Presentation to the Portfolio Committee on Communications 15 March 2006

1
Presentation to the Portfolio Committee on
Communications15 March 2006

• Board of Director Members Chairperson, GCEO, COO
  CFO

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Mission, Vision Promise

• Mission
• To deliver distinctive and compelling programming
  through sound business practices
• Vision
• To be the pulse of Africas creative spirit
• South African Citizen Promise And Positioning
• Your SABC The Story teller of the Nation

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Chairmans Introduction

• GCEO appointed and taking charge of driving the
  organisation further
• Focus of Board on ensuring the public broadcaster
  from a strategic and policy perspective are
  effectively positioned
• Core corporate goals continue to inform our
  strategies and the allocation of resources
• African Renaissance
• Social Cohesion
• Nation building
• Transformation
• People
• Technology
• Entering a new phase of challenge
• Board is supporting the GCEO and the management
  team to position the organisation for success in
  a world of increasing choice and a need for
  services and content that speaks to the wants and
  needs of citizens

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Chairmans Introduction

• Challenges are eagerly approached but not easily
  overcome in all instances
• Support from a range of stakeholders will be
  sought going forward particularly in the areas of
  the development of the local production industry
  and the expansion of SABC services and platforms
  e.g. Regional TV
• The SABC finds itself at one of its strongest
  points financially in its history
• These resources will be channeled into ensuring
  the SABC continues to improve on delivery to this
  nation and the creation of a better world
• The public broadcaster thanks the committee for
  its support and requests it support going forward

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GCEOs Overview

• The SABC is concluding a year with significant
  signs of progress and achievement along a number
  of fronts
• Radio audiences have largely been maintained or
  improved relative to private sector operators
• TV audiences are up SABC 2 recaptured the number
  two channel position
• The SABCs brands at Corporate, channel and
  station levels featured significantly in the
  latest Sunday Times/Makinor surveys
• SABC services have been expanded on both radio
  and TV to reach thousands of South Africans
  previously denied
• Regional TV licences were granted, although not
  issued
• Licences for existing services were amended
• Siyanqoba campaign was launched with the broader
  purpose of using sport amongst others to drive
  the development of a psychology of a Winning
  Nation

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Access to News and Information

• Increased access to SABC services as source of
  information and entertainment fundamental to
  delivery of public mandate
• In last five years SABC radio and TV services
  have been expanded to reach over 5 million
  additional citizens particularly in rural areas
• Over the course of the fiscal a number of
  applications to extend transmitter coverage were
  submitted to ICASA. Among those approved by ICASA
  in the 2005/06 financial year were
• The expansion of Ikwekwezi FM in Pretoria
• The expansion of Lotus FM in PE
• The expansion of Lesedi FM in KwaZulu Natal
• More must be done
• SABC Universal Access Committee has been
  established and is working to identify and
  implement expansion plans in ISRDP nodal points
  and other areas
• Analogue technology has limitations digital
  technology solutions will be the most effective
  in enabling broadcast services accessibility

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Access to News and Information

• Digital technology will more effectively
  facilitate the delivery of services in all
  languages and to all communities, particularly on
  TV
• Public broadcaster is pleased to see this issue
  on the agenda of the Economic Cluster and are
  encouraged by the initiatives to promote
  Broadband usage and the digitization of
  transmission infrastructure being led by the DoC
• All of us need to take steps to further the pace
  of this process especially given the demands of
  2010 WCS

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Information for Democratization Nation Building

• Increase the spread of current affairs
  programming and the language spread of current
  affairs shows.
• Launched of Weekend Morning Live on S2
• Sesotho TV CA Show launched
• Additional programs to be introduced
• Improving skills base
• Staffing training for specialist desks. Develop
  more beat journalists
• Editorial workshops and frequent training
  opportunities for regional editors and bulletin
  desk editors
• Making the SABC accessible to the general public
  by interactive current affairs programming E.g.
  conducting at least 3 OBs a month
• Strengthening capacity of SABC News by opening
  new bureaus in Africa, Europe, Asia and Americas

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Elections

• News Division gave comprehensive coverage of
  local elections, leading up to, during and post
  elections, making a significant contribution to
  nation-building and the deepening of democracy
• Over 990 editorial and technical staff were
  involved in providing coverage from all parts of
  the country, on radio, television and new media
  platforms in 13 languages.
• Through OBs before the elections, citizens were
  given an opportunity to engage political parties
  on issues of relevance
• Broadcasts undertaken across the country in
  rural, periurban and urban areas
• All parties were covered equitably
• SABC coverage has been lauded by private citizens
  and political parties for its fairness,
  accessibility, balance and comprehensiveness.
  There were fewer complaints lodged against the
  SABC than in any previous election and none of
  these were upheld.
• SABC made a significant contribution to building
  a winning nation and the deepening of democracy

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Social Cohesion Nation Building

• South Africa is alive with possibility. However,
  the countrys difficult past, leaves much to be
  done in terms of building and establishing
  bridges across the chasms that divide society and
  addressing inequities.
• The public broadcaster is an important
  institution with a key role to play in building
  the nation, creating an environment conducive for
  social cohesion to take root and prosper and a
  shared sense of national consciousness to form.
• Many of the SABCs off and on-screen efforts over
  the fiscal were directed at addressing the
  challenges and opportunities facing the nation
• Sport is a key platform on which the nation can
  build.
• An important campaign initiated by the public
  broadcaster over the course of the fiscal was
  that of Siyanqoba.
• The campaign has a wider goal of promoting the
  message to citizens across the country in rural,
  peri-urban and urban areas of participating in
  and being a part of a winning nation.
• The campaign will be extended to other sporting
  codes and applied in new ways in the coming
  fiscals. E.g. Tsotsi inspires the Proteas to
  historic victory (Sowetan)

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African Renaissance

• A significant focus of the SABCs on and
  off-screen efforts is on supporting the African
  Renaissance in our nation and on the continent.
• SABC Africa continues to feature on a free-to-air
  basis via its terrestrial window on SABC 2.
• There are advanced plans in motion to launch a
  twenty-four hour news channel that will feature
  on free-to-air platforms throughout the
  continent.
• SABC News domestically increased the amount of
  coverage devoted to the rest of the continent on
  the terrestrial channels and PBS radio stations.
• The SA BCs content commissioning efforts in
  other genre have been underpinned by an approach
  to celebrate the African story through investment
  in capacity building, transformation, partnering,
  development and enhancement of the broadcasting
  industry locally and continentally

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African Renaissance

• In line with its mandate, Channel Africa produced
  programmes that cater for adults and also
  introduce programmes for the youth and children.
  It was also successful in producing programmes in
  six Languages English, French, Shilozi,
  Portuguese, Chinyanja and Kiswahili
• Audiences have increased through 24 hrs broadcast
  on two platforms, Internet and Satellite.
  Partnerships with WRN and CBC Radio have also
  increased audiences through their rebroadcasts of
  Channel Africas programmes. The Service
  continues to receive positive feedback from
  listeners.
• Programmes reflected cultural, socio-political
  and economic realities of Africa. These
  programmes support the vision of Channel Africa.
• On Television we are actively pursuing discussion
  with other African Broadcasters aimed at
  expanding our footprint beyond satellite

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Playing Leading Role in Raising the Bar of
Industry Delivery

• Media in Society
• The SABC has a leading role to play in helping to
  raise the bar of relevance, delivery and
  effectiveness for all players in the media
  sector.
• As part of its commitment to advance this cause,
  the SABC co-hosted the Media in Society
  Conference with SANEF and the University of
  Limpopo.
• The main objectives of the two day session were
  to bring together leading electronic and
  non-electronic media players to discuss and
  debate key societal/industry issues and chart a
  way forward for the sector with regards to how it
  can serve its important role more effectively.
• Over 180 delegates attended the session.
• The SABC continues to take a leading role in
  ensuring the agreed actions flowing from the
  session are being addressed.

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Legislative/Regulatory

• The amendment of the SABCs licence conditions by
  ICASA was the most significant regulatory
  milestone yet for the public broadcaster.
• The Broadcast Amendment Act of 2003 specified
  that the SABC apply for amendments to its
  licences to reflect reorganization. The process
  of amending the licences took over a year and
  involved multiple public hearings and responses
  to submissions made by third parties. ICASA
  published draft licence conditions in February
  2005 and the final licence conditions were
  published in June 2005.
• The new conditions come into effect at the end of
  March 2006. The new licence conditions lay out in
  detail the programming to be provided by the SABC
  for the duration of the licence term and in that
  sense the conditions provide a measurable
  benchmark for PBS delivery.
• There will therefore be significant changes to
  the SABCs radio and television schedules arising
  from the conditions.

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Delivery on Local Content

• SABC is the largest contributor to the growth of
  the local production sector, directly and
  indirectly the Corporation injects over R1B into
  the sector annually
• Local content, whilst in many instances yields
  high social returns, is much more expensive than
  foreign content to commission and showcase
• Shareholder collaboration in developing the local
  content industry is required SABC cannot
  effectively shoulder the burden alone
• Aligned to Governments objectives to reduce the
  cost of doing business
• Facilitating a shared national consciousness,
  identity and social cohesion
• Help to ensure that television platforms do not
  fall into the trap of being conduits of
  reversioned Hollywood foreign content
• To this end, the SABC previously proposed that a
  Local Content Fund be established with support of
  relevant stakeholders The SABC has committed
  R45m for local film in the new fiscal

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Regional TV Channels
Programming for Nation Building Social Cohesion

• The granting of the licences for two regional
  channels represents significant advancement in
  the delivery of public broadcasting in South
  Africa
• The Corporation proposed two public regional
  television services SABC 4 and SABC 5 each
  licensed for an eight year period
• The services are envisaged to broadcast initially
  four hours of original programming per day. This
  daily broadcasting time would grow to eight hours
  per day during the period of the licence
• All of the commissioned programs will be in
  African languages
• The SABC is currently working with the DoC to
  secure the required financial support to roll out
  and operate these services over their licence
  periods

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Technology

• Plan consists of four key elements
• Broadcast technology solutions
• Information technology solutions
• Facilities development and management
• Human capital development
• The implementation of the strategy requires
  R1.3bn over five years and is already underway
• A key area of success for the corporation was
  securing R450M over the MTEF period to upgrade
  the technology base of the corporation.
• The benefits of this investment are significant
• Skills development
• National priorities and objectives i.e.
  supporting delivery of 2010
• Ensuring uptime
• Improving quality and lowering cost of content
  delivery
• Improving access, including disabled communities
• Key projects are underway in line with the
  technology plan developed in FY02/03. One of the
  biggest challenges however is putting in place
  the capacity to initiate and complete a number of
  large and complex projects. Steps are being
  taken to secure the necessary capacity and
  expertise where deficiencies exist. Management
  fully expects that the plan will be successfully
  executed against in the upcoming fiscal and
  beyond.

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2010

• The World Cup in 2010 will be able to provide our
  entire broadcast fraternity with new
  infrastructure this will be the legacy
• It also presents radio with the opportunity to
  upgrade equipment and radio production skill
• A great opportunity to close the gap with the
  first world in broadcasting terms. i.e.
  Syndicating Productions
• Showcase Africas growth capabilities and
  potential through empowering human capital
• Enhance and exploit commercial opportunities
• The SABC is committed and gearing up to deliver
  a professional and world class quality product

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2010

• The right to host 2010 also comes with a number
  of obligations from a broadcasting and
  telecommunications infrastructure perspective
  e.g. IBC and media centers
• Whilst elements of the SABCs existing technology
  plan will assist in the delivery of 2010, the
  event requires incremental and substantial
  investment over and above the current plan
• Initial estimates put the total incremental costs
  at R1.3bn
• Important to note that this excludes broadcast
  right costs
• Digitisation of transmission network across SA is
  essential to ensure sufficient platforms to bring
  the World Cup to the South African public
• Discussions are underway with the Shareholder,
  the LOC and other partners to ensure a successful
  World Cup is delivered

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BEE/SMME Development

• Major external expenses of SABC include
  Programming and broadcasting, marketing and other
  goods and services total gtR2B
• The SABC is firmly committed to implementing the
  requirements of the ICT charter and is currently
  in the process of revising minimum targets for
  all categories of spend and for each category of
  BEE firm
• Devolving responsibility to regions for certain
  categories of spend to more effectively promote
  economic development outside of Gauteng
• Appointing a Head of Procurement to more
  effectively direct, monitor and report on spend
  across the public broadcaster

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Financial

• Financially the SABC will improve on it historic
  performance of FY04/05
• Successes of the past are not a cause for
  complacency, significant challenge faces the
  public broadcaster e.g.
• Nation building
• Implementing new licence conditions
• Improving and expanding access to SABC services
• Operating in an environment with increasing
  competition not only for audiences but also for
  commercial funding
• Industry development in relation to the local
  production industry
• Legislative change i.e. Electronic Communications
  Act
• Gearing up for 2010
• Budget and strategy process that has been
  informed by amongst others the above

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The Way Forward

• Critical to the achievement of these objectives
  on a sustainable basis are the following
  strategies
• Identifying and exploiting new opportunities in a
  converging media landscape
• Creating adequate platforms and appropriate
  infrastructure for enhanced delivery cf. 2010
• Increase services towards marginal communities -
  deaf/hard of hearing audiences,
  children/education
• Creating and implementing an economic and human
  development approach for content creation
  industries that will enable the development of
  South African themes issues and stories
• Establishing a sustainable and adequate funding
  model to achieve these goals
• Expanding and improving participation of Black
  and SMMEs in the broadcasting value chain

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Three Pillars

• Conversations Partnerships
• Restoring Dignity
• Building a Common Future

People centered, Technologically Driven
Strategically Focused Public Broadcaster
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Strategic Themes
The overall themeServing the Citizen in
everything that we do.
Description
Citizen Employees
Occupying a trusted, accessible and important
place in the daily lives of South Africans
Create a supportive, caring and progressive
environment that rewards performance, encourages
team work, innovation and attracts, retains and
develops the best creative and technical capacity
in the industry
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Strategic Themes
Description
Content Finances
Investing and effectively exploiting distinctive,
relevant and quality content across existing and
new platforms Ensure a viable and
sustainable funding base and strategy are in
place to support the effective delivery of the
public service remit
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Strategic Themes
Description
Ensuring an effective and relevant technology
base is in place to support the delivery of the
public service remit Aggressively embrace
and pursue a multiplatform approach to delivering
on the public service remit
Technology Platform
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In Support of Plan of Action



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In Support of Plan of Action



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Key Projects Associated Timing
Area
FY06-07 Q1
FY06-07 Q2
FY06-07 Q3
FY06-07 Q4

• Universal Access
• Funding Strategy
• Employee induction program
• Technology Plan
• 24 Hour News Channel
• Subscription Broadcasting ITA
• Regional TV
• Succession Career Pathing
• Industry Development

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Financial Performance


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Conclusion

• The public broadcaster has an important role to
  play in building the nation, promoting social
  cohesion, reflecting cultural and regional
  diversity in a unifying manner
• This role is made more complex, given the
  organisations funding mix
• The SABC is however well positioned to leverage
  its audiences and platforms to further push the
  boundaries of mandate delivery
• SABCs on and off screen efforts will continue to
  focus on important social issues and matters
  concerning the public in a structured and
  systematic way
• The competitive environment and the reality of
  convergence have created a number of imperatives
  for the corporation e.g.
• to extend its content exploitation beyond the TV
  screen and radio speaker
• to begin to shift its funding base to more of an
  annuity stream model, as well as increase
  revenues from our merchandising and exploitation
  units.
• Human capacity to implement and exploit
  opportunities is the corporations biggest
  challenge, and the SABC is actively building
  leadership, management and technical capacity
  within the corporation as well as the industry

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Conclusion

• We have reached a critical juncture in the
  development of our nation
• We believe that this is equally a juncture of
  historic significance for the national public
  broadcaster
• This is marked by the range of challenges that we
  have to face in this second decade of our
  democracy
• Enhanced delivery will require the expansion of
  our platforms and the building of the
  broadcasting infrastructure in partnership with
  DoC, Sentech, Telkom and others
• An economic and human development model for
  industry advancement is essential for us to
  develop and promote South African content at
  scale and on a sustainable basis.
• The SABC will do its part but needs the support
  of the Shareholder and other relevant parties as
  well

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Conclusion

• The budget presented, including incremental
  funding requests from the Shareholder, are
  underpinned by strategies that seek to position
  the public broadcaster centrally to positively
  contribute to the on-going project of nation
  building SABC
• Moreover the strategies seek to ensure that the
  broadcaster remains viable and relevant in a
  environment that will undoubtedly be much more
  dynamic and competitive than in that which we
  find ourselves currently
• As the public broadcaster moves forward we thank
  this committee for its ongoing support and share
  with you our commitment to the development and
  continuing transformation of the local production
  industry by announcing that the SABC has created
  a film fund for local productions with an initial
  investment of R40m in this years budget.