UCC raises pay TV licence to Shs95 million

Kampala. Uganda Communications Commission (UCC) has issued a new licencing regime for pay TV service providers scrapping the disputed Shs550m the regulator had imposed at the start of the year.
UCC had at the beginning of the year issued a new licencing regime, which had required new pay TV service providers to pay Shs550m annually up from Shs22m.

However, pay TV services providers rejected the proposal sparking a war of words with the regulator warning it would close pay TV service provider that would fail to fulfil the requirement.
In a statement released then pay TV service providers said the new license regime was extremely high and would impact end-user subscription rates.

The deadlock forced UCC and pay TV service providers to call for negotiations, which according to details seen by Daily Monitor has harmonised the licence at $25,000 (Shs94.8m).
“Following conclusion of the discussions with pay TV operators, UCC hereby reiterates that pay TV operators will pay an annual license fee of $25,000,” details of the new licensing regime reads in part.
Ms Sheila Nyanzi, the Kwese East Africa regional head, yesterday told Daily Monitor the new licencing regime, although revised, could impact subscription fees. The increase, however, she said, could depend on particular operators.

“The only logical consequence is when cost of business goes up, prices go up. But since it has not changed for many years, people should be willing to pay more whether it is the subscribers or investors,” she said, adding some pay TV service providers might subsidise the cost while other will be left with no choice but to increase.
Mr Godfrey Mutabazi, the UCC executive director, yesterday said the reforms were a culmination of several meetings that sought to realign licencing regime to the Communications Act 2013 that ushered Uganda into the digital broadcasting regime.
Uganda fully migrated to digital broadcasting in 2015, two years after the international deadline.

The new licencing regime will also require pay TV service providers to submit audited books of account, which shall form the basis of the annual licence fees for already existing pay TV providers.
The fee will be instituted at 0.65 per cent calculated against the gross income derived from the composite operations of the licensee.
All pay TV service providers will also be required to carry a minimum of 20 per cent of local content, failure of which they will be required to contribute an amount, determined by UCC, to the Content Development Fund for the regulator to develop such content.

Requirements of Licensing regime

Agreements between pay TV and UCC
UCC agreed with the submission by pay TV operators that operators without physical infrastructure in Uganda shall not be required to obtain public infrastructure provider licenses.
Only operators providing services through Terrestrial, Cable and other transmission infrastructure shall be required to obtain PIP licenses.
All broadcasters providing services to final consumers shall be required to obtain a Public Service Provider (PSP) License.
Self-provisioning operators, with multiplexing technology shall be required to obtain a PIP and PSP license.

PIP licenses shall be for a period of 15 years, renewable upon satisfactory performance of the license terms and conditions.
PSP licenses shall be for a period of 5 years, renewable upon satisfactory performance of the license terms and conditions.
Existing pay TV operators shall not be required to pay initial entry fees for any of the licenses applied for.

Pay TV operators shall pay an annual license fee of $25,000 or 0.65 per cent of the operator’s Gross Annual Revenue. Every pay TV operator shall be required to submit audited books in accordance with the reporting requirements.
The 0.65 per cent annual license fees shall be calculated on the gross income derived from the composite operations of the licensee.
Pay TV operators shall carry a minimum of 20 per cent local content on their broadcast platforms.

Where, for whatever reason, a pay Tv operator fails to meet the 20 per cent local content threshold, the Commission shall determine the amount of monetary contribution to be made by the respective operators towards the Content Development Fund. The sum payable shall be determined depending on the extent of non-compliance by the operator.

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