Broadcasters to benefit if CA okays price cut in signal distribution

December 9, 2015
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According to CA, the advisor took into account market developments; it also provided a comparative analysis of the current situation in line with international best practices/FILE
According to CA, the advisor took into account market developments; it also provided a comparative analysis of the current situation in line with international best practices/FILE
NAIROBI, Kenya, Dec 9 – Broadcasters in the country are set to benefit from a decision by Communications Authority of Kenya to review prices charged by Broadcast Signal Distributors (BSD).

In a bid to host more broadcasters, CA’s proposed measures will lower prices by as much as 30 percent from the current prices.

In a study commissioned by the authority earlier this year, CA proposed that content producers in Nairobi be charged a maximum of Sh88,000 per megabit per month, down from a current rate of Sh128,000 and that those in other major towns pay Sh39,000.

To get the findings, the authority commissioned Analysis Mason, a media, telecoms and technology advisor, to review the current broadcast signal cost model in the country.

According to CA, the advisor took into account market developments; it also provided a comparative analysis of the current situation in line with international best practices.

“Analysis Mason used available institutional, regulatory and financial information, and through a costing exercise, proposed a costs and prices of signal distribution to be charged by BSDs,” says the authority.

If it is adopted, CA has stated that the review will be undertaken periodically and is expected to enhance a conducive and enabling environment that supports growth and vibrancy of the industry.

According to analysts from Standard Investment Bank, the downward review on price will also mean greater pressure on large broadcasters who will have to launch much more specialist channels in order to compete effectively for niche market segments.

A Similar move by the authority includes that of 2013 when a cost-study it had done led to a downward review of tariffs for digital signal distribution. This was done in a bid to facilitate smooth transition from analogue to digital broadcasting.

Approval of the price review is however awaiting further internal consultation by the authority before being approved.

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