MultiChoice denies tariff increase, insists PAYG not feasible
As Reps accuse firm of insensitivity to Nigrians
Chief Executive Officer of MultiChoice Nigeria, John Ugbe, yesterday, faulted claims that it reviewed it tariffs for all its bouquets and services upwards.
Testifying before the House of Representatives Ad-hoc Committee investigating non-implementation of the Pay-As-You-Go (PAYG) subscription model by satellite television service operators, he explained that the company only implemented the new Value Added Tax (VAT) rates in line with prescribed rules and regulations.
Ugbe, whose outfit owns DSTV, stated that the company considered inflation, increasing costs of input and technical upgrades, impact on subscribers, as well as exchange rate fluctuations to arrive at tariffs.
“Due to the current economic realities, some of these factors have over the years negatively impacted our cost of doing business and have put us under very challenging conditions,” he said.
Ugbe insisted that PAYG billing model was not technically and commercially feasible in the satellite television industry.
While noting that Pay-Per-View (PPV) was often confused with PAYG, he explained that the PAYG model used in the telecommunications sector was not the right mix for pay television.
He explained that PAYG in the telecommunications sector was a metered service that ensured consumers were billed only for the service they consume and not for a fixed period.
He added that PAYG was possible in telecommunications because it relies on a two-way communication system, which enabled operators to determine when consumers are connected, services consumed and duration of connection.
But Chairman of the Committee, Unyime Udem, insisted that MultiChoice was insensitive to the plight of Nigerians for increasing the tariff of their various bouquets and anchoring the decision on VAT increment from 5 per cent to 7.5 per cent.
He argued that in actual sense, the prices of most of its bouquets were increased for over 2.5 per cent, unlike many other local and international companies that were providing palliative measures to cushion the effects of the COVID-19 pandemic.
Stressing the need for a healthy competition in the broadcast industry, he maintained that PAYG was feasible in the country, noting that the committee’s mandate was simple.
“We will, therefore, like to restate that we are fully committed to the full implementation of the PAYG, PPV and pay per watch (PPW) model in the country,” he noted.
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