TopTV rocked by urgent court interdict

Shareholders including former ODM CEO Vino Govender who are extremely unhappy with the StarTimes bail-out and the business rescue plan of the struggling On Digital Media (ODM), now plan to take the Woodmead based South African satellite pay-TV operator to court to prevent the StarTimes business rescue plan from proceeding any further. by Thinus Ferreira

Unhappy and exasperated shareholders are now seeking an urgent court interdict to prevent what they see as wholesale changes to the TopTV service which could be lethal to ODM should South Africas broadcasting regulator not eventually approve the StarTimes bail-out application.

First National Media Investment Holdings and Atchuthandandan Moodley who together have a combined interest of 21,1% (20,4% and 0,7% respectively) are adamant to stop the business rescue plan being implemented by StarTimes from going any further.

The urgent court interdict will be brought on 29 October. If granted, it will further delay ODMs already delayed relaunch of its severely damaged TopTV brand into StarSat which was supposed to happen last week and was postponed to November.

TopTV relaunch as StarSat delayed

With a court application and the interdict coming to the South Gauteng High Court, it now appears that a November launch of StarSat is also out of the question as conflict rages behind the scenes at TopTV.

The ODM shareholders voted on 30 April 2013 for Chinas StarTimes - already operational in several African countries - to take over a 20% share in the beleaguered company. What it means in reality is that StarTimes acquires an effective 65% economic interest in ODM.

A fifth of the shareholders have however been extremely concerned that On Digital Media will be irreparably damaged if the StarTimes business rescue plan goes ahead but isnt successful. Meanwhile some flaws in the implementation behind the scenes have already become very visible to not just shareholders but also to ordinary commercial TopTV subscribers.

Currently the business rescue plan is the best opportunity for ODM, which is in a vulnerable position, to be rescued, says the shareholders, unhappy with what they claim are significant aspects of the business rescue plan which appears to be permanent.

Massive drama has already been playing out behind the scenes at the company, once again rocking the struggling ODM as StarTimes presence started to be felt the past two months.

Its been playing out for TopTV subscribers on their TV screens with weird new unexplained content, as well as high frustration and a consumer backlash over a new billing system which was introduced and instantly malfunctioned.

The ODM shareholders say that StarTimes is under financial stress of its own and that if StarTimes business rescue plan proceeds that it will increase the risk of the business possibly failing.

The shareholders are extremely concerned over the fact that StarTimes has been given control over ODMs billing methods and programming and they are worried over how ODMs own content - which it used to control - were suddenly sidelined and outsourced to China.

Then there is also grave concern over the termination of ODMs German uplink contracts which were switched to StarTimes in Beijing, and ODMs cancellation of satellite space on the SES satellite platform service which was taken over by StarTimes.

TopTV content now under foreign control

In this respect, all content being broadcast into South Africa is now under foreign control, says the shareholders.

This act by the business rescue practitioner outsources the very core of ODMs top channels which are packaged and owned by ODM. The ability to reactivate these channels will be a very lengthy process and the loss of these channels on the ODM product bouquet will certainly result in a huge loss of the subscriber base, say the shareholders.

These big changes have been done with the Independent Communications Authority of South Africa (Icasa) which has not even approved ODMs change of shareholding application with the broadcasting regulator.

Icasa is still considering and has to make a decision on ODMs request, submitted last month, requesting approval of the massive foreign shareholder change with StarTimes. In the application ODM asked for the unconditional transfer of the ENCS licence from ODM to Newco, which is in fact StarTimes Media SA.

If its not approved, and with StarTimes already in control of crucial business aspects of ODM, ODM will be essentially cut off and lose its link to its TopTV subscribers without content and satellite distribution capability.

Ownership of ODM is misrepresented

The ownership and control of ODM is misrepresented in the Icasa application in order to circumvent the criteria for holding and transferring an individual Broadcasting Service Licence and an ENCS licence, the shareholders say.

In my extensive experience as previous CEO of ODM, and from my long experience in the industry, it is clear that once a subscriber is lost, it is very costly and difficult to win that subscriber back, says Vino Govender.

Unhappy subscribers who have cancelled their contracts and moved to ODMs competitors often do not return despite massive marketing attempts.

http://www.channel24.co.za

LINK:	http://www.filmcontact.com/africa/south-africa/toptv-rocked-urgent-cou...
	See more stories from filmcontact

Most recent headlines