Government takes digital distribution platform Signet from KBC

NAIROBI: The Kenya Broadcasting Corporation (KBC) has been directed by the Government to hand over to the Treasury all its shares in the new digital distribution subsidiary, Signet.

The directive was revealed by KBC managers when they appeared before the Parliamentary Committee on Energy and Communication at Continental House yesterday.

The corporation owns 99 per cent of Signet, one of the companies fully licensed to carry out broadcasting signal distribution, under the new digital platform. The Treasury owned one per cent.

But it is the manner in which the directive has been issued and received that raised questions among members of the committee chaired by Kigumo MP Jamleck Kamau.

The directive was made in an unsigned letter purported to have come from the Treasury to the Attorney General and copied to the KBC management.

The letter received by the KBC management on Monday was produced before the House committee by Managing Director Waithaka Waihenya.

The MD had appeared before the committee together with the corporation’s chairman Edward Musebe for questioning on the intended KBC restructuring and the digital migration process.

WAY FORWARD

Waihenya said upon receiving the letter, the KBC board held a meeting on Monday to deliberate on the way forward.

He explained that the withdrawal of signal distribution from the hands of KBC would be a devastating financial blow.

Waihenya said KBC earns Sh14 million monthly from co-sharing sites with other media houses.

Signet makes about 10 million monthly from its 17 digital signal distribution sites. Currently, Signet is carrying 38 broadcasters.

“That revenue stream would go if the signal distribution is taken away,” Waihenya told the MPs.

The MD said KBC would require to be offered an equal playing field if the licence was withdrawn.

If the signal distribution was transferred to another entity, KBC would now be required to pay the distributor and this would be additional expenditure.

Waihenya said other media houses now had their own digital platforms and KBC would be left without its own signal distribution channel. The security of the corporation content distribution would have to be guaranteed, he added.

Amidst a barrage of probing questions from the MPs, the KBC managers said there was no mention by the Treasury of any consideration or compensation for the investments that KBC had made in Signet.

“There was no consideration given as of yesterday when the communication was given,” the KBC chairman said.

The KBC bosses said they were waiting for the AG’s advice on the ownership and transfer of the shares.

If the ownership transfer is effected, the signal distribution would be in full hands of the Government.

The leading private media houses have been totally opposed to being carried by a government entity.