Nigeria Plans Audience Measurement Conference To Catalyze Broadcast Industry Growth

Subject: Speech By The Hon. Minister of Information and Culture, Alhaji Lai Mohammed, At BON’s 3rd International Summit on Digital Broadcasting in Nigeria in Lagos on Tuesday, 22nd August 2017

PROTOCOL

Permit me to congratulate the Broadcasting Organization of Nigeria
(BON) for holding this summit, the 3rd in the series, on digital
broadcasting in Nigeria. The theme of the summit: The Future of
Nigeria’s Digital Broadcasting Ecosystem: Technology, Content,
Platforms and Devices, is particularly apt, as we rev up the process
of our transition from analogue to digital broadcasting.

2.   I can tell this gathering that the Digital Switch Over (DSO) of
our television from analogue to digital is now well underway. Since
the launch of the pilot scheme of the Digital Switch Over (DSO) in Jos
in April 2016, we have rolled out in the Federal Capital Territory. We
are now ready to take the DSO to all the country’s six geo-political
zones. We are anxious to keep the momentum, and the National
Broadcasting Commission (NBC) and all its partners have their hands on
deck to cover the country at the soonest possible time.

3.   Today, I want to speak on an issue that will make our DSO
sustainable for Signal Distributors, Channel owners, TV Content
Producers and Advertisers. This is the issue of Audience Measurement.
Without it, we will not see the much-needed growth in our television
and or the value creation in the Creative Industry. We need an
objective and scientific Audience Measurement System that articulates
the value of the content to Consumers, as well as the value of the
Audience to Advertisers, particularly in the Television sector.

4.   The lack of a scientific Audience Measurement System has resulted
in under-investment in the sector, which is necessary to foster the
growth of the industry, as the Advertising community continues to rely
on subjective factors when making decisions on the Content they want,
as opposed to how many viewers the Content truly attracts.

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5.   This factor also contributes to the less-than-optimal investment
by all key stakeholders in the Television broadcasting value-chain,
that is; the Broadcasting Organisations of Nigeria (BON) members, the
Media Independent Practitioners Association of Nigeria (MIPAN) and the
Advertisers Association of Nigeria (ADVAN), as well as the problem of
delayed payments for media placements across the value-chain.

6.   As a consequence, Television platforms are subjected to renting
out space on their Channels to sustain their businesses and Content
Producers have become increasingly over-reliant on sponsorship which,
unfortunately, skews the authenticity of their creative output in
favor of a few decision makers and not the millions of TV viewers.

7.   The existing model will never enable the Nigeria’s Creative and
Entertainment Industry to reach its full potential. It stunts the
quality of the Content that can be created and it also limits the
capacity of Television platforms to invest in dynamic offerings that
Consumers will be attracted to.

8.   Further, the value of Nigeria’s Broadcasting Advertising Market
is not proportionate with its population when compared to the Top 3
Markets in the Sub-Saharan Africa region. Despite having a population
three times more than South Africa, Nigeria’s Television Advertising
Revenue in 2016, at US$309m, was 76% behind that of South Africa, at
US$1,301m.

9.   By 2020, the gap between South Africa and Nigeria is projected to
marginally decline to 72%. Similarly, in the Radio sector, the value
of Nigeria’s 2016 Advertising Revenue of US$81m was 75% behind its
peers, South Africa and Kenya, both at US$343m. Kenya is projected to
overtake South Africa in 2017 as the leading Radio Advertising market.

10.   In both territories, the value and growth rate of the
Broadcasting Advertising Revenue is largely influenced by the
availability of a scientific Audience Measurement System that provides
confidence to Advertisers in measuring their Return-On-Investment.

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11.   It is imperative that we urgently put in place an Industry
Framework that will ensure that Content Producers receive their just
due for the value of the Content they create, as well as provide
objective guarantees to the Advertising community on their
Return-On-Investment on media placements. This will then have the
overall effect of guaranteeing greater spending by the Advertisers,
who are all seeking to grow their market share.

12.   This Industry Framework can only happen if the Ministry of
Information and Culture, which fortunately supervises both the
Broadcasting and Advertising industries, serves as a catalyst for
putting in place a robust Audience Measurement System that is in line
with global standards and supports the realization of the immense
potential that the Nigerian Creative and Entertainment industry holds.

13.   The Federal Government has already taken a critical long-term
decision to support the Nigeria Creative and Entertainment Industry by
ensuring and funding the inclusion of a middle-ware that is capable of
scientific Audience Measurement on FREETV DTT Set-Top Boxes.

14.   The current Diary Audience Measurement system, whilst it has
served the industry well for over a decade, is not ideal for the
critical transitional phase before full DTT Migration for the
following reasons:

–      Recall is not the most scientific method of measuring Viewership

–      The One-Month lag in reporting is not ideal for Programming and
Advertising planning

–      Panel is not easily adaptable to the ever-changing population
demographics

15.   Currently, government is also subsidizing the Signal
Distribution because the Channels cannot pay for the carriage of their
channels by the licensed signal distributors who have invested in
equipment and transmission. Things cannot continue like this and the
economics of the Channel owners has to change.

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16.   During this transitional period, the Broadcasting Industry needs
an Audience Measurement system that will encourage investment in the
Broadcasting Industry, mainly through increased Advertising spending
driven by confidence in the Audience Ratings data, and one that the
incremental Advertising Revenue will encourage incumbent and
prospective Channel owners to create additional Television Channels
necessary to drive DTT uptake by the over 24 million TV households.
Since we cannot subsidize all the homes, the content on FreeTV must be
so compelling that people will be willing to buy the boxes in order to
get access to the rich in content and free offerings.

17.   Therefore, a medium-term solution is imperative to spur the
industry to make investment in Content and New TV Channels that are
necessary to drive the uptake of DTT. Considering the above, the
Ministry of Information and Culture
is ready to take the important first step by organizing an Audience
Measurement Conference in Lagos on Tuesday, Oct. 3rd 2017, so that
stakeholders can contribute to efforts to come up with a scientific
Audience Measurement System.

18.   Bringing Nigerian TV advertisement market into line with
benchmarks that is 2 to 3 times the current size could result in
additional $200-$400m of revenue to the industry, based on current
comparisons with other African countries. This is our next task and we
invite all well meaning practitioners of this industry to join hands
with us to achieve this.

19.   It is now my pleasure to declare open the 3rd International
Summit on Digital Broadcasting in Nigeria. I wish you all fruitful
deliberations and I thank you for your kind attention.

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