1. Parliamentary Portfolio Committee on Communications
Presentation to
Parliamentary Portfolio Committee on Communications
03 June 2003

2. Chairman’s Introduction (1 of 4) SABC Presentation to PPC 3 June 03
Thank you to outgoing Chairperson and welcome to interim Chair
Constructive relationship between SABC and Parliament
Board is in it’s final year and important that it looks back on what it was mandated to do and what it has achieved
Pleased that we can demonstrate progress not withstanding the challenges we faced and continue to face in transformation
Transformation is a process not an event
SABC Presentation to PPC 3 June 03 2

3. Chairman’s Introduction (2 of 4) SABC Presentation to PPC 3 June 03
Able to draw on the previous Boards’ work and what has been established in our efforts e.g.
To stabilise the organisation
Improve management capacity and staff relations
Improve stakeholder relations
Set institution on a path of progress and excellence
Diversity and unity of the current Board has been a major asset in supporting the transformation of the public broadcaster
The Board focused its efforts in a number of areas:
Management
Staff
Content
Financial
SABC Presentation to PPC 3 June 03 3

4. Chairman’s Introduction (3 of 4) SABC Presentation to PPC 3 June 03
SABC steadily moving in area of strategic content excellence
Reflection of our efforts is the number (>200) of national and international awards the SABC has received
Financially, we are in the position where, for the first time, there is a firm grip on the numbers and on the challenges and important choices around funding flowing there from
Strong, diverse and competent management team in place
Draft editorial policies completed
Worked hard and deepened democracy in a way that no one else has since the debates on the Constitution
Attempting to get it right the first time but recognise we will succeed over time and not necessarily immediately
It’s important that Parliament supports the SABC in this regard
Final decision on the policies will rest with the Board of the SABC
SABC Presentation to PPC 3 June 03 4

5. Chairman’s Introduction (4 of 4) SABC Presentation to PPC 3 June 03
Process of Amending the Broadcasting Act has been concluded successfully
Reading of the Amendment Acts indicate complex tasks facing the Corporation and the new demands and challenges increase complexity
Competition for limited resources and therefore important choices must be made going forward
The SABC must implement the Amendment Act in a measured way
SABC Presentation to PPC 3 June 03 5

6. Policies Background (1 of 2) SABC Presentation to PPC 3 June 03
On 25 April SABC published a number of draft editorial policies for public comment, focusing on policies mentioned in the Broadcasting Act:
Mandate
News
Programming
Language
Universal service and Access
Local content
Religion
Education
The policies explain the SABC’s approach to different areas of its performance and what can be expected from the public broadcaster
SABC Presentation to PPC 3 June 03 6

7. Policies Background (2 of 2) SABC Presentation to PPC 3 June 03
These policies will help to redefine and establish best practice in public broadcasting and broadcasting in general in South Africa
Moreover, the policies when implemented will provide a number of things, including:
A guide to editorial staff in their daily decision making
A guide to the public on what they can expect from the public broadcaster
The scope of the policies includes:
All SABC content, whether produced by SABC or not
They contain reporting requirements to Board to allow for effective implementation
SABC Presentation to PPC 3 June 03 7

8. SABC Presentation to PPC 3 June 03
Policies Publicising
A key challenge is to make the policies widely accessible and easily understood
In this regard the SABC has undertook the following:
Policies launched to key stakeholders and press on 25 April
Copies of draft policies made available in 6 official languages
Copies available at all SABC regional offices and on SABC website
Detailed, easy to read summaries in six official languages at SABC offices and over 1000 post offices countrywide
Poster campaign in post offices
Promos on SABC radio stations and TV channels
SABC talk shows and discussion programmes used to promote discussion on the policies
Newspaper adverts published summarising the policies
Public meetings to discuss the policies to be held in each province
SABC Presentation to PPC 3 June 03 8

9. SABC Presentation to PPC 3 June 03
Policies Way Forward
We have had a good response to date - approximately 300 written responses already received
Written responses will be taken until 13 June
Thereafter:
Submissions will be collated
Meetings will be held with interest groups making proposals
Board will finalise policies
The Board expects to finalise the policies by end of 2003
SABC Presentation to PPC 3 June 03 9

10. Chief Executive’s Introduction SABC Presentation to PPC 3 June 03
The SABC is successfully making the transition to a stable public broadcaster
Major challenges lie ahead
Management
People
Product
Technology
Significant work has gone into process of stabilising the broadcaster; the stabilisation is at an advanced stage
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11. Chief Executive’s Introduction SABC Presentation to PPC 03 June 03
Notable achievements and progress relative to objectives set in our Corporate Plan
Developing and implementing strategies to ensure compliance with the Act and long-term success and viability
Going forward continued focus on delivery
Tough and challenging year ahead
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12. Chief Executive’s Introduction Progress
During the fiscal our action has led to a number of notable achievements in relation to our key performance areas
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13. SABC Presentation to PPC 03 June 03
Highlights (1 of 4)
Amendment Bill passed in Parliament
Shareholder Compact Completed
Un-picked Bi-media
Rebuilt the sales and marketing team
Reviewed Commissioning Procedures
Content Hub strategy developed
Rebuilding PBS radio
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14. SABC Presentation to PPC 03 June 03
Highlights (2 of 4)
Industry development
Highway Africa
African Writers’ Lab for Radio and TV
SABC Internship Program with Kentron College
Revising Commissioning Procedures
BEE & SMME Development
Actual spend and support via broadcasting services
Launch of News bulletins in SiSwati and IsiNdebele and new current affairs programmes
Rural Development & urban regeneration
Relocation of Ikwekwezi
Integrating CKI into PBS portfolio and developing reinvestment strategy
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15. SABC Presentation to PPC 03 June 03
Highlights (3 of 4)
Coverage of sport of national Interest, development and minority sport
Heritage and African Culture
Tobias Bodies
Values in Education
Looking Back Moving Forward
Let’s Meet
Remember the Day
Sarah Baartman
News and Current Affairs from and for the Continent
WSSD
W.E.F’s Southern African Economic Summit
Promotion of Public Health
SABC Presentation to PPC 03 June 03 15

16. SABC Presentation to PPC 03 June 03
Highlights (4 of 4)
Finance
Financial policies finalised
Internal audit co-sourced
Financial model complete
Financial realignment project well underway
Policy
Language workshop
Architecture in place for aligning and rebuilding Corporation’s brands HR
Performance management system
Change management underway
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17. SABC Presentation to PPC 3 June 03
Focus Moving Forward
Content:
Deliver the best content to fulfil our mandate in the most cost effective way to maximize audiences and revenues
People
Attract, develop and retain the best creative and other talent
Technology
To put in place the appropriate technology infrastructure to deliver on our objectives
Finance
To ensure effective and efficient utilisation of resources and to put in place world class systems and processes
Corporate Reputation
To be the most admired media brand and brands in South Africa
SABC Presentation to PPC 3 June 03 17

18. Specific Delivery Areas (Corporate 1 of 2)
Submit Licence Applications
Regional TV services
Amendments to existing radio and TV services
Finalise Corporatisation
Resolve Bop loan and assets
Develop strategy for Channel Africa
Implementation of EVA
Reduction of overheads and investment in non-productive assets
SABC Presentation to PPC 03 June 03 18

19. Specific Delivery Areas (Corporate 2 of 2)
Content Hub implementation
Develop & implement Corporate Reputation Strategy
Expand strategic relationships e.g. Sentech & international broadcasters
Preparation for Election Coverage
Realign organisational structure to suit new legislative requirements and ensure operational effectiveness
Media and Society Workshop
SABC Presentation to PPC 03 June 03 19

20. Chief Executive’s Introduction Trade Offs
Going forward it is also clear that there are a number of competing interests and therefore difficult choices must be made
Sport of national interest
Capital budgets required for levels of convergence
Regional services
Funding mix & new revenue sources
Competition (Convergence Bill)
Need to implement current obligations before attempting to institute additional change (e.g. Public Broadcasting Conference)
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21. SABC Presentation to PPC 3 June 03
Programming: News
SABC Presentation to PPC 3 June 03 21

22. News Programming Chairperson Introduction
The public broadcaster’s news product plays a critical role in keeping the nation informed and encouraging debate
Clear improvements in quality and delivery
A number of scheduling and other changes have been implemented as part of a systematic action plan to make news and current affairs more accessible to the public
The current focus is on the content strategy and includes discussion on linking news events of the day with national objectives and values
SABC Presentation to PPC 3 June 03 22

23. News Programming Chairperson Scheduling and Programming
New current affairs programme launches:
Asikhulume on SABC 1
Current affairs program on X!K FM
Interface - current affairs programme on SABC 3
Consumer Talk – daily consumer/current affairs show on SABC 3
Business Update & Business Focus on SABC 3
Rescheduled programmes
Siswati/IsiNdebele news bulletins
SeSotho/SeTswana news bulletin from 21h00 to 20h30
English news bulletin from 20h00 to 19h00
SABC Presentation to PPC 3 June 03 23

24. News Programming Chairperson Telling the Rural Story
ALS news and current affairs shows regularly visit remote villages in rural areas for special broadcasts related to community, cultural and socio-economic issues
Examples of these outside broadcasts include:
Lesedi: Matatiele in the E. Cape focusing on poor service delivery in the province, using case studies from Matatiele, Mount Fletcher and surrounding areas
Ligwalagwala: broadcast team sent to Driekoppies to look at the way the local community fights crime after several suspects were punished by a vigilante group
SABC Presentation to PPC 3 June 03 24

25. News Programming Chairperson Highlights
In addition, our news and current affairs team have continued to bring events of national and international significance to our nation and the World
Walter Sisulu Funeral
Signing of the Congo Peace Accords
War on Iraq (done from a South African Perspective)
WSSD
A number of awards and accolades have been received for SABC News coverage including:
Media Tenor Award for SABC 1 Nguni bulletin
Accolades for professional and efficient coverage of WSSD
CNN African Journalist of the Year Award in the Radio News Category
Vodacom Award Specialist Category for Radio News
ATKV Radio Award
SABC Presentation to PPC 3 June 03 25

26. News Programming Chairperson Way Forward
Further scheduling and programming changes include:
News bulletin in tshiVenda and xiTsonga from July (SABC 2)
Changes in the PBS Radio to increase news and current affairs broadcast on radio (e.g. SAFM, Lesedi)
A major conference planned Media & Society
to be held this year with stakeholders, including religious leaders, political parties, government, cultural organisations, women’s bodies and youth organisations
Will debate key issues of global relevance
SABC Presentation to PPC 3 June 03 26

27. Programming: Radio & TV
   
                       
                                                                                     
                           
                              

28. Programming Chairperson: TV & Radio Introduction (1 of 2)
Significant work has gone into reviewing the SABC’s commissioning and acquisition procedures
We have looked at how the Corporation spends more than three quarter of a billion rands on content both locally and internationally
All key industry stakeholders consulted, and implementation of changes is planned in the current fiscal
Editorial line that informs our approach to content has been drafted and is in the public domain for comment
A number of key stakeholder interactions (e.g. Language Workshop), the Constitution, as well as the policies of other public broadcasters have informed our draft editorial policies
SABC Presentation to PPC 3 June 03 28

29. Programming Chairperson: TV & Radio Introduction (2 of 2)
The strategies to reposition our channels and radio stations are being implemented
Over the course of the year the national broadcaster has improved in its delivery, particularly in the area of TV local content
A key focus over the coming year will be the implementation of the Content Hub
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30. SABC Presentation to PPC 3 June 03
Programming Chairperson: TV & Radio Highlights: Television Local Content
Delivery of local content has increased on all channels.
Note: *Year to 28 Feb 2003
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31. Programming Chairperson: TV & Radio Highlights: Radio Local Content
The SABC has continued to exceed local content quotas on both PBS and CBS Radio.
Note: CBS excludes BOP and Sunshine; Annual Average across all stations in portfolio
Source: SABC Management Info.
SABC Presentation to PPC 3 June 03 31

32. Programming Chairperson: TV & Radio TV: Language
The SABC remains committed to providing programming in all official languages.
Content in non-English languages on television has increased over the past 4 years in Nguni, Sotho and Afrikaans
Increase in language is an ongoing process, and a key objective for the current fiscal is to increase language delivery, both overall and in minority languages
Strategies are currently in place to ensure delivery
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Note: * from FY99/00 to 02/03 – Nguni 14.31% to 14.8%; Sotho 10.6% to 15%; Afrikaans 22.58% to 31.1%

33. Programming Chairperson: TV & Radio PBS Radio Strategy
Reinvesting in Radio
Assist the portfolio to realise their full broadcasting potential
Initial recommendations on all 13 PBS stations completed
Interventions into programming and scheduling strategies already underway
Recruitment of programming managers currently in progress
Training programmes for staff being conducted in tandem with development and implementation of strategy
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34. SABC Presentation to PPC 3 June 03HR
SABC Presentation to PPC 3 June 03 35

35. HR Chairperson Overview (1 of 2)
The key pillar supporting our success is our people and our culture
Board found many very talented people with creative and technical competencies;
Environment not ideal to fully tap into their creative/positive energies
The last year has seen a focus on performance and change management
EVA
Development of operating principles
Overhaul of performance management system
Focus is on rewarding excellence, remunerating competitively and improving and changing the culture
Ensure long-term sustainability and relevance
SABC Presentation to PPC 3 June 03 36

36. HR Chairperson Overview (2 of 2)
To support our objectives a new performance management system/approach has been developed
Our performance management approach seeks to drive performance in five key areas
Growth and Financial Health
National Priorities and Mandate
Innovation and Customer
Operations and Process
People and Success Behaviours
System being implemented in the organisation to improve what we do and how we work together to achieve common objectives and drive excellence
SABC Presentation to PPC 3 June 03 37

37. Finance & Audit Committee Chairperson (1 of 2)
The SABC remains in a sound financial state with sufficient cash resources to meet the current commitments
The rate of cost increases continue to outpace the rate of revenue growth
The value of TV licences declined by 35% in real terms. This has significantly impacted the financial performance of the Corporation
The need of new services, ageing infrastructure and the demands of digital technologies will challenge the financial capacity of the Corporation over the coming years. Shareholder support will be required to implement these strategies
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38. Finance & Audit Committee Chairperson (2 of 2)
The focus on enhancing financial controls and information needs of the Corporation received further momentum as the financial realignment controls were implemented
Going forward, the key priorities remain
Sound financial management
Expanding and enhancing business and financial controls
Securing the funding required by the Corporation to implement the technology and content plans
Finalising the incorporation of the SABC under the Broadcasting Act
SABC Presentation to PPC 3 June 03 39

39. Environmental Factors SABC Presentation to PPC 3 June 03
TV Licence Fee Growth
If TV Licence fees were increased in line with CPIX inflation since 1998, the rate would be R71 higher today than it is currently.
Nominal CAGR ( )
Real CAGR ( )
300
279
252
236
221
7.6%
208
Actual Tariff = R208
-7.3%
CPIX Deflator:
86.8
92.8
100
106.6
117.3
125
Source: Statistics SA CPIX (annual average) deflator series; 2003 CPIX proj (BMR)
Note: Rounding errors may occur
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40. Environmental Factors SA Advertising Revenues (98-02)
Local our advertising market has faired better than the international market; however, our most significant revenue driver, TV, is growing slower than the overall market.
CAGR
(98-02)
R6.9bn
R7.6bn
R8.3bn
R8.8bn
R8.2bn
8.5%
206.8%*
-6.1%
-3.0%
25.5%
14.6%
6.9%
Note: * - CAGR
Source: AC Nielsen Ad Index
SABC Presentation to PPC 3 June 03 41

41. Growth in offerings continues to put pressure on audiences and revenue42

42. Environmental Factors SABC Costs Mix.
Key Drivers
Personnel
Programming
Note: *Year to Dec 2002
Source:
SABC Presentation to PPC 3 June 03 43

43. Environmental Factors Content Cost Mix
60% of total content spend is directed towards local content.
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44. Conclusion (1 of 2)
Continuous debate about the role and obligations of the Public Broadcaster
SABC is one of the leading institutions at the forefront of transformation
SABC is one of the leading institutions that can promote growth in ICT sector
SABC one of the leading broadcasters that can promote democratic values on the African continent
SABC needs regulatory and legislative stability to achieve these objectives

45. SABC Presentation to PPC 3 June 03
Conclusion (2 of 2)
Over the coming months, our efforts will focus firmly on:
Fully implementing the Act
Finalising corporatisation
Structural and financial realignment
Applying for regional licences
Amendments to existing licences
Policies
Ongoing implementation of short and medium term strategies
Improving content
Improving brand recognition
The Board is committed to ensuring that the SABC continues to deliver on its public service mandate amidst the many challenges it faces
The Board will seek the support and partnership of its stakeholders to ensure that the SABC continues to improve delivery
SABC Presentation to PPC 3 June 03 46

46. THANK YOU