Publications
Partners
Johannesburg - Content classification authority the Film and Publication Board (FPB) has explained why online video services like Netflix are urged to pay a R795 000 licensing fee.
Legal teams from Netflix and the FPB are near to reaching an online distribution agreement, Fin24 reported earlier on Wednesday.
READ: FPB asks Netflix to pay R795K licensing fee
Last month, the FPB gave Netflix a two-week ultimatum to comply with SA regulation.
Subsequently, Netflix has been urged to pay R795 000 for a licensing fee that allows online distributors to “self-classify using the FPB classification guidelines after training is offered to the online distributor's content raters of films and games”.
This fee differs dramatically from FPB tariffs which range from traditional distributors of films, such as DVD rental stores, paying a R1 121 registration fee, according to a government gazette released in November 2015.
(See the FPB's full tariff listing at the end of this story.)
Communications regulatory expert at Ellipsis Regulatory Solutions, Dominic Cull, has said that while he agrees that online content providers should be licensed, he questions what benefits these distributors would get out of paying as much as R795 000.
“They (the FPB) are – in my view – attempting to get Netflix to register for a category that does not exist and subject to a fee which is out of all proportion to any benefit received,” Cull told Fin24.
Cull has also questioned why Netflix must pay a bigger licensing fee than traditional brick and mortar DVD rental shops when they both essentially offer the same service.
'Differing classification process'
But the FPB’s chief operating officer Sipho Risiba told Fin24 that while Netflix and traditional DVD rental stores provide the same service, the “business model and classification process is different”.
“For instance with respect to DVD rental store, they are required to submit physical copies of DVDs to the FPB for classification and we charge classification fee per title submitted to the FPB for classification,” Risiba told Fin24.
“On the other hand online content distributors stream voluminous amounts of content online at a go, hence there is a difference in the fees charged,” he said.
'Lack of clarity'
Responding to this comment from Risiba, Cull said that “there still seems to be a lack of clarity on exactly what content is being targeted”.
Cull also said that “logic dictates that electronic submissions should be less expensive”.
But the FPB is set to further study the fees it charges.
“There is also a study underway to look at the appropriate fees and pricing model for online and physical content classification and distribution,” Risiba told Fin24.
“Once the study is completed and first draft developed, FPB will hold public hearings and invite industry and stakeholders to make inputs and comments on the proposed fees and pricing structure,” he said.
Risiba also told Fin24 that the FPB is currently upgrading its ICT infrastructure and procuring online classification and monitoring tools to meet the demands of content distributors.
What are your thoughts on this issue? Tell us by clicking here.
