Digital Migration Process in Kenya

Transcription

1 Digital Migratio Process i Keya Jauary 2017 Report writte by Telecommuicatios Maagemet Group, Ic Copyright 2017 GSMA

2 Best Digital practice Migratio i mobile Process spectrum i Keyalicesig 9

3 Digital Migratio Process i Keya 4 1 Cotets Executive Summary 4 1 Key Characteristics of the Digital Migratio Process i Keya Backgroud Keya s Implemetatio of the GE06 Agreemet Stakeholders i the Digital Migratio Process Roadmap Digital Migratio Framework Policy ad Regulatio Legal Implemetatio of the Iteratioal Digital Migratio Obligatios Regulatory Authorities Legal Authority Regulatory Framework for Broadcastig Services Digital Migratio Pla Plaig Implemetatio Digital Broadcastig Chael Pla Traiig for Digital Broadcastig Systems Cosumer Awareess Use of the Digital Divided for Mobile Broadbad 22 2 Mai Challeges ad Solutios Availability ad Affordability of Set-top Boxes Availability of Set-Top Boxes ad Stadard Chage Affordability of Set-Top Boxes Fudig Challeges Network Ifrastructure Additioal Expeses Legal Challeges Challege before the PPARB Cosumer Federatio of Keya ijuctio Broadcasters lawsuit 27

4 Digital Migratio Process i Keya Keya i the Regioal Cotext Actio Committees Public Awareess Campaigs Set-Top Boxes Litigatio Fudig Summary 33 4 Coclusios Lessos Leared ad Results Achieved Checklist for Coutries Udertakig a Digital Migratio Process 35 Appedix A: List of Acroyms 40 Appedix B: Status of GE06 Coutries 42 Appedix C: Techical Cosideratios of Keya s Digital Migratio 44

5 Digital Migratio Process i Keya 93

6 Digital Migratio Process i Keya 4 Executive Summary This report presets a case study of the digital televisio migratio i Keya. As oe of the largest ad most diverse ecoomies i East Africa, Keya is a hub for techology ad iovatio i the regio. Keya s experiece with the digital televisio migratio, icludig the key challeges faced ad the solutios implemeted, highlight valuable lessos that ca provide useful iformatio ad guidace to regulators ad policymakers from other coutries where similar migratio processes are ogoig or beig plaed. Plaig for the aalogue to digital televisio migratio i Keya bega i The govermet viewed the migratio as a vehicle to ot oly deliver improved audio-visual quality ad diversity of cotet to Keya cosumers, but also to efficietly utilise spectrum, resultig i a digital divided (freed up spectrum). Compoudig the migratio s beefits, this digital divided would later be used to support ew mobile services, icludig 4G, brigig sigificat beefits to Keya citizes. Lessos I Keya, as i other coutries, the digital migratio process required cosideratio ad implemetatio of a broad rage of topics icludig policy cosideratios, the state of the broadcastig market, fudig, public outreach, cosumer equipmet ad the iclusio of stakeholders i the plaig process. The followig are some key lessos from Keya s migratio experiece: Govermets must play a critical role i facilitatig the etire digital migratio process by establishig a wellplaed migratio roadmap ad obtaiig buy-i from stakeholders, as these tasks greatly icrease the chace of a smooth ad successful trasitio process. Govermets should request ad give due cosideratio to idustry iput throughout the migratio process, icludig durig the plaig that precedes the actual techical chages. Due cosideratio of these iputs ad well-reasoed decisios will promote buy-i from stakeholders, which reduces or elimiates court challeges. I developig timelies for the process, all stakeholders should uderstad that adjustmets will likely be ecessary to address challeges ad uaticipated developmets. At the same time, multiple timelie adjustmets may create cofusio ad lack of certaity amog cosumers about the digital migratio process. Such adjustmets should be implemeted oly whe objectively ecessary ad whe their beefits outweigh the icreased ucertaity. Whe choosig techical stadards, it is importat to seek iteratioal harmoisatio i order to beefit from ecoomies of scale. O the cosumer side, the provisio of set-top boxes (STBs) is key, icludig its affordability ad availability. For both the etwork ad cosumer perspectives, proper cosideratio should be give to the digital televisio deploymet capacity i differet regios of the coutry. Optig to use a wholesale model for broadcast distributio may be a useful tool to allow broadcasters to focus o cotet ad ease the costs of ifrastructure ad other fiacial requiremets, but relyig solely o a govermet-owed etity to provide such services may limit roll-out due to fudig costraits ad geerate cocers about cotet cotrol from private broadcasters.

7 Executive Summary 5 Whe implemetig a wholesale model for distributio services, the govermet should establish a licesig framework that allows the private sector to obtai distributio service liceces, thereby providig greater flexibility ad ecouragig ivestmet i the sector. I developig cosumer awareess campaigs, govermets should provide icetives to esure cooperatio from media outlets ad should be prepared to combat misiformatio to cosumers. Emphasis should be placed o media outlets with the greatest reach, which may iclude more traditioal chaels, such as radio. process the govermet will use to grat the spectrum to ew operators. Trasparecy regardig the process will greatly ehace the credibility of the sector ad allow for proper plaig by iterested participats. Adaptig lessos leared from Keya s experiece, Figure 1 summarises key cosideratios regardig policy ad regulatio, techical decisios, cosumer awareess ad spectrum plaig that govermets should cosider whe udertakig a digital migratio process. The migratio pla should iclude details regardig the repurposig of the digital divided spectrum, icludig specific timelies for clearig the bad ad awardig the spectrum. I additio, the pla should specify the FIGURE 1: KEY POINTS FOR THE DIGITAL MIGRATION PROCESS Policy ad Regulatio Techical Cosumer Spectrum Repurpose Brig together key stakeholders Defie resposibilities ad set goals Establish legal framework for flexible regulatio Develop appropriate policies Defie miimum set-top box specificatios Cosider harmoisatio Determie stadards Pla ad defie the switch-off Accout for the deploymet capacity of differet regios Educate the public about the beefits of digital migratio Establish fudig mechaisms Esure citizes ca afford STBs Clear recetly freed up spectrum Repurpose for ew services, icludig mobile broadbad Defie bad pla i accordace with regioal ad iteratioal stadards Source: TMG aalysis.

8 Digital Migratio Process i Keya 6 Process As a sigatory to the ITU Geeva 2006 (GE06) Agreemet, the Keya govermet origially agreed to a aalogue switch-off (ASO) date of 17 Jue But durig the plaig process, it opted for a more ambitious schedule, advacig the switch-off date by three years ad settig a deadlie of Jue See Figure 2 for the overall timelie of the digital migratio process. FIGURE 2: OVERALL TIMELINE OF KENYA S DIGITAL MIGRATION PROCESS ICT Sector Policy Guidelies Task Force Report BSD licesig deadlie Phased-i ASO approach adopted March 2006 March 2007 October 2007 December 2007 August 2008 November Jue 2015 Creatio of Migratio Task Force DTC created Simulcast begis Process completed before GE06 deadlie Source: TMG research. To pla the digital migratio process, the govermet created a multi-stakeholder Digital Migratio Task Force that advised the Miister for Iformatio, Commuicatios ad Techology (MICT) ad developed a report that provided the roadmap for the migratio process. The report recommeded: establishig the Digital Trasitio Committee (DTC) to maage the migratio process; implemetig a phased ASO durig the migratio process; licesig broadcast sigal distributors (BSDs) to provide sigal distributio services separately from cotet licesig; implemetig a dual illumiatio (simulcast) period of three years from 2009 to 2012 durig which aalogue ad digital televisio would be simultaeously broadcast; ad iitiatig the ASO from 1st July 2012 i a phased maer. Pursuat to the report, the MICT created the DTC, chaired by the Pricipal Secretary of the MICT, to maage ad implemet the roadmap. The DTC was comprised of the Commuicatios Commissio of Keya (CCK), which subsequetly became the Commuicatios Authority of Keya (CA), the MICT, broadcasters, set-top box (STB) vedors ad cosumer associatios. To complemet the DTC s work ad facilitate the deploymet of the digital ifrastructure ad geerate greater cotet, as recommeded i the report, the CCK developed a ew broadcastig licesig framework that ubudled cotet from distributio ad created two categories of liceces cotet liceces ad BSD liceces. The govermet viewed the ew ubudled licesig framework as a meas to reduce market etry barriers ad operatig costs for broadcasters because they would o loger eed to deploy ad operate expesive etworks, such as televisio trasmitters ad associated ifrastructure, or acquire spectrum. Keya was ot aloe i usig this approach. Other coutries i the regio, icludig Rwada, South Africa, Tazaia ad Ugada also opted to ubudle cotet from distributio. Iitially, Keya awarded oly oe BSD licece to SIGNET, a ewly created subsidiary of the public broadcaster, KBC. After rollout was delayed ad fudig was isufficiet, the govermet opeed a competitive teder process ad awarded a secod licece to Pa Africa Network Group (PANG), a private Chieseowed etity. I additio to amedig the licesig framework, the govermet sought to raise awareess ad educate the public o the migratio process. As part of this effort, CA ad DTC coducted a wide rage of media campaigs, icludig televisio ad radio commercials, prit advertisemets, billboards ad social media iitiatives through Facebook ad Twitter accouts. The authorities also held several roadshows, mobile cliics ad other outreach activities to better egage cosumers icludig cosultatio forums, ad iterviews.

9 Executive Summary 7 Challeges Similar to other coutries, Keya s digital migratio process faced umerous legal, techical, fudig ad cosumer challeges (see Table 1). These challeges required sigificat resources ad resulted i disruptios ad delays. TABLE 1: KENYA DIGITAL MIGRATION - CHALLENGES AND SOLUTIONS Challeges Issue Solutio Legal Litigatio brought by broadcasters seekig redress from ot beig allowed to obtai BSD liceces. This litigatio prompted delays i ASO timelies. 1. Chaged to a phased ASO. 2. Iitiated a licesig process to allow a private sector etity to be awarded a BSD licece. 3 years (Jue April 2014) Techical 1. Limited availability of STBs. 2. Affordability of STBs. 1. Established miimum STBs specificatios, fast tracked vedor authorisatio. 2. Removed import duty ad reduced type approval fees. 1 year ( govermet fiscal year) 1. Decisio to switch from DVB-T to DVB-T2 to take advatage of ew stadard. 2. Chage i stadard created misiformatio about existig DVB-T ifrastructure ad STBs 1. Deployed a parallel DVB-T2 etwork i Nairobi. 2. Established miimum STB specificatios ad delayed ASO to build up ivetory. 7 moths (Jue December 2012) Fudig Delayed digital BSD etwork rollout due to legal ucertaity ad iadequate fudig. Awarded additioal BSD licece to PANG, a private sector compay to assist with rollout. 4 years (Jue Jue 2015) Cosumer Lack of public awareess cocerig the migratio. Demostrated beefits of digital migratio through cosumer awareess campaigs, usig social media, prit ad TV/radio, ad creatio of a specific website cotaiig DTV iformatio Ogoig process ( preset) Legal challeges. The legal challeges, which took several years to resolve, were based primarily o the ew broadcastig licesig framework. With oly SIGNET ad PANG as BSD licesees, broadcasters felt ufairly excluded from the sigal distributio market ad challeged the BSD licesig process i court. Ultimately, the Supreme Court determied that while the migratio process was legal, the broadcasters were etitled to obtai BSD liceces. CA decided to grat the broadcasters selfprovisioig BSD liceces. These liceces are more limited tha stadard BSDs liceces as the licesees ca oly trasmit their ow cotet over their ifrastructure, ot that of third parties. I 2015, the first self-provisioig licece was issued to Africa Digital Network (ADN), a cosortium of the Natio Media Group, Stadard Group ad Royal Media Services. SIGNET ad PANG cotiue to hold stadard BSD liceces. Techical challeges. Keya also faced techical challeges with its migratio process. Iitially, i 2009, Keya adopted the first-geeratio Digital Video Broadcastig Terrestrial (DVB-T) televisio trasmissio stadard ad MPEG 4 video compressio stadard, but soo after, switched to the secod-geeratio DVB-T2 stadard i 2010 due to its greater chael capacity. The chage i stadards reduced the umber of compliat set-top boxes (STBs), promptig the govermet to istitute various measures to address the resultig challeges. It established ew miimum STB specificatios for DVB-T2, fast-tracked vedor authorisatio to expad the STB supplier pool, reduced taxes o digital televisio receivers to make them more affordable, removed import duties ad reduced type approval fees.

10 Digital Migratio Process i Keya 8 Fudig challeges. Fudig a digital migratio process is a challege i ay coutry ad particularly so i emergig markets with more limited resources. Moreover, the iitial approach of usig SIGNET, a public etity, as the BSD, limited this etity to public fudig. Iitially, the DTC recommeded that SIGNET receive fudig to support the provisio of BSD services durig the simulcast period, but SIGNET did ot receive sufficiet public fudig. The lack of fudig (as well as the five-year process to icorporate SIGNET ad obtai its licece) delayed SIGNET s ifrastructure deploymet. Cosumer challeges. The govermet, recogisig that STBs eeded to be affordable ad well-marketed, lauched cosumer awareess campaigs i Despite the govermet puttig a great deal of effort ito these campaigs, may cosumers were still either left i the dark or eve opposed the migratio. Additioally, sice public fuds were limited, the govermet ecouraged media owers to assist with cosumer awareess. Ufortuately, the opposite occurred, with traditioal media ruig egative ad campaigs, aimed at derailig the migratio process ad discouragig cosumers from buyig STBs. Some cosumers also fell prey to certai media reports that PANG, as a Chiese-owed compay, would be proe to cesorig cotet if the Keya govermet requested it. Results Keya s ASO was fialised i The process took ie years, three more tha origially plaed, but still i keepig with the GE06 deadlie of Settig a earlier timelie allowed the govermet greater flexibility to make ay ecessary adjustmets while still meetig the GE06 deadlie. The trasitio allowed the govermet to recover 168 MHz i the 700 MHz ad 800 MHz bads ad repurpose these frequecies for mobile services. 800 MHz bad (the first digital divided). The govermet first moved forward with the 800 MHz bad. It divided the bad ito three blocks of 2 x 10 MHz; ad i Jue 2016, awarded trial mobile liceces to Keya s three mai mobile operators. These operators have begu deployig ew 4G etworks to provide mobile broadbad services. I November 2016, the govermet plas to award a fial licece to Safaricom. Airtel ad Telkom Keya should receive their fial liceces i March MHz bad (the secod digital divided). For the 700 MHz bad, Keya adopted a 2 x 30 MHz chael arragemet, cosistet with the ITU regioal recommedatios. Keya has allowed public ad private etities to lauch trial etworks i the 700 MHz bad ad is expected to auctio this bad sometime i the ear future. Ultimately, Keya overcame the challeges outlied above ad successfully created a more robust broadcastig sector. The govermet met the GE06 deadlie, ad also icreased the populatio covered by televisio by 20% ad the total umber of broadcasters by four ad a half times (see Figure 3). I additio, the umber of broadcasters reachig multiple cities grew from five to 22, allowig for greater cosumer choice ad tailoredcotet.

11 Executive Summary 9 FIGURE 3: KENYA BROADCASTING MARKET PRE-MIGRATION (Aalogue) POST-MIGRATION (Digital) POPULATION COVERED BY TV 55% 66% NUMBER OF BROADCASTERS NUMBER OF BROADCASTERS REACHING MULTIPLE CITIES 5 22 SPECTRUM FOR TV BROADCASTING 448 MHz 224 MHz Source: TMG research.

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13 Key Characteristics of the Digital Migratio Process i Keya 11 1 Key Characteristics of the Digital Migratio Process i Keya 1.1 Backgroud Keya s Implemetatio of the GE06 Agreemet Prior to 2006, regioal treaties datig as far back as 1961 govered the allocatio ad maagemet of terrestrial televisio spectrum i Keya. 1 I 2006, the ITU Regio 1 member states, 2 icludig Keya, etered ito the GE06 Agreemet (GE06), which replaced part of these older agreemets, ad set a aalogue switch-off (ASO) deadlie of 17 Jue For Keya, the GE06 was cosidered a bidig agreemet uder its costitutio ad iteratioal law. Pursuat to the GE06, Keya iitiated the migratio from aalogue to digital broadcastig techologies ad developed a digital broadcastig pla coverig the MHz ad MHz bads. 4 FIGURE 4: NUMBER OF COUNTRIES COMPLETING THEIR ASO PER YEAR ( ) Source: ITU Status of the Trasitio to Digital TV. 5 Betwee 2006 ad 2015, 66% of the 123 GE06 sigatory coutries completed their ASO. Keya was oe of the 37 coutries that completed its ASO i 2015 (See Figure 4). To date, Keya is oe of oly seve of the 54 Africa GE06 sigatories to have completed the ASO. A list of coutries that have ot yet completed their ASO is i Appedix B Stakeholders i the Digital Migratio Process The govermet egaged a broad group of stakeholders to participate i the digital migratio process, icludig some represetatives from the public sector, the private sector (e.g., broadcastig ad mobile operators), ad other relevat idustry participats (See Figure 5). The two primary govermet etities icluded were the Miistry of Iformatio, Commuicatios ad Techology (MICT) ad the ICT regulator, the Commuicatio Authority (CA). 6 The MICT developed the policies relatig to the digital migratio process ad CA implemeted the GE Regioal Agreemet for the Europea broadcastig areas, Stockholm 1961 ad Regioal Agreemet relatig to the plaig of VHF/UHF televisio broadcastig i the Africa broadcastig area ad Neighbourig coutries, Geeva, Regio 1 covers coutries i Europe, the Middle East, the former Soviet republics, Africa, ad the Middle East west of the Persia Gulf 3 Regioal Agreemet relatig to the Plaig of VHF/UHF Televisio Broadcastig i the Africa Broadcastig Area ad Neighbourig Coutries, Geeva 1989 (as revised by RRC-06-Rev.GE89). 4 Durig the RRC-06, the various atioal draft frequecy plas were preseted by the member states so that the televisio chael arragemets could be reorgaised for coordiatio ad avoidace of iterferece. Commuicatios Commissio of Keya, Uderstadig Migratio From Aalogue to Digital TV Broadcastig i Keya, Sectio visited o 13 Sept Whe the digital migratio was iitiated the regulatory body was the Commuicatios Commissio of Keya (CCK), established by the Keya Iformatio ad Commuicatios Act, 1998 (KICA). Pursuat to the Keya Iformatio ad Commuicatio (Amedmet) Act of 2013, the CCK was rebraded i 2014 as the Commuicatios Authority (CA). For purposes of this documet, we will use CA to refer to the regulator uless the cotext requires otherwise. 7 Uder its Costitutio ad its iterpretatio of iteratioal law, the Keya govermet viewed the Fial Acts of RRC-06 as legally bidig.

14 Digital Migratio Process i Keya 12 FIGURE 5: DIGITAL MIGRATION STAKEHOLDERS Govermet MICT/CA Chair: Miister, MICT Migratio Task Force Digital Televisio Committee Chair: Pricipal Secretary, MICT Recommedatios Maagemet Govermet Agecies: MICT, NCS, CA, KBC Private Sector: MOA, APA ad ICT Cosultats Govermet Agecies: MICT, NCS, CA, KBC, MOA Private Sector: BSDs, Pay TV providers Private Associatios: Cosumer Associatios, Digital Broadcasters ad Vedors Associatio Source: TMG research. As part of its policy-makig resposibility, the MICT developed two multi-stakeholder groups to assist with the migratio process the Task Force o the Migratio from Aalogue to Digital Broadcastig (Migratio Task Force) ad the Digital Televisio Committee (DTC). The Migratio Task Force prepared a report that became the roadmap for the digital migratio process. The DTC, i tur, implemeted the roadmap ad maaged the process. The use of a multi-stakeholder group approach to develop ad implemet the digital TV migratio was also adopted i other East Africa coutries, such as Rwada, Tazaia ad Ugada. This approach has proved useful by brigig together diverse iterests ivolved i a digital broadcastig trasitio govermet, regulator, broadcasters, equipmet maufacturers, advertisers ad other supporters of broadcast busiess models. To this ed, a key factor determiig the success of a coutry s digital migratio is the participats level of egagemet i a multi-stakeholder group. I this respect, Tazaia s approach was desiged to maitai the participats focus o specific tasks ad egage them throughout the process. I cotrast, some participats i Keya s multi-stakeholder groups, particularly broadcasters, did ot believe that their viewpoits were cosidered. Rather tha view the multi-stakeholder approach as collaborative, some broadcasters felt that their iput was ot cosidered ad that the process was perfuctory. As a result, Keya s process did ot result i the differet stakeholders reachig agreemet o the way forward. Istead, it culmiated i litigatio that cotributed to sigificat delays i the overall trasitio.

15 Key Characteristics of the Digital Migratio Process i Keya 13 Task Force o the Migratio from Aalogue to Digital Broadcastig (Migratio Task Force) Keya s Migratio Task Force, established i 2007, 8 was resposible for providig recommedatios ad assistig i the developmet of a atioal strategy for the ASO. The Task Force members cosisted of govermet represetatives ad private sector stakeholders with a role i televisio broadcastig. 9 These icluded: MICT; Natioal Commuicatios Secretariat (NCS); CA; Keya Broadcastig Corporatio (KBC); Media Owers Associatio (MOA); Associatio of Practitioers i Advertisig (APA); ad idividual ICT cosultats. 10 Although CA stated that the Migratio Task Force s fial decisios were maily reached by cosesus, some broadcasters disagreed. 11 These broadcasters felt that their opiios were ot fully cosidered whe fial decisios were reached. 12 The resultig litigatio demostrated how it is ot oly importat to establish the vehicle for participatio, such as through the creatio of a multi-stakeholder forum, but it is equally importat to esure that all stakeholders feel that their iput is cosidered, ad reflected i the roadmap ad implemetatio. I additio, it is also importat that persos speakig o behalf of a particular stakeholder group are widely accepted as represetig the broader commuity withi the multi-stakeholder group. If represetatives of a stakeholder group are ot see as valid, the their opiios ad commitmets may ot be accepted by the broader stakeholder commuity. Digital Televisio Committee (DTC) I December 2007, the MICT established the DTC, which was divided ito three subcommittees techical, regulatory ad cosumer awareess. The multi-stakeholder DTC icluded CA, the MICT, broadcasters, BSDs, STB vedors ad cosumer associatios (i.e., the Cosumer Uity & Trust Society-Africa Resource Cetre, the Keya Cosumers Orgaisatio ad the ICT Cosumers Associatio of Keya). The DTC s tasks icluded: maagig the migratio process withi a specified timeframe; developig a appropriate switchover strategy; recommedig measures to be take to esure availability of STBs; respodig to public cocers; idetifyig likely bottleecks to the uptake of digital broadcast; makig recommedatios related to fiscal measures, if ay, that eed to be take to ecourage uptake of digital televisio services; developig ad implemetig a appropriate cosumer awareess strategy; ad moitorig ad evaluatig the awareess, uptake ad use of ew services ad adjustig the campaig accordigly. The primary DTC outputs were a schedule of ASO phases ad dates, ad implemetatio of the Migratio Task Force s recommedatios. 8 Uderstadig Migratio from Aalogue to Digital TV Broadcastig i Keya, Sectio 8 9 Commuicatios Authority of Keya (2016, September 9). Telephoe iterview with Alfred Ambai, Assistat Director. 10 Report of the Task Force o Migratio of Terrestrial Televisio from Aalogue to Digital Broadcastig i Keya, July 2007, Sectio Commuicatios Authority of Keya (2016, September 9). Phoe iterview with Alfred Ambai, Assistat Director. 12 Media Owers Associatio (2016, September 13). Phoe iterview with Lyette Mwagi.

16 Digital Migratio Process i Keya Roadmap The Migratio Task Force drafted the Report of the Task Force o Migratio of Terrestrial Televisio from Aalogue to Digital Broadcastig i Keya (Task Force Report) i July MICT approved the Task Force Report i November This documet became the roadmap for the digital migratio process. It icluded the key policy ad techical recommedatios, as well as the ASO timelies, addressig: digital broadcastig stadards: sigal distributio: cotet issues i digital broadcastig: policy ad regulatory cosideratios: ad cosumer issues. While the govermet expressed certai views prior to the establishmet of the Migratio Task Force (e.g., the cocept of sigal distributio), 14 the issues addressed by the roadmap covered the major problems facig Keya, or ay other coutry, i preparig for a digital migratio process. The roadmap icluded a clear timelie (eve though it was ultimately delayed i Keya s case), which was crucial for esurig that all stakeholders had a clear uderstadig of the process ad its milestoes. Similarly, the roadmap emphasised early cosideratio of cosumer issues a elemet critical to miimisig cofusio amog viewers. Because the digital migratio pla etailed itroducig a ew digital service i the same frequecy rage as the aalogue service, it required a trasitio period whe both aalogue ad digital broadcastig televisio would be trasmitted at the same time (the simulcast period). The Migratio Task Force recommeded dividig the migratio process ito three distict phases: digital switch-o (DSO), simulcast period, ad ASO. The Migratio Task Force also cosidered the impact of multichael viewig ad o-demad services, ad recommeded agaist imposig specific programme requiremets for digital televisio. It oted that programmig requiremets were warrated for aalogue broadcastig because the techical ature of aalogue televisio meat that oly oe programme could be trasmitted per chael durig the same time period. I cotrast, digital broadcastig techologies eable operators to offer multiple programmes simultaeously per chael. 15 The Migratio Task Force adopted a forward-lookig perspective by recogisig that the ew digital eviromet required a differet, more flexible regulatory approach, ad recommeded agaist imposig specific programmig obligatios that could suppress iovatio ad reduce cosumer choice. Thus, the Migratio Task Force advocated for light-touch ad self-regulatio regardig programmig requiremets. Ultimately, the work of the DTC ad Migratio Task Force resulted i the desig, implemetatio ad completio of the ASO, begiig i March 2006 ad edig i Jue A summary timelie of the digital migratio process i Keya is show i Figure 6. FIGURE 6: TIMELINE OF KENYA S DIGITAL MIGRATION PROCESS ICT Sector Policy Guidelies Task Force Report preseted Creatio of the DTC Simulcast set to begi Origial ASO deadlie Process completed before GE06 deadlie March 2006 March 2007 October 2007 November 2007 December 2007 August 2008 August 2009 November 2009 Jue Jue 2015 Creatio of Migratio Task Force Task Force Report approved Deadlie to licese BSDs Simulcast begis operatio Phased-i approach ASO adopted due to delays Source: TMG aalysis. 13 Report of the Task Force o Migratio of Terrestrial Televisio from Aalogue to Digital Broadcastig i Keya, July Natioal Iformatio & Commuicatios Techology (ICT) Policy Guidelies, Ja. 2006, Sectio 4.6, available here 15 Report of the Task Force, Sectio 5.2

17 Key Characteristics of the Digital Migratio Process i Keya Digital Migratio Framework Creatio of Broadcastig Sigal Distributors The Migratio Task Force report recommeded amedig the broadcastig licesig framework by ubudlig broadcast cotet creatio from distributio through the creatio of sigal distributors, cosistet with the 2006 ICT Policy Guidelies. The govermet cosidered this the best vehicle to expad coverage, ehace competitio ad achieve greater spectrum efficiecy, accordig to the report (See Box 1). 16 BOX 1: RATIONALE AND BENEFITS OF UNBUNDLING THE BROADCASTING CONTENT 1. Lack of coverage: At the time of the start of the trasitio, aalogue televisio sigals covered just 55% of the populatio. 17 By ubudlig cotet creatio from sigal distributio, more resources could be deployed to expad coverage istead of beig divided betwee cotet creatio ad ivestmets i broadcastig ifrastructure. 18 The BSD model creates cost savigs because each broadcaster does ot eed to obtai spectrum ad maitai sigal distributio ifrastructure. 2. Lack of competitio: The govermet asserted that the high costs of producig cotet ad deployig trasmissio ifrastructure were barriers for ew etrats to eter the broadcastig market. 19 I additio, the frequecies assiged to the broadcasters oly accommodated oe aalogue televisio chael. The high cost of deployig ifrastructure, combied with the scarcity of frequecies, obstructed competitio. Cosiderig cosumer equipmet costs, the govermet s selectio of a uiform digital broadcastig stadard preveted BSDs from choosig differet stadards, which would have required cosumers to obtai more complex ad more expesive digital receivers. 3. Takig advatage of the ehaced efficiecy of digital distributio: The govermet viewed digital broadcastig as a opportuity to expad broadcastig capabilities because digital broadcastig accommodates more televisio chaels tha aalogue broadcastig, while also usig less spectrum badwidth. 20 For example, the adopted DVB-T2 MPEG-4 stadard accommodates up to 20 stadard defiitio televisio chaels i the same amout of spectrum used to trasmit oe aalogue televisio chael. This created better efficiecy i spectrum maagemet, allowed for more uiform broadcastig coverage, ad reduced potetial sigal iterferece. With fewer sigal distributors competig for spectrum, the likelihood of sigal iterferece is reduced. All cotet providers employig a particular BSD will have equal coverage, thereby limitig the coverage variatios to the differeces betwee the relatively few BSDs. To take advatage of this efficiecy, the govermet determied that the best course of actio was to implemet a BSD licesig framework. Usig BSDs would aggregate the distributio chaels ito desigated distributors as opposed to licesig 20 separate stadard defiitio chaels that require their ow frequecies ad ifrastructure. 21 These ifrastructure ivestmet costs icluded ivestig i a trasmittig statio ecompassig access roads, electricity, buildigs, security, vetilatio, air coditioig, geerators, towers/masts with commo trasmittig ateas, satellite uplik ad receivig facilities, as well as techical staff Report of the Task Force, Sectio Alfred Ambai, CA, Status of Digital Switchover i Keya, Africa Forum, May 2016, at Uderstadig Migratio from Aalogue to Digital TV Broadcastig i Keya, Sectio 12(b) 19 Uderstadig Migratio from Aalogue to Digital TV Broadcastig i Keya, Sectio 12(a) 20 Ibid. 21 Id. 22 Report of the Task Force, Sectio 4.2.

18 Digital Migratio Process i Keya 16 Elemets of Broadcast Distributio ad Cotet Framework Uder the proposed framework, separate market segmets would exist with broadcasters cocetratig oly o cotet productio ad BSDs providig the broadcastig ifrastructure. The BSDs would eed to provide: (i) all licesed broadcasters with ope access to their digital platform o a fair, odiscrimiatory basis; ad (ii) digital trasmissio coverage that was similar to or better tha the aalogue trasmissio coverage. I additio, the Migratio Task Force recommeded that the public broadcaster, KBC, be grated authority as a BSD, but the sigal distributio service would be coducted by a separate etity to avoid coflicts of iterest or cross subsidies. 23 Licesig of Broadcast Sigal Distributors To implemet the recommedatios, i February 2008, the MICT grated KBC coditioal authority as a BSD licesee. To receive the BSD licece, as recommeded by the Migratio Task Force, KBC had to establish a subsidiary compay, SIGNET, which would provide BSD services. The process of icorporatig SIGNET as a idepedet etity took five years, ad SIGNET did ot obtai a licece to provide BSD services util December I the iterim, i July 2012, the KBC was authorised to utilise the spectrum set aside for SIGNET ad provide BSD services util SIGNET was duly icorporated ad licesed. Iitially, as recommeded by the Migratio Task Force, SIGNET would provide BSD services fuded by the govermet durig the simulcast period. However, SIGNET delayed its digital ifrastructure deploymet due to fudig costraits ad the delay i obtaiig icorporatio ad the licece. As a result, the DTC later recommeded that the MICT licese private BSD providers through a competitive procuremet process. CA lauched the teder process i February Of the ie firms that expressed iterest i obtaiig a BSD licece, six prequalified to proceed to the teder stage of the process, but oly four submitted bids to participate i the techical evaluatio stage. Of these four, oly oe bidder, Pa Africa Networks Group (Keya) Co. Ltd. (PANG), qualified to proceed to the fiacial evaluatio stage. I October 2011, PANG was awarded a BSD licece. 24 At the time of the award, PANG was 100% Chieseowed. This foreig owership prompted certai media reports ad cosumer cocers that, as a Chiese-owed compay, it would be proe to cesorig cotet if the govermet requested it. 25 I 2014, PANG was made to divest 20% of its equity to local shareholders withi three years, a requiremet it subsequetly met. 26 The award of the licece to PANG prompted three major private broadcasters, the Natio Media Group, Stadard Group ad Royal Media Services, to lauch legal challeges before differet courts arguig for their right to have BSD liceces. 27 I 2015, as part of the resolutio from the litigatio betwee the govermet ad the broadcasters, a self-provisioig BSD licece was issued to a cosortium composed of the three private broadcasters, called the Africa Digital Network (ADN). Self-provisioig BSD liceces differ from stadard BSDs as the licesees ca oly trasmit their ow cotet over their ifrastructure. Despite delays caused by SIGNET ad litigatio, the ubudled licesig framework has had positive impacts o the broadcasters busiess models. Broadcasters are o loger required to focus o ifrastructure ivestmet. Istead, they are able to cocetrate o cotet productio. Also, by elimiatig the eed to ivest i the trasmissio etwork, the migratio reduced etry barriers for ew broadcasters, leadig to a sigificat icrease i broadcasters. Accordig to the MICT, Keya had 14 broadcasters before the migratio started ad ow has 65, a icrease of four ad a half times. 28 May broadcasters are formig parterships with smaller broadcastig compaies that produce local cotet for the large atioal broadcasters. This arragemet is a wi-wi for both parties, with larger broadcasters havig access to a broader pool of cotet ad smaller broadcasters geeratig reveues from the local cotet Policy ad Regulatio Legal Implemetatio of the Iteratioal Digital Migratio Obligatios I additio to establishig a timeframe for the ASO i sigatory coutries, the GE06 established a digital televisio pla for both the VHF ad UHF bads. Keya icorporated the pla ito its ICT Policy Guidelies of The Guidelies set forth the high- 23 Id. Sectio Uderstadig Migratio from Aalogue to Digital TV Broadcastig i Keya, Sectio 12(c) See Supreme Court, Media Summary, at See Sectio Miistry of Iformatio, Commuicatios ad Techology (2016, September 27). Phoe iterview with Sammy Itemere, Pricipal Secretary; TCRA, Commuicatios Statistics Report, Ju. 2016, available at CommStatJue16.pdf 29 Media Owers Associatio (2016, September 13). Phoe iterview with Lyette Mwagi.

19 Key Characteristics of the Digital Migratio Process i Keya 17 level parameters of the digital televisio migratio, specifyig that: (i) the MICT would maage the trasitio from aalogue to digital broadcastig; 30 ad (ii) the govermet would licese sigal distributio services to esure that the use of broadcastig ifrastructure is maximised Regulatory Authorities Before the digital migratio, the broadcastig licesig framework ivolved a two-stage process betwee the MICT ad CA. The MICT issued broadcastig permits, while CA, i tur, performed the techical fuctio of assigig the broadcast frequecies to the permit holders. I 2009, the Keya Iformatio ad Commuicatios Act (KICA) expaded CA s madate to iclude the licesig ad regulatio of broadcastig services. 32 This chage streamlied the licesig process, ad gave CA greater idepedece ad resposibility, eablig CA to issue broadcastig permits ad perform the techical fuctio of assigig frequecies ad regulatig licesees Legal Authority The ICT Policy Guidelies ad the KICA allowed the MICT to issue geeral policies, such as adoptig the ASO timelies as recommeded i the Task Force Report, while CA focused o implemetatio of the policies. 33 The KICA also defied the obligatios of broadcastig services, established KBC as the public broadcaster, ad gave powers to the MICT ad CA to regulate broadcastig. Amog other rights, the KICA expaded the scope of the broadcastig permits to iclude sigal distributio services, as well as mechaisms eablig the trasitio to the ew framework. 34 The KICA s trasitioal provisios allowed existig licesees to cotiue operatig for up to oe year uder the terms of their existig licece, but durig that period, they were required to apply for liceces uder the ew regime. 35 This clear trasitio period has bee adopted elsewhere. For example, i Tazaia, cotet service provider liceces lapsed at the ed of the 18-moth trasitio period, requirig the surreder of spectrum used for aalogue broadcastig Regulatory Framework for Broadcastig Services The Iformatio ad Commuicatios (Broadcastig) Regulatios, implemeted i 2009, regulate cotet ad licesig for broadcastig ad pay televisio services, icludig terrestrial, cable ad satellite distributio. 37 The regulatios task CA with specifyig the multiplex capacity for broadcast cotet ad the techical specificatios of the multiplex ad associated digital trasmitters. They also defie the coditios for offerig commercial free-to-air (FTA) broadcastig service ad BSD services. I additio, certai other regulatios imposed additioal coditios to offer broadcastig ad BSD services. The coditios iclude the followig: All aalogue televisio broadcasters must retur their FTA televisio broadcastig frequecies to CA ad apply for ew broadcast liceces. 38 BSDs may impose charges i relatio to cotractual arragemets, the receptio of broadcastig services requirig coditioal access, ad the provisio of ay apparatus or device eablig the receptio of digital broadcastig services, icludig FTA broadcastig services. 39 However, their tariffs must be approved by CA. 40 To address cocers about high prices, CA imposed a price cap o BSDs for sigal distributio of KES 125, per Mbit for Nairobi ad KES 93, per Mbit for the remaider of Keya. 41 All licesees must provide uiform, o-preferetial service o a first-come, first-served basis to all requestig such service. 42 Type approval is required for all electroic commuicatios equipmet, icludig STBs. 43 Keya s approach to a regulatory framework for broadcastig services that is, ubudlig BSDs ad cotet is ot ucommo amog the Africa states that have prepared digital migratio plas. A similar approach was employed i Malawi, Nigeria, Rwada, South Africa, Tazaia ad Ugada, ad is expected i Burudi. Notably, however, the ubudled approach did ot geerate as much debate ad litigatio i these coutries as i Keya. 30 ICT Policy Guidelies, Sectio ICT Policy Guidelies, Sectio The Keya Iformatio ad Commuicatios Act (KICA), 1998, Revisio 2009, Ameded I 2013, the Commuicatios Commissio of Keya (CCK), as it was the kow, was replaced by CA, pursuat to a amedmet to the KICA. 33 Alfred Ambai, at KICA Act, Sectios 46A to 46S. 35 KICA Act, Sectio 46R ad Fifth Schedule. 36 Electroic ad Postal Commuicatios (Digital ad other Broadcastig Networks) Regulatios, Sectio Keya Iformatio ad Commuicatios (Broadcastig) Regulatios, Id. Regulatio at Id. Regulatio at Keya Iformatio ad Commuicatios (Tariff) Regulatios, 2010, Regulatio Give the demad for frequecy spectrum resources ad the ecoomics of sigal distributio, such services are provided by oly a few licesees, as such CA cosidered it ecessary to cap tariffs for sigal distributio. FTA broadcasters argued that existig BSDs were chargig exorbitat tariffs. After holdig a cosultatio process with the BSDs ad broadcasters, CA set the capped tariff plas. CCK, Determiatio 1/2013, Cost-based Terrestrial Digital Broadcastig Sigal Distributio Tariff, Dec. 2013, Art Keya Iformatio ad Commuicatios (Fair Competitio ad Equality of Treatmet) Regulatios, 2010, Regulatio Keya Iformatio ad Commuicatios (Importatio, Type Approval ad Distributio of Commuicatios Equipmet) Regulatios, 2010, Regulatio 3.

20 Digital Migratio Process i Keya 18 The ratioale for a ubudled approach geerally flows from policy goals that iclude improvig sigal quality ad coverage ad lowerig the barriers to etry for cotet providers, especially from local cotet producers. I Keya ad other coutries, separatig distributio from cotet productio allowed etities to focus o a core competecy ad, i the process, improve broadcast coverage ad competitio amog cotet providers. I additio, Keya s regulatios allowed for the use of market forces to determie appropriate tariffs for the distributio of broadcasters cotet, but with a safeguard of potetial regulatory itervetio if warrated. This approach helped to balace the efficiecy of the market with oversight to guard agaist abuses of market power, icludig those that could arise from the cocetratio of the BSD market amog a small umber of players. To the extet that other coutries idetify a eed to improve broadcast coverage ad/or to lower barriers to cotet provider market etry, a examiatio of Keya s model would provide oe possible approach. 1.3 Digital Migratio Pla The digital migratio process cosisted of three phases: digital switch-o (DSO); simulcast period; ad ASO, 44 as show i Figure Plaig With regard to the digital migratio pla, the Migratio Task Force recommeded adoptio of either: (i) a policy-drive approach to digital migratio, with a firm atiowide switchoff date or (ii) a phased switch-off of aalogue services withi a period of three years. The govermet origially opted for a atiowide ASO date of Jue 2012, but later followed a phased ASO approach takig ito accout the differet levels of ifrastructure deploymet i differet parts of the coutry. This chage i approach was due to a combiatio of factors, icludig KBC s iitial difficulties i deployig its etwork, litigatio that delayed the migratio process, cosultatios with stakeholders ad improvemets to later phases based o lessos leared durig the earlier phases. 45 I additio, frequecies would o loger be assiged to broadcasters oce sigal distributors were i place. 46 Most coutries aroud the world have employed a phased ASO approach because it allows for a iterative deploymet, applyig lessos from early phases to later phases. Choosig which areas are icluded i each phase depeds o the govermet ad stakeholders view of whether it is best to progress regioally, from most-populated to least-populated (or vice versa), or through aother approach. Other cosideratios may iclude the speed at which ew ifrastructure ca be deployed i a particular regio ad the availability of spectrum resources. Some FIGURE 7: DIGITAL MIGRATION PHASES DSO (2009) Simulcast ( ) ASO (2015) Period of itroductio of digital broadcastig services ivolvig the developmet of the digital ifrastructure, icludig itroductio of a sigal distributor, ad availability of STBs Period whe both aalogue ad digital chaels are o air, givig time for gradual replacemet of ifrastructure, ad for viewers to acquire STBs Ed of switchover process, whe aalogue trasmissios are switched off, cosiderig that most households ca receive digital sigals ad have digital receivers Source: TMG research. 44 Report of the Task Force, Sectio Miistry of Iformatio, Commuicatios ad Techology, Aalogue Switch off dates, available at 46 Id. Sectio 6.5.

21 Key Characteristics of the Digital Migratio Process i Keya 19 coutries have employed atioal ASO approaches, which are likely more maageable i cases where the umber of televisio viewers is relatively low, the deploymet of ew ifrastructure ca be completed uiformly atiowide, or whe the govermet prioritises equal treatmet of all subscribers ad regios. I Keya, the BSDs were tasked with promotig the take-up of digital terrestrial televisio so that the frequecy spectrum used for aalogue broadcastig could be released as soo as possible. Durig the trasitio period, each existig broadcaster was allotted oe digital programme, allowig them to cotiue offerig digital services. 47 Whe the simulcast period bega, less tha 55% of the populatio had aalogue TV coverage. There were 14 aalogue TV broadcasters, with oly five havig sigals i multiple cities. 48 The migratio simplified the process, meaig that each broadcaster eeds oly a sigle licece for cotet, while the BSDs provide the ifrastructure. Each BSD was assiged a miimum of two multiplex frequecies for each broadcast area, coutrywide. I its Report, the Migratio Task Force cosidered that existig aalogue terrestrial broadcastig services should migrate to digital trasmissio etworks based o their ow commercial strategy ad ecoomic cosideratios. 49 Accordigly, the availability of cotet i the digital platform would deped o their iterests, ad would oly be subject to the ASO deadlie. This is i lie with the approach take by govermets i most coutries with respect to commercial broadcasters Implemetatio O 9 December 2009, the digital migratio process i Keya bega with the lauch of digital broadcastig i Nairobi. As oted above, the ASO deadlie was iitially set for Jue 2012, but was moved several times by the DTC. Ultimately, i November 2014, the govermet decided to shift to a three-phase ASO approach: 50 Phase 1 was completed o time. Phase 2 was completed 12 days late o 14 February Phase 3 was also delayed, but completed before the GE06 deadlie of 17 Jue 2015 (the remaiig sites were divided ito two groups ad switched off i two stages). 51 Accordig to the broadcasters, a sigificat declie i viewership occurred i the first moths after the ASO. 52 However, the curret digital televisio coverage is 66% of the Keya populatio, exceedig that of the aalogue chaels whe the migratio started. Two BSDs have deployed ifrastructure i 23 tows, with ogoig rollout i remote sites. ADN has a self-provisioig licece. I additio, there are two digital terrestrial televisio (DTT) pay televisio providers GoTV ad StarTimes ad 65 FTA chaels o digital terrestrial televisio broadcastig (DTTB). Furthermore, Keya has approximately 90 STB models, ad 30 digital televisio (DTV) models with itegrated digital receivers with type approval from CA. The regulator estimates that more tha four millio STBs have bee sold. 53 Although Keya s digital migratio process took loger tha origially plaed, it resulted i icreases i both populatio coverage ad the umber of chaels offered to viewers. This outcome took early seve years from the date that the first digital broadcast bega, ad two years after the ASO i Nairobi. Switchig to a three-phase ASO process allowed Keya to lear from the trasitio i Nairobi ad apply those lessos to the Phase 2 ad Phase 3 regios. For example, the delays to the migratio timelie, maily due to litigatio, slowed the migratio process ad ifrastructure deploymet, ad almost certaily caused cosumer cofusio ad reticece to embrace the ew techology. A key lesso i these delays is that a migratio process with buy-i from all stakeholders may take time ad resources, but it may assist i prevetig challeges to the process. Phase 1: 31 December 2014 Nairobi ad its surroudigs; Phase 2: 2 February major tows; Phase 3: 30 March 2015 remaiig remote aalogue sites. 47 Id. 48 Alfred Ambai, at Report of the Task Force, Sectio A. M. Ambai, CTO Digital Broadcastig Africa Forum 2016, Status of Digital Switchover i Keya, 51 Ibid. 52 Media Owers Associatio (2016, September 13). Phoe iterview with Lyette Mwagi. 53 Commuicatios Authority of Keya (2016, September 9). Phoe iterview with Alfred Ambai, Assistat Director.

22 Digital Migratio Process i Keya Digital Broadcastig Chael Pla The Migratio Task Force aticipated some iitial challeges durig the trasitio period, icludig costraits to the implemetatio of the digital broadcastig pla. The reasos for these challeges iclude the followig: 54 most of the proposed digital chaels would oly be available after the existig aalogue chaels had bee coverted to digital or switched-off. I additio, most of the chaels i the digital pla were icompatible with the existig aalogue assigmets; the GE06 required obtaiig agreemet from eighbourig coutries before a umber of Keya s digital chaels could be utilised; ad there was a eed to upgrade the aalogue receivers for the receptio of digital broadcastig (i.e., STBs or itegrated DTVs). I preparig for this digital migratio process, CA foud the ITU s geeral guidace to coutries i the GE06 plaig areas o all aspects of the digital migratio to be quite helpful. Keya participated i the various ITU meetigs, as well as i the regio to assist coutries with migratio strategies, icludig frequecy plaig ad coordiatio. 55 I particular, it atteded the Regioal Radiocommuicatio Cofereces held i 2004 ad 2006, itersessioal Activities (e.g., Regioal iformatio meetigs ad workshops related to the RRC-06 for the Africa coutries), ad the World Radiocommuicatio Semiars. These meetigs, as well as the ITU s Guidelies for the Trasitio from Aalogue to Digital Broadcastig, were useful for Keya ad other Africa coutries to address digital migratio issues. 56 Additioal details o the chael plas ad techical cosideratios of Keya digital migratio are preseted i Appedix C Traiig for Digital Broadcastig Systems The Migratio Task Force also idetified cotet productio as a importat idustry for Keya. The broadcastig idustry was ecouraged to establish traiig programmes that icorporated digital broadcastig techiques. It also tasked the govermet with streamliig the developmet ad supervisio of curriculum used i the media traiig istitutios. 57 While the govermet did ot arrage ay formal traiig, broadcasters worked with their vedor parters to arrage traiig for appropriate persoel. The BSDs, whe acquirig the techical facilities ad equipmet to provide service, were able to sed their persoel to perform factory acceptace tests, which also gave them the opportuity to receive techical traiig. The STB vedors also set experts to trai some selected sales staff. Iterally, DTC members traied staff from the compaies egaged to develop ad carry out cosumer awareess campaigs. 58 Keya s emphasis o local cotet productio ad traiig ca provide a represetative list of traiig targets related to the digital televisio migratio, as i Table 2. TABLE 2: TRAINING TARGETS RELATED TO DIGITAL MIGRATION Etity Techical traiig o digital broadcastig equipmet Digital cotet productio techiques Cosumer awareess techiques Sales/promotio-related techiques Cotet producers BSDs or equivalet Cosumer equipmet maufacturers Regulator 54 Report of the Task Force, Sectio Commuicatios Authority of Keya (2016, September 9). Phoe iterview with Alfred Ambai, Assistat Director. 56 Available at 57 Report of the Task Force, Sectio Obam, D. (2016, September 23). iterview.

23 Key Characteristics of the Digital Migratio Process i Keya Cosumer Awareess The Migratio Task Force raised several poits related to cosumer uptake of the digital techology. Broadcasters were ecouraged to migrate from aalogue to digital techology i studio facilities i order for the public to fully appreciate the differece i quality betwee aalogue ad digital trasmissio. I additio, availability of relevat cotet is a importat determiat i the uptake of digital broadcastig services. 59 Statistics idicated that 90% of viewers were watchig local cotet; therefore, broadcasters would eed to work o offerig more relevat local cotet. 60 The Task Force recommeded that appropriate policies be put i place to promote access to, use of, ad distributio of cotet i the diverse digital service eviromet. It also cosidered that adequate fuds should be allocated for marketig to create awareess of the migratio ad its implicatios. The Migratio Task Force also idetified the availability of digital receivig apparatus at affordable prices as crucial to early mass market uptake of digital broadcastig techology. Pricig of such receiver equipmet could be the biggest sigle obstacle to or eabler of the itroductio of digital broadcastig i Keya. The Task Force oted that there should be a effective cosumer educatio strategy coverig all areas of cocer, icludig the migratio process ad switch-off dates. The strategy would eed to itegrate all the market players i the broadcastig value chai i order to yield the expected beefits. They also recommeded that the govermet provide icetives to the idustry to promote ad explai the services to customers; moitor ad evaluate the awareess, take-up ad use of the ew services; ad adjust the campaig accordigly. Broadcasters were required to assist the DTC with migratig Keyas to the digital platform by doatig space ad airtime to promote the digital migratio process ad its beefits, which was doe maily by KBC. 61 Ufortuately, some media owers ra egative campaigs agaist the migratio, hopig to prevet the migratio ad discourage cosumers from buyig STBs. I Jue 2012, CA also created the Digital Keya brad associated with cosumer awareess campaigs through differet media chaels. It icluded a dedicated website ( go.ke/) ad the use of social media (See Figure 8). The first large scale campaig was lauched uder the sloga joi the great digital migratio, usig prit, radio/televisio media ad roadshows. Later, the sloga Tuatoka aalogue, Tuaeda digital was added ( We are from aalogue, We are goig digital ). 62 Overall, the cosumer awareess efforts were estimated to have reached 88% of Keyas over a five-year period. 63 FIGURE 8: ROADSHOWS TO EXPLAIN DIGITAL TV Source: Digital Keya Facebook Page Report of the Task Force, Sectio Report of the Broadcasters Forum, Sectio Report of the Task Force, Sectio Alfred Ambai, at Obam, D. (2016, October 12). iterview. 64

24 Digital Migratio Process i Keya Use of the Digital Divided for Mobile Broadbad The digital televisio chaels were origially plaed i Bads IV/V ( MHz). After the decisio of the ITU World Radiocommuicatio Coferece 2012 (WRC-12) to idetify the 700 MHz bad for mobile broadbad, re-plaig of those digital televisio chaels was carried out through collaboratio with the Africa Telecommuicatio Uio (ATU) ad the ITU, coverig oly chaels ( MHz). 65 Keya idetified both digital divideds DD1 (800 MHz) ad DD2 (700 MHz) for wireless broadbad ad, after the decisios of WRC-15, fialised its actual chael arragemets. Oe 2 x 15 MHz block i the 800 MHz bad was origially licesed for trials to Safaricom, the largest mobile provider i Keya. As part of a teder to deploy a etwork for atioal security purposes, Safaricom egotiated the award of a licece i this bad. The other two operators, Airtel ad Telkom Keya, questioed this decisio, askig for fair treatmet i the use of the bad. I November 2015, CA asked Safaricom to retur 2 x 5 MHz of its block. With that, the bad was divided ito three blocks of 2 x 10 MHz, oe for each operator. I Jue 2016, CA approved the issuace of liceces for each operator i the 800 MHz bad, subject to a licece fee of KES 2.5 billio (USD 25 millio) each. Safaricom has completed deploymet of its etwork i the 800 MHz bad o a trial basis, ad applied for its licece, which should be issued i November Airtel ad Telkom Keya are curretly rollig out their etworks ad their liceces should be issued i March The process of makig the secod digital divided the 700 MHz bad available bega prior to WRC-15, with the ASO, ad with o digital televisio assigmets beig made above chael 48. Keya followed the ITU regioal recommedatios ad adopted a 2 x 30 MHz chael arragemet for the 700 MHz bad ( MHz/ MHz). 67 I September 2016, CA was i the process of (i) allowig public ad private etities to lauch trial etworks i the 700 MHz frequecy bad ad (ii) determiig the most appropriate method of allocatig DD2. 68 The 700 MHz bad is expected to be awarded to Tier 1 ad Tier 2 operators. 69 Idicatios are that the first block of 2 X 10 MHz i this bad could be awarded to a cosortium of small operators, followed by further direct awards or a competitive process, but o fial decisios have bee made yet. Expectatios are that each of those blocks could have a miimum price of KES 2.5 billio (USD 25 millio). 70 The mobile operators were expectig to pay a fee for the 800 MHz blocks, but the KES 2.5 billio price was sigificatly higher tha expected. 71 Despite this, Safaricom ad Airtel Keya are rollig out ew LTE services i this bad. But cautio should be used i settig licece fees as experieces i other coutries have show that whe the spectrum licece fees are too high, operators may choose ot to apply for a licece; or i doig so, may have difficulties with the deploymet of the ew mobile broadbad etworks. Although all three operators evetually received equal size blocks i the 800 MHz bad, Airtel felt as though it had to push the govermet to take back the 2 x 5 MHz segmet from Safaricom ad distribute it equally. 72 Both Safaricom ad Airtel Keya oted that greater care should have bee take durig the plaig process to assess distributio eeds beforehad ad determie how the spectrum would be utilised well before the migratio bega. This example highlights the importace of early plaig for the repurpose of the spectrum ad establishig log-term goals with clear idicatios of its ew plaed use, so as to avoid disputes or impedimets at a later stage. I additio, the full beefit of the digital divided caot be realised util the freed-up spectrum is actually put ito use. Careful coordiatio of the migratio of broadcastig out of the digital divided, plaig for future use, ad a clear schedule for gratig ew assigmets are ecessary to eable the utilisatio of the digital divided with miimal dowtime, disagreemet, or cofusio. Thus, it is importat to cosider the future repurpose of the digital divided i the iitial stages of plaig the digital migratio ad address ay potetial obstacles or cocers at the earliest opportuity. 65 Obam, D. (2016, September 23). iterview. 66 The Star, 67 Commuicatios Authority of Keya (2016, September 9). Phoe iterview with Alfred Ambai. 68 Daily Natio, 69 Miistry of Iformatio, Commuicatios ad Techology (2016, September 27). Phoe iterview with Sammy Itemere, Pricipal Secretary. 70 Obam, D. (2016, September 23). iterview. 71 Cheburet, Emmauel et all. (2016, October 6). Phoe iterview. 72 Lewela, Gaso (2016, October 10). Phoe iterview.

25 Best Key Characteristics practice i mobile of the spectrum Digital Migratio licesig Process i Keya 23 9

26 Digital Migratio Process i Keya 24 2 Mai Challeges ad Solutios 2.1 Availability ad Affordability of Set-top Boxes The lack of availability ad affordability of STBs for cosumers to receive digital broadcasts hampered the digital migratio process. This was cofirmed by a survey coducted of Nairobi s residets. 73 Nairobi was the first city i Keya where the ASO was completed. Although the majority of the survey respodets (88%) were aware of the ASO, may had ot purchased the STBs to receive the digital chaels. The most-cited reaso amog respodets for ot makig the digital switchover was because it was too expesive (43%), followed by do t kow how (15%) Availability of Set-Top Boxes ad Stadard Chage I 2007, as recommeded by the Migratio Task Force, Keya adopted the Digital Video Broadcastig Terrestrial (DVB-T) stadard for DTTB, usig MPEG-4 compressio. This was the same stadard adopted by the GE06. The pilot phase of the DTTB service, usig the DVB-T stadard, was lauched i Nairobi ad its surroudig areas i December However, i 2010, the secod-geeratio DVB-T2 stadard was lauched. I order to brig greater spectrum efficiecy ad other beefits, the DTC decided that it would be more beeficial for Keya to adopt the DVB-T2 stadard. It did ot aticipate that this chage would be very disruptive to the process, sice the DVB-T deploymet at that time was still limited, with oly oe trasmitter i operatio, ad about 10,000 DVB-T STBs sold. Although the chage would require cosumers to obtai DVB-T2 STBs, the DTC determied that goig forward with DVB-T ad the chagig to DVB-T2 at a future date would impose a greater burde, as there would be a larger istalled base of DVB-T STBs to replace at the time of the chage. I December 2010, the govermet adopted the DVB-T2 stadard for further ifrastructure rollout to fully beefit from the spectrum efficiecy gai ad service flexibility. 74 Equipmet vedors had bee advised i November 2010 to cease ay further importatio of DVB-T STBs, with all future STB imports required to comply with the govermet-approved DVB-T2 system specificatios. 75 Cosumers were ecouraged to ote the ew DVB-T2 stadard ad purchase STBs that were compatible with the ew platform. The govermet opted ot to reimburse those cosumers that had already bought DVB-T STBs that would soo become obsolete. As a trasitioal measure, SIGNET deployed a DVB-T2 trasmitter i Nairobi to simulcast the same cotet as that o its DVB-T trasmitter. Trasmissios usig the DVB-T trasmitter were termiated i September 2012, leavig oly the DVB-T2 trasmitter operatioal Affordability of Set-Top Boxes I additio to the issues surroudig the availability of appropriate STBs, the peetratio of digital televisio services was also hampered by prohibitive STB costs. Digital receivers, maily imported from Europe ad Asia, were uaffordable for average users. A cosiderable proportio of the cost was attributed to the required import duty. I additio, the ucertaity created by the various delays i the ASO, due to the iability of SIGNET to deploy its etwork as well as the litigatio, discouraged STB vedors from ivestig i large quatities of STBs. 77 This also cotributed to the STB shortage ad the resultig prohibitively high cost to ed users. I a effort to elimiate device cost as a barrier to cosumer uptake, the govermet took several steps to improve affordability: the import duty, which accouts for 25% of the device cost, was elimiated; CA waived vedor registratio fees ad reduced type approval fees for digital receivig devices by 80%, from KES 20,000 to KES 4,000; CA relaxed the miimum device specificatios by makig the coditioal access feature optioal for FTA STBs, reducig the price by a additioal 25%; the importatio, distributio ad supply of set-top boxes was fully liberalised ad opeed to ay registered vedor who obtaied type approval from the regulator. 78 This approach effectively left the supply of set top boxes i the hads of the private sector with competitio drivig dow prices GeoPoll, Aalogue to Digital Study Survey, Ja MICT, Public Aoucemet o the Switch from DVB-T to DVB-T2, Dec Public Notice, Miimum Specificatios for DVB-T2 Digital Set Top Boxes for the Keya Market, Obam, D. (2016, September 23). iterview. Commuicatios Authority of Keya (2016, September 9). Phoe iterview with Alfred Ambai. 77 CA, Uderstadig Migratio from Aalogue to Digital TV Broadcastig i Keya, at 15, available at 78 Alfred Ambai, at 13. Obam, D. (2016, September 23). iterview. 79 Commuicatios Authority of Keya (2016, September 9). Phoe iterview with Alfred Ambai, Assistat Director.

27 Mai Challeges ad Solutios 25 Two types of STBs are i use i Keya FTA-oly ad combiatio pay TV/FTA with cosumers able to decide o the receiver that best suits their eeds. Accordig to the broadcasters, most of the STBs curretly i use are from the pay TV operators, with high saturatio amog those cosumers that ca afford them. The above-outlied measures, which liberalised the STB market supply, worked. I October 2013, per CA, the total umber of STBs distributed to ed-users was just 550,538, with a additioal 532,335 i STB vedors ivetories. 80 By Jue 2016, the umber of ed-user STBs had icreased to approximately 3 millio, with a added 3.12 millio STBs havig bee imported to Keya. 81 I additio, the umber of STB vedors rose from 20 i December 2012, to more tha 79 i Jue 2015, with over 100 STB models approved by CA. 82 The icreased supply of STBs caused a reductio i price to ed users from betwee KES 10,000-15,000 i 2010 to KES 3,300 for a FTA STB ad KES 1,500 for a subsidised pay TV STB, usig a coservative example from September The Keya case shows that reducig taxes ad fees ad allowig market forces to drive the supply of STBs stimulates the productio ad import of STBs ad sigificatly reduces the cost of STBs to ed users. I less tha three years, the umber of STBs i Keya icreased by approximately 465%, causig the price of STBs to decrease by 80% or eve more i other cases. 84 As a alterative to relyig o market forces to lower the prices of STBs, the govermet could have purchased STBs i bulk to distribute them to users at a price of cost plus hadlig. This alterative was less appealig because of the fudig challeges facig the govermet. 2.2 Fudig Challeges I Keya, as i all coutries, govermet fuds must be divided amog competig iterests. The DTT ifrastructure rollout ad the cosumer awareess campaigs required sigificat govermet fudig, as well as modificatios to the iitial migratio pla i order to meet coverage targets ad raise the ecessary capital. By oe estimate, i total, the govermet spet approximately KES 5.1 billio o the etire migratio process, icludig loss of reveue from waived STB customs duties (KES 1.5 billio), advertisig ad cosumer awareess efforts (KES 1.0 billio), digital head-ed costructio (KES 2.5 billio) ad DTC operatig costs (KES 29.9 millio) Network Ifrastructure The report from the Migratio Task Force foresaw some potetial challeges for the implemetatio of BSDs, as the fuctios of a sigal distributor were previously carried out by the broadcasters that had already made sigificat ivestmets i ifrastructure. The atiowide BSD liceces require licesees to deploy the etwork i low-desity areas as well as the more-profitable urba areas. Where the existig ifrastructure was ot adequate, the migratio proposal required upgrades to accommodate digital trasmissio both durig the simulcast period ad after. The high setup costs were expected to limit the umber of sigal distributors. I order to reduce the cost of migratio, the report recommeded usig the existig desigated aalogue trasmittig sites ad ifrastructure for digital trasmissio. 86 The iitial strategy was for SIGNET to be fully fuded by the govermet to provide sigal distributio services durig the simulcast period, carryig the aalogue broadcasters o its digital platform for free. However, i 2011, followig the slow pace of digital ifrastructure deploymet due to costraied ad iadequate fudig from the govermet, the DTC recommeded the licesig of a private sigal distributor, resultig i the cotested licece teder described previously ad, ultimately, the award of a BSD licece to PANG. The licesig of PANG resulted i the commecemet of deploymet of DTT ifrastructure i cities outside Nairobi. 80 Media Owers Associatio of Keya, Letter, Cocer over digital migratio date ad the eed for affirmative actio for Keyas ad for the Keya Media, at 1, Oct. 23, The MOA disagreed with the estimate, statig that there were o more tha 60,000 FTA-oly STBs i the coutry. 81 CA, Quarterly sector statistics report, Fourth quarter for the fiacial year , Obam, D. (2016, October 12). iterview. 82 allafrica, Keya Meets Global Digital Migratio Deadlie, Jue 25, 2015, available at All Africa, Keya: CCK has licesed 20 set top box vedors, Dec. 1, 2012, available at 83 CA, Uderstadig Migratio from Aalogue to Digital TV Broadcastig i Keya, at 15, available at See also TechMagKE, Top 7 Free to Air Decoders i Keya Right ow, Sept. 17, 2015, available at Other examples idicate the price of a FTA STB to be betwee KES 2,000-2,500 ad a pay TV STB to be betwee KES 1,200-1, I additio to various pay TV providers usig promotios to sell STBs, STBs are beig budled with o-tv services. For example, the Big Box sold by Safaricom is KES 4,999 ad icludes 3 GB of data services, available at 85 Obam, D. (2016, October 12). iterview. 86 Report of the Task Force, Sectio 4.5.

28 Digital Migratio Process i Keya 26 Uder the framework established by CA, the broadcasters must pay a cost-based, CA-determied utilisatio fee per site to SIGNET ad PANG. I additio, SIGNET is still receivig fudig from the govermet after the completio of the migratio i order to expad digital televisio coverage to areas that previously lacked eve aalogue coverage. 87 Broadcasters do ot receive ay subsidies uder the migratio for the developmet of cotet delivered over the digital platform because they are ot required to provide distributio services ad expad distributio coverage. 88 This is cosistet with the practices of other coutries that elected to employ public BSDs (e.g., Tazaia, which established a PPP to fud a public BSD). 89 CA, however, plas to use the Uiversal Service Fud (USF) to provide fudig to broadcasters to rollout commuity televisio statios ad local cotet to margialised commuities. 90 Other coutries have used part of the licece fees with the auctio of the repurposed digital divided to help fud the digital migratio, icludig etwork deploymet ad subsidies for the acquisitio of STBs. This approach should be cosidered carefully, as it may egatively impact the fial price of those licece fees Additioal Expeses CA s expeses also icluded fudig the Digital Keya secretariat, payig sittig allowaces for members of the Migratio Task Force ad the DTC, ad sposorig capacity buildig workshops for creative artists. 91 The govermet recogised that CA fudig was ot sufficiet for all of the activities. 92 I terms of fudig from o-govermet sources, the migratio pla also expected that other stakeholders, such as the media compaies, would provide support for iitiatives such as awareess campaigs. This support came as some broadcasters, icludig the KBC, provided free airtime for ads regardig the migratio ad coducted iterviews to members of the DTC Legal Challeges After the govermet s award of the BSD licece to PANG, the digital migratio process was subject to three legal challeges: (i) a admiistrative appeal by certai broadcasters; (ii) a lawsuit brought by a cosumer associatio; ad (iii) a lawsuit filed by three broadcasters before the High Court, which was subsequetly appealed to the Court of Appeal ad the Supreme Court. The legal challeges surroudig the BSD licesig process delayed the digital migratio process for almost three years. Additioally, the court cases geerated sigificat legal ucertaity util they were resolved. I particular, PANG s licece was cacelled by the Court of Appeal ad the reistated by the Supreme Court, ad CA s authority to issue BSD liceces or for the Compaies to receive such liceces was uclear util the Supreme Court rulig Challege before the PPARB The first legal challege was filed i Jue 2011, by the Natioal Sigals Network Ltd. Cosortium (comprised of broadcasters Royal Media Services Ltd. (RMS) ad Natio Media Group Limited (NMG)) with the Public Procuremet Admiistrative Review Board (PPARB). The parties were challegig the maer i which the regulator had admiistered the teder process ad awarded the licece to PANG. 94 They alleged that CA s decisio was based o cotradictory ad ambiguous teder documets ad that the documets did ot specify the period for which the security bod eeded to be valid. 95 The PPARB rejected this argumet, otig that the presetatio of a faulty security bod (it was valid for 59 days rather tha the specified 120 day period) by RMS ad NMG was a legitimate basis for disqualifyig them from the teder. 96 Ultimately, PPARB dismissed the complait, ad CA awarded PANG its licece i October At the begiig of the process, the lack of ifrastructure fudig caused more delays, especially i the iitial deploymets by SIGNET. As the migratio progressed, STB availability ad affordability were more sigificat. It was solved by market forces, ad a reductio of taxes ad fees, as outlied above. 87 Obam, D. (2016, September 23). iterview. 88 Media Owers Associatio (2016, September 13). Phoe iterview with Lyette Mwagi: see also Ugada, Miistry of Iformatio ad Commuicatios Techology, Digital Migratio Policy, at sectio 5.1.2, July 2011, available at policy.pdf. 89 ITU, Digital Migratio-Lessos from Tazaia, at 18, Jue, 16, 2015, available at 90 Stadard Media, Keya to fud commuity broadcasters, Sept. 30, 2015, available at 91 Commuicatios Authority of Keya (2016, September 9). Phoe iterview with Alfred Ambai, Assistat Director of Multimedia Services at CA. 92 Miistry of Iformatio, Commuicatios ad Techology (2016, September 27). Phoe iterview with Sammy Itemere, Pricipal Secretary. 93 Obam, D. (2016, October 12). iterview. 94 High Court at Nairobi, Petitio No. 557, of 2013, para PPARB, Cosolidated Review of No. 24/2011, at 9, available at 96 Id. at Brief to the Seate Committee, Sectio 2.5.

29 Mai Challeges ad Solutios Cosumer Federatio of Keya ijuctio The secod adjudicative delay occurred whe the Cosumer Federatio of Keya (COFEK) obtaied a ijuctive order i Jauary 2013, haltig the migratio due to the BSD teder process ot adequately represetig cosumer iterests. 98 COFEK argued it did ot have a platform to express ay cocers with the ASO because it was ot icluded i the DTC. 99 After the MICT agreed to make COFEK a member of the DTC, COFEK withdrew its petitio i Jue Broadcasters lawsuit The third ad most sigificat delay occurred whe three broadcasters, RMS, NMG ad Stadard Group Limited (SGL) (collectively referred to as the Compaies ) filed suit agaist the govermet i the High Court of Nairobi i November SGL did ot participate i the earlier admiistrative complait because it had ot participated i the BSD teder, but it joied RMS ad NMG i the litigatio. 102 At the time of the case, the Compaies held 85% of the viewership i the geographic area of broadcastig coverage i Keya. 103 The issues raised by the broadcasters were addressed by the High Court, appealed to the Court of Appeal, ad ultimately decided by the Supreme Court of Keya. High Court I the iitial complait filed before the High Court, the Compaies sought to obtai a court order gratig them a BSD licece. 104 They argued that their existece was legally protected uder the Costitutio ad their iability to obtai a BSD licece durig the digital migratio proceedig was a violatio of the freedom of the media ad the freedom of expressio. 105 I additio, the Compaies oted that because they had collectively ivested KES 40 billio i broadcastig ifrastructure, they had a legitimate expectatio that the govermet would ot iterfere i their broadcastig busiesses. 106 They accused CA of coductig the teder to assig BSD liceces i a opaque ad discrimiatory way ad igorig their ivestmets i broadcastig ifrastructure. 107 Further, the Compaies argued that CA lacked the legal structure, idepedece ad autoomy from govermet cotrol required to exercise authority over broadcastig uder the Costitutio. The Compaies asserted that these legal deficiecies ivalidated CA s ability to grat BSD liceces. 108 Govermet positio The govermet dismissed the argumet that its ivolvemet i BSD services dimiishes media freedom uder the Costitutio by arguig that such freedom is ot absolute ad that the Costitutio eables the licesig ecessary to regulate the airwaves ad other forms of sigal distributio areas, provided such licesig is carried out idepedet of govermet cotrol, political iterest, or commercial iterest. 109 It argued that the Migratio Task Force ad the DTC idepedetly performed careful policy aalysis of the implemetatio of the BSD licece scheme to esure icreased competitio ad cosumer choice i programmig while reducig the Compaies trasmissio costs. 110 Further, the govermet attempted to dissuade the court from issuig a BSD licece to the Compaies, otig that the court is ill-suited to make policy decisios. 111 Decisio ad Compaies respose O 23 December 2013, the High Court dismissed the Compaies complait, upholdig CA s authority to carry out the teder process ad award PANG a BSD licece. It cocluded that the Compaies were ot etitled to a BSD licece based o legal precedet or ay other legitimate expectatio, such as their prior etwork ivestmets i broadcastig ifrastructure. 112 The High Court also held that the digital migratio did ot violate the Compaies fudametal rights ad freedoms, or did the Compaies provide ay valid basis for the migratio process to be varied, delayed or stopped (See Box 2) COFEK, Letter from CA to Secretary Geeral of COFEK, para. 5, available at 99 COFEK, Letter from CA to Secretary Geeral of COFEK, para. 2, available at COFEK letter, Id. para. 4: High Court at Nairobi, Petitio No. 557, of 2013, 39. COFEK was added to the DTC but later resiged. Four additioal cosumer orgaisatios were subsequetly authorised to participate i the DTC. 101 High Court at Nairobi, Petitio No Court of Appeal, Judgmet of Nambuye, JA, para Id. para High Court at Nairobi, Petitio No. 557, para Id. para Id. para Id. para. 43, Id. para. 45, citig Access to the Airwaves, Priciples o Freedom of Expressio ad Broadcast Regulatio, Sectio 10, available at Id. para High Court at Nairobi, Petitio No. 557, para Id. para High Court at Nairobi, Petitio No. 557, para 97, Id. para. 136.

30 Digital Migratio Process i Keya 28 BOX 2: SUMMARY OF THE HIGH COURT DECISIONS High Court Decisio Ruled i favour of govermet Costitutioal rights or etwork ivestmets do ot etitle Compaies to BSD licece To protest the decisio, ad what they felt was a rushed migratio process, the Compaies switched off their aalogue trasmissios for two days. 114 A reported two millio households had their sigal shut off. 115 CA successfully compelled the Compaies to restore their service by sedig a otice iformig them that by ot broadcastig, they were i breach of their licece obligatios. 116 However, the restoratio of service was short-lived, as the Compaies were required to termiate their aalogue trasmissios six days later i order to comply with the 1 Jauary 2014 ASO deadlie. 117 Court of Appeal O 3 Jauary 2014, the Compaies filed a appeal with the Court of Appeal i Nairobi ad were grated a ijuctio o 4 February, prevetig CA from switchig off their aalogue sigals util the court could hear their case ad issue a decisio. 118 After a 35-day period where the aalogue sigal was shut off, the ijuctio allowed a temporary restoratio of trasmissio. Decisios i favour of Compaies The Court of Appeal was more sympathetic to the Compaies poit of view ad overtured the decisio of the High Court. I the decisio, the court delved deeper ito the issue of whether CA was idepedet of govermet cotrol ad whether the Compaies had a legitimate expectatio of beig grated BSD liceces due to their ivestmet i their etworks. 119 Regardig idepedece, the court cocluded that CA was ot idepedet ad that Parliamet had a duty to alter the structure of CA to alig it with the Costitutio. 120 The fidig of a lack of structural idepedece was based o the fact that Keya s presidet had authority to appoit CA s Chairma ad permaet secretaries. 121 As such, the Court of Appeal ruled that CA could ot make objective decisios ad therefore the BSD licece teder process was cacelled. 122 The Court of Appeal also determied that the Compaies had a legitimate expectatio of beig grated a BSD licece based o their extesive ivestmet i broadcastig ifrastructure. The court iterpreted the 2006 ICT Policy as a commitmet to allow the Compaies to retai the ivestmets made i their etworks. 123 Give its fidigs, the Court of Appeal ordered that the Compaies be issued a BSD licece ad cacelled PANG s BSD licece. I additio, pursuat to the court s decisio, certai modificatios were made to provide CA with greater idepedece ad to coduct the BSD licece teder process de ovo. Subsequetly, 30 September 2014 was established as the ew ASO deadlie (See Box 3) Brief to the Seate Committee, Sectio Jamboewspot.com NTV, KTN ad Citize switch off their sigal to protest digital migratio, Dec. 23, 2013, available at Id. Sectio Id. Sectio Id. Sectio Court of Appeal, Civil Appeal No. 4 of 2014, Judgmet of Musiga, JA, para. 69: Court of Appeal, Judgmet of Nambuye, JA, para. 152(6). 120 Court of Appeal, Judgmet of Maraga, JA, para. 81, 82, ad 89. The regulator s existece pre-dated the latest Costitutio, which was ratified i Court of Appeal, Judgmet of Nambuye, JA, para Court of Appeal, Civil Appeal No. 4 of 2014, Judgmet of Maraga, JA, para Court of Appeal, Civil Appeal No. 4 of 2014, Judgmet of Maraga, JA, para Court of Appeal, Judgmet of Nambuye, JA, para. 152.

31 Mai Challeges ad Solutios 29 BOX 3: SUMMARY OF THE COURT OF APPEAL DECISIONS Court of Appeal Decisios Ruled i favour of the Compaies Broadcasters have a legitimate expectatio to the grat of BSD licece due to their etwork ivestmets A idepedet regulator must grat BSD licece to broadcasters Supreme Court O 28 March 2014, the govermet appealed the verdict of the Court of Appeal to the Supreme Court. 125 Decisio i favour of Compaies The Supreme Court cosidered the determiatio of whether CA was idepedet of govermet cotrol as the mai issue uder discussio. The Supreme Court cocluded that CA was legally authorised to carry out the BSD licece teder despite the Costitutio s madate. The Court reasoed that although the regulator did ot have the exact structure required by the Costitutio, the Costitutio had bee drafted with CA i mid. RMS ad NMG o a techicality (i.e., the failure to comply with the security bod requiremets) was discrimiatory ad agaist the values of democracy, trasparecy, accoutability ad equity. The Supreme Court also reversed the Court of Appeal s rulig that the Compaies had a legitimate expectatio to be grated BSD liceces. The court reasoed that gratig the Compaies BSD liceces based o etwork ivestmets would usurp CA s authority ad cotravee the allocatio mechaism established by the law. The Supreme Court oted that the gratig of BSD liceces must be performed by a etity with the statutory power to do so, i.e., CA (See Box 4). However, the court also cocluded that the decisio to exclude RMS ad NMG from beig grated a BSD licece was out of lie with costitutioal values. 126 The court reasoed that excludig BOX 4: SUMMARY OF THE SUPREME COURT DECISION Supreme Court Decisio Cosider the merits of BSD licece applicatios from the Broadcasters Reistate the BSD licece assiged to PANG that was aulled by the Court of Appeal ad esure that PANG meets the foreig owership limit of 80% Set 17 Jue 2015 as the date for the aalogue switch-off CA was give 90 days to implemet chages accordig to the Supreme Court s rulig by cosiderig the merits of the Compaies BSD licece applicatios ad reistatig PANG s licece. 127 At the coclusio of the 90 days, the Supreme Court deemed that the regulator had made much progress towards compliace with the Court s rulig ad allowed CA to proceed with the ASO accordig to the regulator s timetable Supreme Court of Keya at Nairobi, Civil Applicatio No. 9 of 2014, Apr. 11, 2014, para SGL did ot participate i the origial teder for a BSD licece, ad as such were ot icluded i the Supreme Court s decisio regardig CA s exclusio of RMS ad NMG from the teder process. 127 Supreme Court of Keya, Petitio No. 14 of 2014, Feb. 13, Supreme Court of Keya, Petitio No. 14C of 2014, at 4, Ja. 5, 2015.

32 Digital Migratio Process i Keya 30 3 Keya i the Regioal Cotext Keya s digital migratio process ca be viewed withi a regioal cotext, as other coutries i East Africa were also plaig ad implemetig the digital televisio trasitio durig the same period, icludig Rwada, Tazaia ad Ugada. 129 The simultaeous migratio processes across coutries is useful for compariso ad bechmarkig purposes, ad eables aalysis of key issues. For example, as show i Figure 9, we ca see the differeces betwee proposed ad actual timelies for the migratio process i the regio. Notably, each coutry missed the iitial proposed deadlie for full trasitio. I Rwada ad Tazaia, the delay was approximately six moths compared to three years delay i Ugada ad Keya. FIGURE 9: PROPOSED AND ACTUAL TIMELINES FOR THE MIGRATION PROCESS IN DIFFERENT COUNTRIES Rwada Proposed Actual Ugada Tazaia Keya Time util ASO (years) Source: TMG research. 3.1 Actio Committees Aother poit of regioal compariso relates to actio committees. Each of the above-refereced coutries established multi-stakeholder committees to assist with the digital migratio process ( actio committees ). However, the success of these actio committees higed o how ivolved stakeholders were ad how the etire process was carried out. Keya, Rwada ad Tazaia foud splittig up their committee ito sub-groups to be helpful i terms of establishig successful plaig processes. For example, similar to Keya, Rwada split up its task force ito four sub-committees. These sub-committees focused o: (i) techical stadards ad spectrum maagemet; (ii) policies ad regulatio; (iii) busiess developmet ad public awareess, ad (iv) cotet developmet ad capacity buildig. 130 While Tazaia created sub-committees as well, the govermet further: (i) delieated multiple teams withi the sub-committees ad (ii) divided the timelie ito multiple stages i order to isolate ad fully meet the project s goals Ugada had its ASO i two phases, the first phase occurred before GE06 deadlie, ad the remaiig sites ASO was i November The Observer, J. B. Mutabazi, RURA, Commowealth Digital Broadcastig Switchover Forum 2015, Digital Broadcastig Case Study: Rwada, Tazaia Case Study: Creatig A Regulatory ad Licesig Eviromet for the Digital Switch over, Habbi Guze, Feb. 2014, available here.

33 Keya i the Regioal Cotext 31 For example, rather tha issue a regulatory framework immediately, the first documet that the Tazaia govermet released itroduced the cocept of DTTB ad explaied its advatages. This allowed stakeholders to uderstad the govermet s perspective ad provide their ow iputs, which fed ito the subsequet framework documets. This approach allowed for recommedatios to be based o mutual uderstadig. Additioally, the govermet held mothly stakeholder meetigs ad delegated the various plaig efforts to groups icludig the Natioal Steerig Committee ad Natioal Techical Committee for Digital Broadcastig. Commet periods were wove ito each stage with sufficiet time provided to allow stakeholders to offer iputs. I compariso, while the overall actio committee process proved effective i Keya, the cosultatio process was hampered by a lack of mutual agreemet i which all viewpoits were ot fully cosidered ad icorporated ito the framework. This is perhaps best illustrated by the litigatio surroudig the BSD licesig process. 3.2 Public Awareess Campaigs Public ivolvemet ad awareess are key compoets of digital migratio processes. I Keya, roles for the govermet, STB vedors, broadcasters ad the public were explicitly defied, which were iteded to create effective educatioal campaigs. 132 I particular, aoucemets o STBs ad the digital migratio were carried out through media such as traditioal ewspapers, televisio broadcasters ad through the STB vedors that were istructed to provide cosumers with detailed iformatio about their products. 133 May of these same outreach strategies were employed by both Tazaia ad Ugada. Tazaia bega its outreach strategy i 2010, providig iformatio through prit ad electroic media outlets, as well as semiars ad outdoor advertisig. Tazaia s outreach strategy focused o tailor-made material based o age ad social groups, icludig custom audio ad visual advertisemets. Tazaia eve differetiated betwee advertisemets made for the atio as a whole ad specific villages. 134 To create brad recogitio, Tazaia desiged a simple yet uderstadable digital logo ad used it i may of its campaigs. Ugada also emphasised the eed for all-ecompassig outreach campaigs, otig its ow failures with outreach. 135 This demostrates the importace of traditioal media i digital migratio outreach campaigs. 3.3 Set-Top Boxes The high cost of STBs was a issue ot oly i the East Africa regio, but also i may Wester digital TV migratios, icludig i the Uited States. The problem is more proouced i the East Africa regio because fudig costraits did ot allow for early as may customer subsidies. Istead, govermets icludig Keya sought to make STBs more affordable by reducig import taxes ad liberalisig the broadcastig markets to facilitate lower prices ad more competitio, as witessed i Keya. 136 The private sector also worked to boost adoptio by offerig STBs at the lowest possible price. STB affordability i the regio was also boosted by the Broadcastig Techical Task Force (BTTF) uder the East Africa Commuicatios Orgaisatio (EACO). The BTTF developed harmoised recommedatios for the regio o various techical aspects related to digital migratio, icludig miimum specificatios for STBs, which eeded to be validated by each idividual coutry. 137 These miimum specificatios were followed by Keya, as well as by Rwada, Ugada ad Tazaia. Although such iitiatives require additioal time ad resources, harmoisatio proved to have et beefits by facilitatig coordiatio amog eighbourig coutries, ad allowig the regio to take advatage of ecoomies of scale through a commo set of STB specificatios that drove dow costs. With respect to techology choices, Keya, Rwada, Ugada ad Tazaia all chose to switch to the DVB-T2 techology to take advatage of ecoomies of scale ad to help esure a more future-proof deploymet. 132 Digital Keya, Digital Migratio Stakeholders, Keya Miistry of Iformatio, Commuicatio ad Techology, Commuicatio Strategy for Migratio of Keyas from the Aalogue to the Digital Broadcastig Platforms, Adrew Kisaka, Digital Migratio Lessos from Tazaia by Adrew Kisaka, Ju. 2015, available here. 135 AllAfrica, Ugada: Steerig the Digital Migratio Jourey by Julius Busige, Jauary 18, 2015, Digital Migratio the Keya Experiece, Leo K. Boruett, Commuicatios Authority of Keya (2016, September 9). Phoe iterview with Alfred Ambai, Assistat Director.

34 Digital Migratio Process i Keya 32 I Rwada, Ugada ad Tazaia, the private sector also sought to boost sales by offerig discouted STBs, ad recoupig losses through mothly subscriptio rates. For example, StarTimes (a subsidiary of PANG) i Ugada, curretly offers STBs for a advertised price of UGX 8,000 (USD 2.38) with a mothly subscriptio fee of UGX 41,500 (USD 12.25). 138 As of July 2015, StarTimes had sold approximately 700,000 STBs i Ugada. I Keya, FTA STBs retail for betwee KES (USD 20-35) with o mothly subscriptio cost. As of Jue 2015, betwee 2.2 millio ad 2.3 millio STBs had bee sold i Keya (where there are 4.5 millio televisio sets). 139 Although the STBs ca be cosidered low-cost devices (compared to, say, mobile phoes), low wages ca still place them out of reach for may cosumers. For example, the average mothly wage i Keya i 2013 was USD 76, which meas that STBs would cost oe-third to half of the average mothly salary. 3.4 Litigatio Aother key area that ca be bechmarked i the regio relates to litigatio arisig from the digital migratio process. Examiig both completed ad ogoig cases across Africa, legal troubles ofte ted to arise from a lack of effective commuicatio betwee regulators ad the private sector. I Tazaia, the govermet desiged detailed ad methodical plaig stages, ad implemeted these phases with buy-i from all stakeholders. This helped avoid lawsuits from stakeholders that would have slowed dow the migratio process. Rwada had a similar outcome. I cotrast, the migratio processes i both Keya ad Ugada were delayed due to litigatio by multiple private stakeholders. I Ugada s case, a private citize sued the Ugada Commuicatio Commissio (UCC) i court over the legality of forcig citizes to pay for STBs i order to get services they previously received for free via a aalogue sigal. 140 Two weeks later, the court, after briefly orderig the UCC to cease the ASO, ruled i favour of the govermet because the court lacked the proper jurisdictio to issue such a order. While the case stalled the process for oly oe moth, it highlights the importace of public awareess campaigs, which could potetially have mitigated cocers over the requiremet to obtai a STB i order to view programmig broadcast digitally. Keya s legal battle started i earest i November 2013, whe, as previously discussed, several broadcasters filed suit i the High Court to cotest the BSD licesig process. The broadcasters successfully argued that the govermet awarded the BSD liceces improperly ad CA was required to cocede to the broadcasters demad that a third licece be awarded. 3.5 Fudig Mechaisms for fudig the digital migratio offer aother meas for bechmarkig i the regio. The trasitio of a etire atio s broadcast ifrastructure from aalogue to digital is a expesive udertakig requirig cosiderable fudig from both the public ad private sectors. Similarly, lack of adequate fudig has the potetial to create or exacerbate problems. I geeral, private sector fudig has allowed for ifrastructure developmet while govermet fuds paid for public outreach ad STB price reductios. Full, or eve partial, STB subsidisatio was ot a optio i this regio because subsidisatio is extremely expesive East Africa Busiess Week, Ugada Pay-TVs Jockey for Digital Switch, February 22, 2015, TechWeez, AND Set Top Boxes, What are Their Optios i the Market? By Eric Waiaia, Jue 10, 2015, Biztech Africa, Ugadas forced to Embrace Digital Migratio, July 9, 2015, Daily Moitor, Hurdles Remai o Path of Ugada s Digital Migratio Jourey, March 13, 2012,

35 Keya i the Regioal Cotext 33 I Keya, the govermet s decisio to solely licese oe statefuded BSD preseted a problem. SIGNET lacked KES 4 billio i fuds for ifrastructure deploymet. I additio, it eeded to fud the mid-stream chage to from DVB-T to DVB-T2 techology. Therefore, it tured to the private sector ad iitiated a teder process for a secod BSD licesee. The licece fee of KES 40,500,000 (roughly USD 450,000) paid by the ew BSD licesee, PANG, provided the govermet with additioal fuds. PANG, which offers service i ie Africa coutries, has leveraged its footprit to adopt a variety of fudig mechaisms i the regio, primarily related to STBs, icludig i Rwada, Ugada ad Tazaia. I Ugada, PANG subsidiary, StarTimes, promoted STB adoptio by offerig low-cost decoders ad low mothly subscriptio rates, as metioed i Sectio StarTimes adopted a similar approach i Rwada. 143 I Tazaia, StarTimes prompted STB uptake by supportig public awareess campaigs. I all four coutries, the exact values of PANG s ifrastructure cotributios were ot divulged, but those cotributios helped the coutries with the dissemiatio of STBs. 3.6 Summary Table 3 shows a regioal bechmarkig of Keya s actios, i compariso to other coutries i the East Africa regio. Table 3: Compariso of Keya ad East Africa Coutries TABLE 3: COMPARISON OF KENYA AND EAST AFRICAN COUNTRIES Coutry Aspects of Digital Migratio Digital Switch-O Status Set-Top Boxes Litigatio Actio Committees Tazaia Primarily from govermet, but PANG cotributed a modest amout to ifrastructure. Tazaia had the best public outreach, utilisig various mediums ad marketig tools. STB distributors lowered the price by offerig low upfrot costs ad makig up the differece through the TV packages purchased. Requires DVB-T2 techology. No major or otable cases. Most thorough ad egaged plaig committee. Stakeholders were fully egaged. Keya The majority of ifrastructure fudig came from PANG, with very little comig from the govermet. Primarily used TV commercials ad physical outreach, as well as social media. Rarely used radio ads. The govermet lowered import taxes ad promoted competitio by allowig more distributors to eter the market. Requires DVB-T2 techology. Three media groups sued the govermet because they did ot receive a broadcast licece. I the ed, they received a selfprovisioig licece. Established a actio committee, but ot all iput was treated equally. Ugada Fudig was primarily iteral, but PANG s ivolvemet is evidet although uclear. Similar public outreach method to Keya. STB distributors lowered the price by offerig low upfrot costs ad makig up the differece through the TV packages purchased. Requires DVB-T2 techology. The UCC was take to court over the legality of the aalogue switch-off. The court ruled i favour of the UCC. Established a multistakeholder task force without ay otable issues. Rwada Fudig was primarily iteral, but PANG's ivolvemet is evidet although uclear. Similar public outreach method to Keya. STB distributors lowered the price by offerig low upfrot costs ad makig up the differece through the TV packages purchased. Requires DVB-T2 techology. No major or otable cases. Established a Migratio Task Force with four subcommittees. 142 Vaguard, Nigeria s Digital Migratio Failure: Lessos from Tazaia by Price Osuagwu, Jue 24, 2015, New Times, With Techology; StarTimes has Made Digital Migratio Affordable,

36 Digital Migratio Process i Keya 34 4 Coclusios 4.1 Lessos Leared ad Results Achieved Keya s experiece, viewed idepedetly or i relatio to other East Africa coutries, shows that govermets must play a critical role i facilitatig the etire digital migratio process. The trasitio requires political commitmet from the highest levels of the govermet, while the policy framework should be flexible eough to allow regulators to defie ad adjust the regulatory framework as eeded to address market, cosumer ad techological realities. Furthermore, the buy-i of stakeholders ivolved i the digital migratio is key to avoidig litigatio. Experieces i Keya ad Tazaia show that a cosultative approach with all ivolved stakeholders helps to defie ad adjust the actios ad priorities. However, the stakeholders cocers must be ackowledged ad give proper cosideratio. If parties are made to feel that decisios are already made ad their iput is meaigless, the the cosultative process is ot likely to yield the positive beefits evisioed. Thus, meaigful cosultatio processes that give fair ad trasparet cosideratio to stakeholders views are critical to avoid or limit litigatio or disruptio of the plaed migratio timelie. However, despite the difficulties i its cosultative process, Keya reacted promptly ad made the ecessary adjustmets to meet its fial ASO deadlie. The developmet of a clear ad detailed ASO roadmap for the digital migratio process is essetial, takig particular care to make sure it covers the etire migratio process. The migratio process should also be well-advertised with a comprehesive cosumer awareess campaig that explais the beefits of digital televisio i order to icetivise cosumers to ivest i ew receivers. Keya s mid-stream chage from DVB-T to the DVB-T2 stadard, although techically preferable, led to misiformatio ad cosumer cofusio. Cosumers should be aware of the process ad its timelies. The best outreach varies from coutry to coutry, but i geeral, it should iclude the use of diverse media with the widest reach possible. The migratio is a costly process, requirig ivestmets from both broadcasters ad cosumers, but it also has sigificat beefits. I Keya, there have bee positive chages i the broadcasters busiess models because, as a result of the creatio of BSDs, they o loger eed to focus o ifrastructure ivestmet. Istead, broadcasters ca focus o cotet productio. This opes the broadcastig market, as ew etities, such as the BSDs, are allowed to ivest i digital etwork deploymet. That said, this approach may ot be valid for all coutries, ad it is depedet o the size ad compositio of the broadcastig market. Special attetio should be paid to the impact o cosumers, otably the affordability of STBs. Although it is beeficial, subsidisig digital TV receivers for cosumers is ot always viable. Keya sought to address the fudig problem by opeig the STB market, facilitatig imported devices, egagig i regioal harmoisatio to leverage ecoomies of scale, ad reducig taxes ad regulatory fees. As is the case i several East Africa coutries, FTA sigals could also be received through pay TV STBs. Although this optio helps to brig more STBs ito the market, it may lead the geeral public to thik that the digital migratio meas also chagig from a FTA to a pay TV model. Keya has ot subsidised the STBs, but it is curretly cosiderig, if the regulatory framework permits, to use the USF as a tool for reducig STB costs for those uable to afford them, as well as to support deploymet solutios for remote areas, as market ad regulatory measures aloe did ot achieve full STB coverage objectives. A less utilised optio for improvig STB affordability is egotiatig cosumer STB fiacig optios with baks, icludig micro-fiacig optios, used by the pay TV operators i Keya. To the Keya govermet, the digital migratio has bee a tremedous success as the media sector has bee opeed up to may more players, creatig more busiesses ad jobs i the process. This has also icreased the diversity of cotet ad competitio, resultig i lower advertisig rates. I additio, valuable spectrum has bee freed from broadcastig services, to be used istead for mobile services such as 4G, creatig additioal socio-ecoomic beefits for Keya citizes. 144 Fially, the beefits from the digital migratio go far beyod the improved quality ad availability of televisio sigals, as it also icreases efficiecy i the use of spectrum. Both digital divideds should be made available for mobile broadbad, ad appropriate cosideratios should be take i terms of avoidig iterferece. Regioal ad iteratioal bad plas should be used i the digital divided bads i order to beefit from ecoomies of scale ad reduce potetial for iterferece i border regios. A clear migratio path, as well as a timelie for the assigmet of this spectrum should also be uder the purview of the coutries goig through the digital migratio. Overall, the results of a successful digital migratio help to reduce the digital divide i accessig both media ad mobile broadbad services. 144 Commuicatios Authority of Keya (2016, September 9). Phoe iterview with Alfred Ambai, Assistat Director.

37 Coclusios Checklist for Coutries Udertakig a Digital Migratio Process Table 4 is a checklist of key issues that a coutry should address whe udertakig a digital migratio process, based o Keya s digital migratio experiece. The checklist icludes the steps that should be carried out by both the govermet ad the private sector. TABLE 4: KEY ISSUES TO ADDRESS ON A DIGITAL MIGRATION Policy ad Regulatio Plaig DSO Deploymet Migratio ASO Fialisatio Commitmet from the govermet to spearhead the process, ad defiitio of orgaisatioal structure. Delegate a etity to lead the process through a executive order, i.e., the regulator. Establish a multi-stakeholder group to maage the implemetatio of the digital migratio. Review existig legal framework to allow for flexible regulatio. Defie broad policy guidelies, allowig for regulatory flexibility.. Develop appropriate policies o the access to, use of, ad distributio of cotet, icludig possibility of DTT pay TV provisio. Cosider itroducig Pay TV i the digital televisio bads as part of the migratio Istitute commo STB specificatios ad use licece fees from Pay TV providers to help subsidise receivers. Esure cosumers kow they are ot beig forced to switch from FTA to pay TV. Implemet a phased aalogue switch-off. Focus resources ad implemet ay correctioal actios whe ecessary. Take digital ifrastructure deploymet ad availability of digital TV receivers ito accout throughout the process. Cosult ad ivolve all key stakeholders, icludig govermet, regulator, broadcasters, equipmet maufacturers ad cosumer associatios. Establish clear guidelies ad commuicatios chaels for all stakeholders, i order to prevet misuderstadigs Establish a digital TV regulatory framework. Update broadcastig regulatios to iclude provisios for digital TV. Create a clear mechaism of trasitioig existig players to the digital platform as well as trasparet licesig for ew players. Where applicable, set the role of the public broadcasters i the trasitio. Allow public broadcasters to lead the deploymet of digital etworks, provided they have adequate fuds. Determie ad eforce the aalogue switch-off timelies. Make adjustmets throughout the migratio, as delays i the ASO deadlies lead to public cofusio. Provide regulatory certaity to allow ivestmets to flourish. Pla ad set aside fuds to carry out the process. Estimate the ecessary fuds for etwork deploymet ad acquisitio of receivers, ad idicate sources of fudig. Defie clear timelies for the digital switch-o ad the aalogue switch-off, icludig the simulcast period. Cosider how log may coutries took to meet the GE06 deadlie of 2015 ad pla accordigly. Commitmet from the govermet to spearhead the process, ad defiitio of orgaisatioal structure. Delegate a etity to lead the process through a executive order, i.e., the regulator. Commitmet from the govermet to spearhead the process, ad defiitio of orgaisatioal structure. Delegate a etity to lead the process through a executive order, i.e., the regulator. Set aside full fuds based o the estimatio, prevetig fiacial setbacks i the future. Accout for a simulcast period, which rages from 5 to 10 years. Establish a multi-stakeholder group to maage the implemetatio of the digital migratio. Establish a multi-stakeholder group to maage the implemetatio of the digital migratio. Determie adequate simulcast period. Determie how much time is eeded for the broadcasters to deploy etworks i differet parts of the coutry. Cosider the speed at which the idustry ca build ad sell digital TV receivers.

38 Digital Migratio Process i Keya 36 TABLE 4: KEY ISSUES TO ADDRESS ON A DIGITAL MIGRATION (CONTINUED) Techical Plaig DSO Deploymet Migratio ASO Fialisatio Obtai commitmet from broadcasters to ivest i ad deploy the ew etworks. Decide if BSDs should be separate etities from cotet creators If so, determie how may liceces should be awarded Defie the miimum specificatios for digital TV receivers, icludig STBs ad itegrated receivers. Set miimum STB specificatios early i the process. Adopt widely used regioal or iteratioal stadards ad specificatios, which may allow for the exploitatio of ecoomies of scale. Streamlie traiig of techical ad cotet creatio persoel o ew digital techology. Ivest i the etire productio supply chai icludig traiig, ew equipmet ad cotet productio. Pla ad set aside fuds to carry out the process. Cosider whether the DVB-T2 stadard with MPEG 4 compressio, as recommeded by the ATU, is appropriate. Pla digital TV frequecy chael assigmet, usig Sigle Frequecy Networks (SFN) or Multi-Frequecy Networks (MFN), ad optimise spectrum use. Deploy SFN where viable ad combie with MFN to guaratee maximum spectrum use. Determie locatios to carry out trials for the aalogue switch-off. Coduct trials i big ad small markets to assess public reactios ad possible issues. If ecessary, specifically carry out trials i small markets, to determie what adjustmets should be made. Cosider iteratioal harmoisatio o the use of spectrum to avoid itra- ad cross-border iterferece. Follow GE06 guidace o chael plaig. Hold cross border frequecy coordiatio meetigs with eighbourig coutries ad regioal orgaisatios. Require a miimum umber of digital cotet chaels per frequecy chaels, either i stadard defiitio (SD) or high defiitio (HD). Whe cosiderig usig SD chaels, utilise a maximum of 20 cotet chaels per oe 8MHz chael. Commitmet from the govermet to spearhead the process, ad defiitio of orgaisatioal structure. Delegate a etity to lead the process through a executive order, i.e., the regulator. Establish a multi-stakeholder group to maage the implemetatio of the digital migratio. Commitmet from the govermet to spearhead the process, ad defiitio of orgaisatioal structure. Delegate a etity to lead the process through a executive order, i.e., the regulator. Establish a multi-stakeholder group to maage the implemetatio of the digital migratio. Defie clear fudig mechaisms for ifrastructure rollout. Use a mix of private ad public ivestmets, alog with other forms of fiacig, icludig USF (if available) ad spectrum auctios. Provide govermet fudig from the public broadcaster if fuds are available.

39 Coclusios 37 TABLE 4: KEY ISSUES TO ADDRESS ON A DIGITAL MIGRATION (CONTINUED) Cosumer Plaig DSO Deploymet Migratio ASO Fialisatio Pla for ad allocate fuds for marketig for cosumer educatio ad awareess of the migratio process, its timelies ad implicatios. Pla cosumer awareess iitiatives, ivolvig all stakeholders Utilise multiple types of media ad iitiatives, especially media advertisemets Acquire fudig from the private sector, ot just the govermet. Icetivise idustry to promote ad explai the services to customers. Lauch iitiatives to promote digital televisio ad aswer cosumer questios at poits of sale receivers. Fiace cosumer awareess campaigs to prevet trasitio delays. Execute campaigs o several media chaels to reach the etire populatio. Ecourage broadcasters to utilise their chaels i educatioal efforts, as it will help miimise viewership declies after the trasitio. Pla the supply of a adequate umber of digital TV receivers. Ope the market to several digital TV receiver providers. Reduce taxes ad fees o receivers. If ecessary, defie the role of pay TV providers i the distributio of FTA digital TV receivers. Pay TV operators may provide both pay ad FTA STBs through a miimum set of specificatios. Have a clear message whe usig this approach to avoid licece issues with broadcasters, as well as misiformatio to cosumers that the migratio meas movig from FTA to pay TV. Provide assuraces of availability, ad accessibility of affordable digital receivers ad STBs, as those eed to be readily available i the local market. Carry out educatioal campaigs with STB vedors, broadcasters ad etwork ifrastructure vedors. Defie resposibilities i terms of messagig to cosumers. Coordiate efforts from a cetral poit, esurig a uiform message Develop a website with all iformatio about the process easily accessible. Esure that the populatio ca afford the acquisitio of a digital TV receiver. Oe optio is to establish receiver subsidies whe fuds are available, cosiderig that processig the subsidies may add extra time to the migratio process Aother optio is to cosider market forces icludig opeig the market to more vedors ad reducig taxes ad fees o digital receivers.

40 Digital Migratio Process i Keya 38 TABLE 4: KEY ISSUES TO ADDRESS ON A DIGITAL MIGRATION (CONTINUED) Spectrum Repurpose Plaig DSO Deploymet Migratio ASO Fialisatio Hold stakeholder forums to build cosesus o the aalogue switch-off process. Idetify challeges ad build cosesus amog stakeholders, avoidig future litigatio. Focus o log-term plaig for future spectrum use. Cosider usig spectrum licesig fees from the digital divided as a source of fudig for the migratio. Defie clear timelies whe implemetig the framework ad strategies for the use of the ew services i the digital divided. Clearly defie the differet phases of the migratio process. Idicate whe licesig the repurposed spectrum will coclude. Clear the digital divided spectrum i the 800 MHz ad 700 MHz bads. Free the 700MHz bad for other services by allocatig broadcastig services to frequecies below 694MHz Defie mobile services bad pla i accordace with regioal ad iteratioal stadards. Follow harmoisatio plas as established by stadards developmet orgaisatios, i order to have ecoomies of scale, ad more accessible devices (Example: the ITU-R recommedatio for chael arragemets i the 700 ad 800 MHz bads). Aalyse existig televisio broadcastig market i the coutry, icludig availability of trasmitters ad STBs, to defie realistic goals i terms of spectrum refarmig timelies. Create timelies that balace demad for digital divided spectrum with realistic etwork deploymet schedules ad availability of digital TV receivers. Repurpose the spectrum for ew services, icludig mobile broadbad. Licese ew services i the Digital Divided.

41 Coclusios 39

42 Digital Migratio Process i Keya 40 Appedix A: List of Acroyms Term APA ASO ATU BSD BTTF CA CCK COFEK DSO DTC DTT DTTB DTV DVB-T EACO FTA HD ITU KBC KES KICA LTE MFN MICT MOA NCS NMG PANG PPARB PPP RMS RRC SD SFN SGL STB UCC UGH UHF USF VHF WRC Meaig Associatio of Practitioers i Advertisig Aalogue Switch-Off Africa Telecommuicatio Uio Broadcast Sigal Distributor The Broadcastig Techical Task Force Commuicatios Authority Commuicatios Commissio of Keya Cosumer Federatio of Keya Digital Switch-O Digital Trasitio Committee Digital Terrestrial Televisio Digital Terrestrial Televisio Broadcastig Digital Televisio Digital Video Broadcastig Terrestrial East Africa Commuicatios Orgaizatio Free-to-Air High Defiitio Iteratioal Telecommuicatios Uio Keya Broadcastig Corporatio Keya Shillig Keya Iformatio ad Commuicatios Act Log-Term Evolutio Multi-Frequecy Networks Miistry for Iformatio ad Commuicatios Media Owers Associatio Natioal Commuicatios Secretariat Natioal Media Group Limited Pa Africa Network Group Public Procuremet Admiistrative Review Board Public Private Partership Royal Media Services Ltd. Regioal Radiocommuicatio Coferece Stadard Defiitio Sigle Frequecy Networks Stadard Group Limited Set Top Box Ugada Commuicatio Commissio Ugada Shillig Ultra High Frequecy Uiversal Service Fud Very High Frequecy World Radiocommuicatio Coferece

43 Appedix A: List of Acroyms 41

44 Digital Migratio Process i Keya 42 Appedix B: Status of GE06 Coutries TABLE 5: STATUS OF GE06 COUNTRIES THAT HAD NOT COMPLETED ASO BY 2015 Coutry Digital Switch-O Status Albaia Jue 6, 2015 Ogoig Algeria 2015 Ogoig Agola Ogoig Armeia 2015 Ogoig Azerbaija 2013 Ogoig Bahrai Jue 17, 2015 Ogoig Belarus 2015 Ogoig Bei 2020 Ogoig Bosia ad Herzegovia Jue 17, 2015 Ogoig Botswaa Ogoig Burkia Faso December 30, 2015 Ogoig Burudi Ogoig Cameroo 2015 Ogoig Cape Verde August 31, 2016 Ogoig Cetral Africa Republic Not started Chad Ogoig Comoros Not started Cogo Ogoig Cogo (Dem. Rep.) Ogoig Côte d'ivoire 2015 Ogoig Djibouti Not available Egypt Jue 17, 2020 Ogoig Equatorial Guiea Ogoig Eritrea Not started Ethiopia 2017 Ogoig Gabo Ogoig Gambia September 30, 2015 Ogoig Ghaa Jue 17, 2014 Ogoig Guiea Ogoig Guiea-Bissau March 31, 2016 Ogoig Ira Ogoig Iraq Not available Jorda 2015 Not available Kazakhsta 2015 Not available Kuwait Not available Kyrgyzsta Not started Lebao 2015 Not started

45 Appedix B: Status of GE06 Coutries 43 Lesotho 2015 Ogoig Liberia Not started Libya Not started Liechtestei Not available Madagascar 2015 Ogoig Mali Jue 30, 2016 Ogoig Mauritaia Not available Mauritius July 17, 2015 Ogoig Moldova Jue 15, 2015 Ogoig Namibia 2016 Ogoig Niger April 30, 2016 Ogoig Nigeria Jue 17, 2015 Ogoig Oma Jue 17, 2015 Ogoig Qatar Ogoig Romaia Jue 17, 2015 Ogoig Russia 2019 Ogoig Sao Tome ad Pricipe Not started Seegal 2015 Ogoig Seychelles December 31, 2015 Ogoig Sierra Leoe December 31, 2017 Ogoig Somalia Not available South Africa December 31, 2013 Not started South Suda Ogoig Suda 2015 Ogoig Swazilad Ogoig Syria 2020 Not available Tajikista Not available Togo Ogoig Tuisia 2015 Ogoig Turkey 2015 Not started Turkmeista Not available Ugada Ogoig Ukraie 2015 Ogoig Uzbekista 2017 Ogoig Yeme 2020 Not available Zambia 2014 Ogoig Zimbabwe 2015 Ogoig Source: ITU Status of the Trasitio to Digital TV visited o 13 Oct

46 Digital Migratio Process i Keya 44 Appedix C: Techical Cosideratios of Keya s Digital Migratio The frequecy pla for Keya, as cotaied i the GE06, was based o a Multiple Frequecy Network (MFN) pla. Deploymet of DTTB was o a mii Sigle Frequecy Network (SFN) withi the MFN pla. BSDs deployig multiple SFN trasmitters i a give service area o the same frequecy had to submit their cofiguratio for approval by CA. 146 Durig the simulcast period, the BSDs were assiged frequecies that were ot i use by aalogue televisio trasmitters, based o the GE06. This approach made broadcastig spectrum more orgaised ad idetificatio of available spectrum easier. I the begiig, it was possible to multiplex most of the existig aalogue chaels programmes i oe digital televisio chael. Durig the trasitio period, may of the aalogue frequecies were still i use ad oly a few digital chaels were available. After the trasitio period, more chaels became available ad ew requests for broadcastig cotet could be met. 147 The followig poits were take ito cosideratio whe plaig the assigmet of digital chaels: compliace with GE06; requiremet of coordiatio with eighbourig coutries; existig aalogue frequecy chaels; ad likelihood of iterferece. The DTC recommeded that, whe usig MPEG-4 compressio, eight digital cotet chaels could be accommodated withi oe 8 MHz frequecy chael. 148 Figure 10 shows the cities i which each of the two BSDs had deployed their etworks i Keya. As part of the chage from the DVB-T to DVB-T2 stadard, STB imports were required to comply with the Govermetapproved DVB-T2 system specificatios. Some of these miimum requiremets are show i Table FIGURE 10: DIGITAL SIGNAL AVAILABILITY Webuye Kisumu Kisii Nakuru Eldoret Meru Nyeri Nairobi KBC PANG Malidi Mombasa Source: Digital Keya, November Alfred Ambai, at Obam, D. (2016, September 23). iterview. 148 Id. 149 Public Notice. 150 Digital Keya,