device a means of digitalising the radio broadcast sector.
“This, as it happens in countries such as South Africa, Europe, USA and other developed societies, will lead to a reduction in the cost of set up by transferring the burden of transmission to other entities. This is gradually taking in the television broadcast sector.”
Speaking on Digital Switch Over (DSO) and Media Development in Nigeria, he said the country is nowhere near of 15% of where it ought to be.
He therefore stressed that government should revisit the white paper governing the DSO to reflect current situations, among other critical steps.
“The DSO is the most discussed issue in the broadcast sector in Nigeria, largely because it’s a global pact by all member countries of the International Telecommunications Union (ITU) for all signatories to exit analog transmission of signals and embrace digitisation, which frees well sought-after spectrums for other valuable uses in all countries.
“Nigeria had pledged to conform by the year 2012. As we speak, we are nowhere near of 15% of where we ought to be. It is about the slowest moving project in Nigeria.
“It is mired in different shades of controversies. It is unfortunate that a project that has the potential to revolutionise the growth of television in Nigeria, open the space for more players, reduce the cost of operations, deepen and broaden content development, and importantly, level the playing field for advertising patronage, is caught in the web of intrigues and incompetence. For the DSO to succeed, however, the following ought to happen.
“The government White Paper governing the DSO must be revisited to reflect current situations and thus resolve a major snag as to the number of National Signal Distributors that must be licenced to operate as Digital Terrestrial Television (DTT) signal distributors. As it is, whereas the White Paper stipulates TWO Carriers, but FOUR DTT operating entities are confounding the situation.
“Therefore, for the DSO to make a headway, there must be a Merger of the Four entities into Two. The Four entities are: Pinnacle, ITS, NTA-Startime, and GOTV. Back in 2003 a purposeful government was able to successfully carry out a consolidation and recapitalisation of the banking sector by causing a spate of merger and acquisition that led to the pruning of the size of the banking sector entities from near a 100 to just 25, thus achieving stability and improved services.
“It appears that Nigerian broadcast regulators, including the Federal Ministry of Information, is unwilling to tap into the financial sector in order to fund the DSO, which requires huge funding to deploy the necessary infrastructure it requires. Fact of the matter is that the two main licenced National Signal Distributors (SNC) i.e., Pinnacle and ITS, are weekly capitalised.
“They do not have the financial power to grow their brief to the full extent expected of a national coverage. Government should fund them no more as that has been at the heart of the sleaze that has characterised the DSO in the recent past. Both ITS and Pinnacle should merge or die naturally,” he stressed.
He noted that the issue of Licence Fees and Carriage Fees should be approached with the growth of the industry and the Nigerian nation in mind.
“We have submitted in different fora the following:
“That fees for national carriage should be N30,000,000
“Fees for regional carriage should be N20,000,000
” Fees for state coverage should be N5,000,000
And that Carriage fees N1,000,000 per annum while Licence fees is for a Five-Year period.
“There is in place what is called the DigiTEAM that guides the implementation of the DSO. This team is narrow in composition. The NBC needs to sprinkle it with a licenced operators reflecting all the six regions in the country,” he added.
Ramalan pointed out that on the issue of advertising revenue and media ratings, industry watchers say about the sum of N200 billion is in actual circulation as advertising spend in Nigeria, that is when private and public sectors spending are combined.
According to him, for most advertising big brands from the private sector, their media buying is determined by media ratings which is controlled from Lagos, where more than 40% brand advertising spending occurs.
“However, this is the picture:
” Advertising: Few northern entities benefit, as some don’t even understand the ‘how-to’ go about connecting with the Lagos based media buying agencies.
“Media Ratings: One media ratings agency is dominant in Nigeria, and it is operated by an entity called Media Planning Services (MPS). Subscribing to their monthly ratings and demographic data is essential to being in the loop and in line of sight of the media buying agencies. However, the cost of subscription, at N2.1 million per annum is beyond the power of most northern broadcast media operators. In most cases, after payment for the first year, subsequent payments are blank.
” Audience Measurement Panel: Recently, the Minister of Information and Culture, Alhaji Lai Mohammed, has inaugurated a 15-member Audience Measurement Committee that would put in place “a scientific audience measurement system” to Nigeria’s advertising revenue potential to about $400 million in the next three years.
” Again, the northern broadcast private players are short-changed in the composition of the committee, as there isn’t a single member on the committee with proven ownership or operatorship of a TV or radio entity in the north.
“So, chances are, in discussing our potential financial outlook via a scientific ratings process, our heads are being shaved in our absence. We have written to point out this anomaly to no avail,” he said.
Also, on media funding and sustainability, he decried the fact that the Nigerian financial sector is not open to lending support via loans to the media sector.
“Early on I realised that the Nigerian financial sector is not open to lending support via loans to the media sector. The banks mostly classify media businesses as huge risk areas. This is particularly so in the beginning of your journey. However, the following are noteworthy.
“No bank will give you funds to set up a media business.
“Even development banks such as the Bank of Industry are not designed to assist media entities at set-up or in the course of operations.
“Know that you cannot do without Lagos media buying agencies if you must aim at steady and reasonable income flow.
“Subscribe and sustain MPS’ data and be in the loop.
“Be aggressive with local marketing.
“Set up a proper marketing team, train and retrain adequately, and have a research unit that will mine data.
“Have a powerful digital presence. Integrate your outputs by aligning with online media offerings.
” International funding is available. Grow your ability to access,” he said.
On the COVID 19 support, Ramalan noted that there was a massive opportunity by the Federal Government to uplift the media as was done to other sectors of the economy, unfortunately, when it came down to setting up the committee, it was headed by a Lagos based comedian, wherein the media was pooled with the creative sector, mostly Lagos based.
He lamented that the media, which operates facilities that runs at times on 24-hour diesel via generators, and with each entity employing an average of 50 persons, was asked to play second fiddle to individuals who run single and occasional acts.
He expressed delight that despite the fact that it is hard to set up a TV or Radio station, more and more entities are springing up.
According to him, there are now more than 400 licenced radio and Tv stations in Nigeria and still counting, adding that it in the last his company ATAR Communications Nigeria Ltd has equally grown from one radio station to additional three stations.
“In the last 10 years, my company, ATAR Communications Nigeria Limited, has grown from owning one radio station in Kaduna, to having three more: a 100% Hausa radio station in Kaduna called Tashar ‘Yanci, another Liberty Radio in Abuja, and Kano; as well as our path defining Liberty Television which is on Startime, GOTV, FreeTV and Free-to-Air and TSTV.
“Recently we also started in Kano, a wholly entertainment TV channel on Startimes Kano, called Nishadi Zalla, and it is making waves. Additionally, we have three daily online publications called Voice of Liberty and Muryar ‘Yanci with substantial following.
“Also, in the course of this journey, I have joined hands with other private broadcast media owners in the north to found the Northern Broadcast Media Owners Association (NBMOA) which we registered in 2014 foster synergy amongst northern operators in content development, technical capacity improvements, regional and national development, and entrench good working relationship with industry regulators.
“Again, Freedom Radio, Kano hosted the first meeting of the NBMOA, with Alhaji Faruk Dalhatu, then Managing Director of Freedom radio, as the first Chairman of the Executive Council of the NBMOA. Once again, thank you, Kano!
“Finally, I wish to state categorically that while it is hard to set up a TV or Radio station, financially speaking, and sustain same given other contending factors such as low electricity, taxes, and so on, I am still delighted that more and more entities are springing up.
“Today, there are more than 400 licenced radio and Tv stations in Nigeria and still counting, and each has designed its survival model. At the level of the NBMOA alone, our number is nearing 60 and we’re still counting,” he pointed out.
