MUSIC INDUSTRY’S SUBMISSION TO ICASA ON THE REVIEW OF REGULATION ON SOUTH AFRICAN LOCAL CONTENT: TELEVISION AND RADIO

1. Introduction

The broadcasting and entertainment industry is an important part of South Africa’s socio-cultural and socio-economic transformation project. The music industry is an important subsector of this industry, not only for entertainment but; for real change and progress towards a truly developmental and culturally free society. As part of the creative arts, music and dance have contributed immensely to changing whole societies’ popular culture and have enriched human development in many ways. Music and dance forms part of the ‘higher order’ standard of living of human beings. A people is not completely free unless it can fully tap into its creative human  potential and express themselves culturally, either as producers or consumers of culture.

The music industry welcomes the opportunity to make submissions to the Independent Communications Authority of South Africa (ICASA) on the Review of Regulations on South African Local Content: Television and Radio. Our submission is deliberately sector specific and will not waste time in regurgitating statistics and facts that are readily available to all concerned in this review process.

It is important to preface our submission with the very important objectives of regulating local content. The objectives are:

a)  The development of a national culture.

b)  The twin imperatives of promotion of freedom of expression and cultural diversity.

c)   The development of a domestic market and industry for indigenous content,  

d)   The development of an export market and globally competitive industry.

e)    The development of the music industry as part of the economy of South Africa that contributes to job creation and well-being of South African, and

f)    The growth, development and maintenance of our Heritage as South Africans

Objectives (c) and (d) speak to the broad developmental policy thrust of the democratic government. Such a policy thrust is captured in documents such as the National Development Plan, the New Growth Path and the Industrial Policy Action Plan II. In broad terms, these policies direct South Africa to a higher developmental and economic growth trajectory that will help all of society to resolve the challenges of poverty, unemployment and inequality. Our objectives are also in line with the National Development Plan – Vision 2030, the Department of Arts and Culture’s Mzansi Golden Economy strategy and the National Youth Policy to name but a few.

In the main, our submission is aimed at strengthening the voice and the regulatory hand of ICASA towards playing a greater catalytic role in leveraging the creative (music) industries to realise the developmental ambitions of South Africa. In other words, the music industry has a stake in moving South Africa forward. In this regard, the role of ICASA is important to spurring the music industries’ contribution by improving the broadcasting environment.

2.  Rationale

The music industry appreciates the progress made in changing the broadcasting environment since 1994. Indeed many strides have been made to transform the environment in which broadcast products are produced, presented and consumed.

More importantly for the music industry, is the link between an increase in local content and the growth of the industry. Indeed as the Discussion Document states:  ‘While limited data available on the music industry (such as a national top20 charts) inhibited a study of whether or not the introduction and increase in quotas has resulted in increased production and sales of local music, international research reviewed indicates that there is a direct link.[1]

Therefore we believe that more than anything, a careful and clear economic case has to be made for an increase of local content quotas. We believe that there is sufficient consensus that it is both in South Africa’s public and the music industry’s interest to increase local content airplay. The debate then should firmly focus on the acceptable percentage quotas. At the top end of the music industry value chain, are the various broadcasting platforms and technologies, both public and private.

3.  Opportunities and benefits

Radio, is still by far, the most accessible broadcast medium, technologies changes notwithstanding. According to All Media Production Study (AMPS), listenership has increased in line with broadcasting rights issued. Listenership has remained stable since 2002, at around 90 percent. The top five radio stations are public stations (Ukhozi FM, Metro FM, Umhlobo Wenene FM, Lesedi FM & Motsweding FM). The data goes further to show that a significant section of the listenership between LSM 4-7 is with the four most popular stations. This means that about 24-5 million South Africans, mainly adults, are spread across these five South African Broadcasting Corporation (SABC) radio stations.

On the television side, the latest Census data shows that the numbers of households with working televisions has increased from 53.8 percent in 2001, to 74.5 percent in 2011. The SABC has more than 25 million viewers.

In terms of quotas, research shows that for the most part, public radio stations comply with the 40 percent minimum requirement for local content. However, non-compliance is still a challenge to some stations. MetroFM, the second biggest public commercial station caters mainly for the middle and upper classes. And yet, MetroFM has 25 percent of local content, far much less than the regulated 40 percent. In so far as we are concerned, it is not clear as to whether the other broadcasters in other formats comply fully.

As such, despite the emergence of new technologies and thus new forms of piracy, the music industry still relies a lot on radio for revenue and growth or sales and the industry as whole. Radio is also still the strongest platform for exposing our culture, traditions and heritage to all South Africans. In this context, the SABC becomes important as a public broadcaster ‘broadcasting for the total citizen empowerment’.

In terms of government public policy posture, state owned enterprises (SOEs) are at the centre of building a developmental state. And the whole drive for the re-industrialisation of the economy depends in many respects, on SOEs that articulate and implement in vigorous manner their ‘public mandates whilst ensuring commercial viability’. The creative industry, of which music is part, is one of the opportunities available for re-industrialisation and the SABC plays an important part in promoting local content.

According to the SA government, ‘the music industry was worth around R1.7 billion in sales and ranked 17th in the world in 2007. The music industry is labour intensive and has many economic multipliers with the potential to generate significantly more employment than it already does. The Gauteng province alone employs around 18 800 people with the potential for significant expansion.

The value of the performing arts is best represented as a sample by the 2008 Gauteng Creative Mapping Project6. The activities included in the study are dance, orchestra, music, opera, musical theatre, theatre, comedy, circus performance, magic shows, poetry and storytelling. The turnover in the sector in Gauteng was estimated at R 260 m, gross value added of R 166 m and employing 2 200 people.’[2]

As the foregoing suggests, there are many opportunities that lie ahead of the music industry and by and large, the industry is ready and embracing the changes that are taking place in terms of regulation, technology and related aspects.

Increasingly, the industry is getting organised in terms of protection of labour rights of creative workers. Various associations (e.g. Association of Independent Record Companies - AIRCO, Music Management Forum of South Africa -MMFSA, South Africa Music Promoters Association - SAMPA, South African Music Rights Organisation - SAMRO, National Organization for Reproduction Rights in Music in Southern Africa - NORM, etc.), a union (Creative Workers Union of South Africa – CWUSA) and a federation (Creative Industries Federation) exists and thus greater momentum for unity is gathering. The relationship with the state, investors and owners is increasingly formalised. It must be noted that the industry still has high levels of exploitation and many workers are still vulnerable in the sector. Therefore a sense of stability in terms of minimum employment conditions, compensation, rights and various forms of protection can only be guaranteed by the state and its regulatory agencies such as ICASA. It is exploitation to have less than desired local content because it undervalues creative workers and undermines efforts of cultural freedom, social cohesion and economic growth.

4.  Recommendations

The industry proposes the following as changes:

a.  That as a general principle, ICASA regulations must always consider the interplay of the foregoing aspects when it regulates the broadcasting industry, better to appreciate the very important permutations in the industry.

b.  That research and development into the music and related industry should be improved and ICASA has a role to play in this regard.

c.  That ICASA should prioritise local content over foreign content, and that the public broadcasters should be at the forefront of these new quotas.

d.  That given the proven link between airplay and market growth, the regulations must stipulate new quotas: local content on must be increased to a minimum:

 

RADIO

-  80% minimum for community sound broadcasting licensees

- 80% minimum for public sound broadcasting licensees 

- 70% minimum for private and public commercial sound broadcasting licensees

- 50% minimum for subscription sound broadcasting licensees, and

 

TV  

-  80% minimum for community licensees

- 80% minimum for public sound broadcasting licensees 

- 70% minimum for private and public commercial broadcasting licensees,

More local content means more local revenue, growth of industry, better quality products and various spin-offs for the entire value chain. We have enough music content for all broadcasters to play South African content and it will only grow with the proposed increase.

e. That ICASA should continue to explore new and innovative ways to incentivise those who comply and disincentivise those who do not comply.

f.  That beyond regulation, ICASA, should use these processes of regulation review to engage the industry on a higher level commitment: a social compact of the broadcasting industry to respond to the National Development Plan. Our emphasis is that regulation alone is not sufficient to get better outcomes.

The big cultural, moral and conscientious question remains: what makes us ashamed of staking out all and standing firm that half of what we consume from the creative industry should reflect our lived experiences, our South Africa stories? Who else must tell these stories except us?

Our submission is a principled one: we want equality with foreign content. Our humanity is indivisible. We are not a market for others; we want to be engaged as equals of equal worth, in an industry that says: we all have equal cultural rights! It is time to tell OUR GOOD STORIES! As we look forward to the next 20 years of the development of South Africa, we believe that the quotas should be as we are recommending in our submission.           

The state and the Authority must therefore play their role as equalisers, without any doubt!

The music industry is committed to improving local content quality and diversification of genres but an enabling environment must be created through regulation, funding and other forms of support from both the state and related agencies.

 

The increase of the quota in favour of local music content as based on our submission is crucial in the development of South Africa’s economy and heritage. Currently, over 60% of revenue made in the South African music industry (including broadcast Royalties) leaves our country which is a huge loss to the development and reinvestment into our local music industry. Even the new revenue streams which include Needle Time will still benefit foreign artists who are not based in South Africa if the music quotas are not changed. This also means that a huge amount of South African tax payers money that is paid by government owned broadcast institutions and community broadcasters leaves our shores to benefit artists in foreign countries like the US and Europe, instead of circulating in South Africa.

The increase in South African content has huge benefits for our country and will save the struggling South African music industry by increasing sales of South African music, increase the number of live performances in South Africa, increase the love, support and knowledge of South African content in South Africa and the world, increase job creation opportunities and safeguard our culture, traditions and heritage as proud South African.

END.

 

[1] Discussion Document on the Review of Regulation on South African Local Content: Television and Radio, July 2014, p33-34.

[2] The Department of Arts & Culture. Mzansi’s Golden Economy – Contribution of the Arts, Culture and Heritage Sector to the New Growth Path, 2011, p18.