CA slashes broadcast fees by up to 60 percent

November 9, 2016
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CA Director General Francis Wangusi said the cost-modelling would ensure that the tariffs arrived at give Signal Distributors a reasonable return on their investment
CA Director General Francis Wangusi said the cost-modelling would ensure that the tariffs arrived at give Signal Distributors a reasonable return on their investment./ FILE

, NAIROBI, Kenya, Nov 9 – Communication Authority of Kenya (CA) has reviewed downward its monthly signal distribution fees following a study undertaken by analysts Mason, a UK consultancy firm.

The study recommends that Broadcast Signal Distributors (BSD) charges must not exceed a certain recommended price cap.

The new rates will see broadcasters pay Sh89, 545 per megabit per month for signal distribution within Nairobi and its environs down from the current Sh125, 990 translating into a 29 per cent reduction.

The cost of distributing digital signals in other major towns will come down by 60 per cent to Sh37, 311 from the previous Sh93, 202.

The television broadcasters will now pay 32,961 monthly fees for signal distribution within remote areas.

CA Director General Francis Wangusi said the cost-modelling would ensure that the tariffs arrived at give Signal Distributors a reasonable return on their investment without levying unjustifiably high charges to content developers/providers.

The monthly fee is however set to increase slightly year on year, to factor in inflation, in the subsequent three years to 2019.

The new rates became effective on 1st December2016.

Broadcasters within Nairobi will pay Sh89, 545 in per megabit for signal distribution in 2016, Sh91, 753 in 2017 and Sh93, 411 in 2018.

Those in other major towns this year  they will pay Sh37, 311, Sh38, 306 in 2017 and Sh39, 074 in 2018.

In 2013 the CA introduced a fee of Sh125, 990 per megabit for Nairobi and its environs, and Sh93, 202.75 for other areas in Kenya, from the previous Sh1.135 million charged per channel and Sh248, 141 per megabit for signal distribution services within Nairobi.

The new BSD framework consists of two main components: a price cap for broadcasting charges on a new cost model, and a Reference Access Offer (RAO) describing the services to be provided to broadcasters by the two national BSD operators.

The study also recommended that all channels must pay all the listed charges for the services used, except that the charges for must-carry channels included in pay-TV bouquets are to be paid by the pay-TV provider rather than the channel.

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