Content streaming service providers Netflix and Amazon, as well as pay TV channels iROKOtv and Africa Magic are considering stopping further investments in the Nigerian content industry, it has learned.
The four platforms, brought together exclusively, have been forced to consider disrupting investments in Nigeria due to the sixth broadcast code recently released by the National Broadcasting Commission (NBC).
Creative and broadcasting industry sources revealed that four platforms, which have invested heavily in producing local content that are exclusive to them, are convinced that the new streaming code is a major threat to their investments as it seeks to put end the exclusivity of transmission properties and compel resale or sub-licenses to other broadcasting organizations, including direct competitors.
Sources told our correspondent that the new code makes exclusivity illegal, requires sub-licensing of content, and aims to regulate the prices at which content is sub-licensed.
According to an industry source, the streaming platforms viewing Sections 9.0.1 through 9.0.3 of the streaming code represent a direct assault on investors as it erodes the ability to earn dividends on their investments.
“These sections prohibit broadcasting organizations from entering into rights acquisition agreements that do not allow the sublicense of such rights in Nigeria. The implication is that any agreement concluded is void, “he explained.
An Enugu-based industry source also reasoned that Sections 188.8.131.52 through 184.108.40.206 of the Code are more damaging to investors in the industry.
The sections stipulate that a station must sublicense a program in any genre if it enjoys a massive audience among Nigerians.
The implication of this, the source explained, is that investors, who finance the development of successful movies, series and shows, will be forced to sublicense that show regardless of whether or not they have recouped their investments.
“This is not only silly, but also perverse. It is an uncompensated use of intellectual property. The appropriate thing is for a broadcasting chain to offer, negotiate or acquire rights freely at prices dictated by the market and on terms acceptable to channel providers, ”he said.
He also explained that forced sub-licenses will inhibit investments, especially by foreigners in the content creation and dissemination industry.
“I was not surprised to learn that Netflix and Amazon are concerned. They should be concerned because they have invested heavily in acquiring Nigerian content.
“They have yet to recoup their investments, but you say they should sell to their competitors. Do you think other investors will be encouraged to come and invest? No.
“AfricaMagic has spent tons of money buying and creating local content. They are right to panic. So is Irokotv, “he said.
A former content producer explained that the broadcasting industry is already difficult terrain to operate in and that the new code has worsened. He claimed that NBC is trying to make the private company state-owned and be the one to determine the scale of dividends an investor should reap from his investment.
He argued that broadcasters will invest only if they are confident that the content on their platforms will help differentiate their offerings and they will be able to get back what they invested enough. He warned that NBC’s interference in broadcasters’ commercial freedom will discourage investment in the broadcasting industry.
This, in turn, he said, will have a negative impact on the production sector and the economy in general.