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Fiji TV’s monopoly and the need for competition [The Fiji Times, 22 April 2003]

28/03/2012

With the Commerce Commission’s decision not to extend Fiji TV’s monopoly, the Fiji Government faces a dilemma.

The dilemma is not about choosing the right economic policy.  The right economic policy is quite clear and has been clear for years.

Government’s dilemma is political: how choose between two opposing political interests.

On the one hand are the small but influential group of indigenous Fijian shareholders allied with a powerful Indo-Fijian company.

On the other are the wider long-term development needs of the wholeFijicommunity, including that of the bulk of ordinary indigenous Fijians.

And there is a third vital issue of good governance- should Government interfere with a process that was set up by Government itself to be independent of political interference?

Clear economic policy

  For years now, various Fiji Governments have committed themselves to deregulation and greater competition, to encourage economic growth and consumer welfare.

Hence the passing of the Fair Trading Acts and Amendments.  Hence Government’s signing of the World Trade Organisation (WTO) treaty.

Hence the setting up of the Commerce Commission, with the primary aim of promoting “effective competition in the interests of consumers”.

And the Commerce Commission received thousands of submissions from the public.   Mostly complaints.  Nearly all called for an end to Fiji TV’s monopoly.

And the Commerce Commission agrees that the monopoly should end.  Yet the Government is strangely considering otherwise.

The political imperative

  Perhaps the Prime Minister genuinely believes that a Fiji TV monopoly is the best way of extending Fiji TV services (however bad the public thinks they are) to ruralFiji.

But is Government also influenced by the interests of Fijian Holdings Limited, Yasana Holdings Limited, and Punja & Sons Ltd?

The first and second interests represent elite indigenous Fijian shareholders. And the Prime Minister has been involved with both sets of interests in the past.

The third major shareholder represents one of the most powerful business players inFiji,  also a major shareholder in the company that dominatesFiji’s radio stations.  An emerging media control that is not healthy.

Undoubtedly, these shareholders stand to profit remarkably, if the monopoly continues.

Higher profits to come

  Fiji TV has enjoyed a monopoly for six years; has tax-free status for fifteen years; and exemptions from customs duties.

It already has made good profits, paid high dividends, and still built up a healthy cash reserve of over $6 million.  With the current trends in revenue and expenditure, Fiji TV’s record profits of last year, will be exceeded in the years to come.

Half of its current revenue comes from advertising on Fiji TV One (which is therefore not a “free to air” channel, as Fiji TV has  often claimed).

The other half of its revenue comes from Sky TV subscriptions and advertisements, recently boosted by the soccer World Cup.

And undoubtedly, Fiji TV’s financial success is largely due to its use of cheap poor quality programs, despite widespread consumer complaints for years.

Pathetic quality

  The Commerce Commission’s Report will probably  document the well-known complaints: lack of quality children’s programmes, lack of educational programmes, cheap mediocre and dated movies; sickening repetition; nauseating ads and ads personalities; irrelevant broadcasts (such as CCTV); lack of coverage of sports of interest to Fiji people (apart from rugby), the bad timing of many programs; little attention to Fijian and Indo-Fijian interests, etc.

Unfortunately, Fiji TV, its shareholders and board members appear, frankly speaking, not to give a damn about the complaints.

And surprising for a Fijian-controlled company, Fiji TV fails miserably in addressing indigenous Fijians needs.

Failing indigenous Fijians

  Of course, ordinary indigenous Fijians want to be entertained by TV.

But, lagging behind in commerce and pressured by globalisation, Fijians also urgently need programs that will educate them about where their world is going, nationally and globally- in business (especially relating to tourism, agriculture, fisheries, forestry), education, science and technology, politics, and the arts.

Fijians also need TV programs that will help preserve and strengthen Fijian language and culture, also rapidly eroded by globalisation.

But, despite its Fijian ownership, Fiji TV is a failure with respect to both sets of objectives.

The peak hour programs on Fiji One continue to be dominated by escapist entertainment.

For sixteen years, the fundamental institutions of our society- the government and the presidency, the judiciary, the policy and military- have been ripped apart.  But there are few programmes in Fijian or Hindi to educate our public who are not comfortable in English.  And the ignorance of our people allows demagogues to thrive.
At the height of the 2000 coups, scandalous and horrifying rumours were circulating amongst the uneducated and educated alike.  Yet Fiji TV refused to increase the news broadcasts in Fijian or Hindi  (despite pleas from concerned citizens).

And pathetically, there continues to be a mere 2 minutes of news in Fijian and Hindi.

The few Fiji One programs that are educationally relevant (like Talanoa) appear at off-peak times, with Close Up (in English) being a rare exception.

Why has Fiji TV failed to serve the needs of even the indigenous Fijian viewers?

Is it a lack of vision of the board? Or the inability of the board to influence a profit-oriented management?  Or simply “who cares as long as the profits keep rolling in”?

The profit motive of Fijian Holdings Ltd  and Punjas and Sons Ltd is understandable. But Yasana Holdings is supposed to also represent the wider interests of indigenous Fijians- not just as shareholders, but also as consumers.

It should be noted that Fiji TV pays equally little attention to Indo-Fijian culture and events.  Zee TV is largely escapist  Indian entertainment of little relevance to Indo-Fijians.

And Fiji TV continues to impose its rotten monopoly packaging of the Sky channels.

Take it or leave it

  In a rugby crazy country, Super Twelve can only be seen live on Sky Plus, not on Fiji One (despite the fact that Fiji TV makes $4 millions a year from advertisements on Fiji One).

Many educational programs can only be seen on Sky Plus.  Indian movies can only be seen on Sky’s Zee TV.

And Fiji TV, by ruthlessly packaging together Sky Plus, Sky Sports and Zee TV, thrust all down the throats of helplessFijiconsumers.

Most Fijipeople (of all races and religions) do not want to expose their families to the gratuitous violence and sex that predominates on Sky Plus.  Most indigenous Fijians do not want to see Zee TV.

But all are forced to buy the whole package, because of Fiji TV’s “take it or leave it” attitude.

Of course, Fiji TV management probably thinks that they are delivering a quality product.  And who are we to judge?

But neither should Fiji TV be left to judge by Government decree, as they have done for six years- largely for their private profit.

Must have competition

  The great benefit of competition is that the market is free to decide who should provide whatever services that are demanded by the public.  Not intellectuals. Not Government.

Of course, competition by itself may not be the answer to all our needs in television.

A new entrant may simply offer the same fare as that offered by Fiji TV (note that the offerings of Fiji Broadcasting Corporation have gradually become more and more like those of FM96).

Government may need to set stronger performance requirements for all television service providers: such as minimum hours of news in Fijian and Hindi, minimum hours on Fiji One, of locally developed programs, educational programs and key sports events of interest toFiji’s viewers; the separation of the Sky products, etc.

And if Government wants services to go to unprofitable rural areas- then let Government pay for those services, through open tender.

But theFijipublic must have choice, as the Commerce Commission has ruled.

The market must be free to respond to consumers.

And if Fiji TV still dominates in that competitive environment (as they probably will, given their head start) then good luck to it.

And for good governance, the Government should not interfere with the ruling by the Commerce Commission.

The needs of the nation over-ride that of a few shareholders in Fiji TV.

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