MultiChoice’s controversial contract with SABC under the spotlight again

Former SABC board member Mathatha Tsedu raised questions about a controversial contract between the SABC and MultiChoice signed a decade ago.

Tsedu was referring to the R533 million commercial channel supply agreement between MultiChoice and the SABC, which was announced in 2013.

The deal included MultiChoice paying for the SABC’s 24-hour news channel, getting control of SABC’s archives, and exclusivity on the state broadcaster’s best programming.

However, former Communications Minister Yunus Carrim alleged it did not stop at a content and archive agreement.

Carrim said the deal between MultiChoice and the SABC was all about ensuring that there was no signal encryption in South Africa’s digital TV specification.

Signal encryption would make it easier for companies like e.tv to enter the pay-TV market – something which MultiChoice allegedly wanted to prevent.

According to Carrim, MultiChoice inserted a controversial clause into its SABC agreement, ensuring the public broadcaster followed the pay-TV giant’s stance on encryption.

He alleged that former MultiChoice CEO Imtiaz Patel made it clear that excluding this clause in the agreement with SABC would be a deal-breaker.

What followed was that the SABC changed its official stance from supporting encryption to opposing it – all within a matter of weeks.

Carrim said the R553 million deal between MultiChoice and the SABC was irregular and unlawful and aimed at influencing government policy.

Despite numerous allegations and reports about corruption and state capture, the Judicial Commission of Inquiry into State Capture dismissed these allegations.

The commission said it found no evidence to support allegations that MultiChoice behaved improperly when negotiating the SABC channel carriage deal.

“There is no evidence on which a finding can be made that MultiChoice’s lobbying in this regard included acts of fraud or corruption,” the commission said.

Tsedu has now provided additional information related to this deal involving former SABC COO Hlaudi Motsoeneng.

Tsedu told Newzroom Africa’s Xoli Mngambi that when the SABC visited MultiChoice to discuss the R533 million content contract, it included a team of people.

“If you look at the composition of the delegation who visited MultiChoice, it was clear that Motsoeneng was not alone,” he said.

However, after they arrived at the MultiChoice office, everyone remained in the visitors’ room, and only Motsoeneng attended the meeting.

After completing the meeting, he informed the delegation that they could leave. They did not form part of any discussions.

After arriving back at the SABC, Motsoeneng allegedly told the head of legal that a contract from MultiChoice would arrive to be approved.

“MultiChoice got to draft its own contract with the SABC. The head of legal was instructed to make sure that everything moves – and he did,” Tsedu said.

Motsoeneng dismissed Tsedu’s latest allegation, saying he was not truthful about what was really happening at the SABC.

He added that Tsedu lied and that he had already served him a letter of demand to withdraw his statements.

Commenting on the deal, Motsoeneng said the SABC rewarded him for bringing the SABC News channel to MultiChoice’s DStv platform and generating additional revenue.

“I was paid money by the SABC – money that I raised. It was not from the SABC. My legacy is DStv channel 404 [SABC News],” he said.

“The SABC recognised the good work I have done outside of the SABC and my contract of employment.”

Motsoeneng is currently embroiled in a legal battle over the R11 million fee the state broadcaster paid him.

This fee, which has increased to R18 million because of interest, has been declared unlawful and invalid by the Johannesburg High Court.

Motsoeneng is challenging the ruling, arguing that he did nothing wrong when receiving a “success fee” from the SABC.

MultiChoice told Daily Investor that its SABC channel carriage agreement has been renewed multiple times under different boards and SABC CEOs. 

“There is no basis for any suggestion of corruption regarding the MultiChoice-SABC channel carriage agreement,” MultiChoice said.

“The agreement has also been independently considered in multiple forums, and no finding of corruption has ever been made.”