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StarTimes’ StarSat faces September shutdown as South Africa rejects company’s licence renewal

Key Points:

  • Notification and Directive: ICASA informed OnDigital Media through a formal letter, instructing them to halt broadcasting by September 18, 2024.
  • Internal and External Communication: There are indications that OnDigital Media has not yet informed its employees or its parent company, StarTimes, about the situation. The company continues selling StarSat decoders.
  • Regulatory Correspondence: ICASA had previously communicated with OnDigital Media’s CEO and General Manager for Legal, Risk, and Compliance, instructing them to prepare subscribers, content providers, and investors for a potential shutdown.
  • Public Announcement Threat: ICASA warned it might publicly announce the cessation of OnDigital Media’s services, affecting all stakeholders.
  • Company’s Response: Debbie Wu stated that OnDigital Media is pursuing all regulatory and legal options to renew its licence and avoid a shutdown. The company is preparing to comply with regulatory instructions if renewal efforts fail.
  • Market Impact: StarSat’s potential exit from the market could significantly impact the competitive landscape of South Africa’s pay-TV sector, reducing competition and consumer choice.

The Independent Communications Authority of South Africa (ICASA) has decided not to renew the broadcasting licence of OnDigital Media, the company operating StarSat, the South African division of the international broadcasting group StarTimes Media.

This decision mandates OnDigital Media to cease its broadcasting services by September 18, 2024.

ICASA’s decision was conveyed through a formal letter to OnDigital Media’s management. The letter instructed the company to halt all broadcasting activities by the specified date. However, the specific reasons behind ICASA’s decision and any conditions that OnDigital Media might need to meet to secure a new licence were not disclosed.

Reassurance Amid Uncertainty

Despite the directive from the regulator, OnDigital Media’s CEO, Debbie Wu, has reassured the company’s customers and stakeholders that there are no immediate plans to shut down operations.

“We can assure you and the public that OnDigital Media/StarSat will not be closing its operations anytime soon,” said Wu.

Also read: MultiChoice reverses DStv, GOtv subscription fee hikes after court ruling

She also mentioned that the company is currently in discussions with ICASA to find a mutually agreeable solution.

An insider revealed that OnDigital Media has continued its business operations as usual, including selling StarSat decoders to new customers. However, it appears that the company has not yet communicated the situation to its employees or its parent company, StarTimes.

Regulatory Communication

In early June 2024, reports emerged that ICASA had not renewed StarSat’s broadcasting licence.

According to sources, ICASA sent a letter to Debbie Wu and Ronald Reddy, the General Manager for Legal, Risk, and Compliance, in mid-March. The letter instructed OnDigital Media to prepare its subscribers, content providers, and investors for the potential cessation of its broadcasting services, according to Innovation Village.

ICASA also warned that it might publicly announce the winding up of OnDigital Media’s broadcasting services on its website or in the Government Gazette, thereby alerting all affected parties.

The regulator directed OnDigital Media to outline its strategy for communicating the shutdown to its subscribers, content providers, and investors.

Pursuing All Options

In response to the situation, CEO Debbie Wu indicated that OnDigital Media is actively pursuing all available regulatory and legal options to secure the renewal of its licence and avert the impending shutdown.

“We are committed to exploring every avenue to continue our operations and service to our customers,” Wu stated.

She expressed confidence that the company’s efforts to renew its broadcasting licence would be successful. However, she acknowledged that if these efforts do not yield the desired outcome, which she considers unlikely, the company is prepared to act in accordance with the regulator’s instructions.

Wu assured that, in such an event, OnDigital Media would fulfill its obligations and communicate the necessary information to all parties involved, including subscribers, content providers, and investors.

Market Implications

StarTimes, a Chinese pay-TV service, holds a 20 per cent stake in OnDigital Media, which is the maximum level of foreign ownership permitted for a media company in South Africa. This investment underscores the interest and involvement of international players in the South African media landscape.

Should StarSat be required to cease operations, industry reports predict a significant impact on the competitive landscape of South Africa’s pay-TV market.

StarSat is recognised as one of the top three contenders in the market, alongside DStv and Openview. Its potential exit could lead to reduced competition and choice for South African consumers in the pay-TV sector.

Samuel Bolaji

Samuel Bolaji holds a Master of Letters in Publishing Studies from the University of Stirling, Scotland, United Kingdom, and a Bachelor of Arts in English from the University of Lagos, Nigeria. He is an experienced researcher, multimedia journalist, writer, and Editor. He is currently the Editor of Arbiterz.

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