South African province's annual payment of $3 million to CNBC Africa creates, unsurprisingly, controversy.
Posted: 02 Apr 2010
"It has emerged in the last week that CNBC Africa, the business channel launched in June 2007 as a local offshoot of the respected CNBC brand – whose owner is the giant US network NBC Universal, one-time home of such journalistic luminaries as Tim Russert and Tom Brokaw – has been receiving US$3-million a year from the Gauteng [province of South Africa] government. ... Why ... were the CNBC payments made? 'That’s a very good question. Nobody has given me an answer to it. It doesn’t make sense, there’s no reason. It certainly doesn’t build an independent film industry.' ... Then there’s the question of CNBC Africa itself. A cloud now hangs over the editorial integrity of the broadcaster, whether it admits to it or not. ... [T]he key interview on CNBC Africa’s launch night in June 2007 was with President Thabo Mbeki. Those were tough months for the former president, his Machiavellian war with Jacob Zuma was approaching the final battle, and he wasn’t saying much to the press – and yet his minions were so pleased with the CNBC Africa appearance that a transcript was posted to the official website of the presidency." Kevin Bloom, The Daily Maverick (Johannesburg), 31 March 2010. Refers to statement of the South African Screen Federation, 27 March 2010.
"MD of Avusa local business channel Summit, Vernon Matzopoulos, yesterday called for a probe into Gauteng’s 3m annual contract with international business channel CNBC Africa, saying it was 'scandalous that taxpayers have been funding a commercial TV venture'. Avusa is a part-owner of Business Day publisher BDFM." Chantelle Benjamin, Business Day (Johannesburg), 1 April 2010.
"The Gauteng Economic Development Department said on Wednesday it could not say whether a contract to give business TV channel CNBC R20m a year was illegal. It does say however that it received a legal opinion that the contract was not consistent with the Public Finance Management Act. The province confirmed earlier this week it had stopped the funding three years after making its first payment. CNBC Africa said it would not comment on the issue at this stage." Stephen Grootes, Eyewitness News (Johennesburg), 1 April 2010.
"In the [Gauteng Film Commission's] 2009 annual report, the following explanation is provided: 'Since the establishment of the studios of CNBC Africa in Johannesburg, a number of benefits have accrued to the Province as a result of the agreement, notably foreign direct investment in the media and broadcast industry, the creation of more than 130 jobs as well as a content partnership which has resulted in significant global exposure given to the Province and the work of the provincial government. In signing the agreement the GFC has provided a guarantee to CNBC Africa, which ensures a minimum annual advertising income in support of the establishment of its studios.' It reads a bit like an agreement between the state and a public broadcaster, which CNBC Africa isn’t." Kevin Bloom, The Daily Maverick, 31 March 2010.
"Head of the Media and Motion Picture unit of the [Industrial Development Corporation of South Africa] Basil Ford, a big investor in CNBCA, says he isn't aware of any requests for funding from CNBCA. He believes that the channel is sustainable even without the $3m per annum. He explains that if the IDC received a request, they would have to look at it. So for now it looks like CNBCA is still on the air." Chris Blaine, Moneyweb, 30 March 2010.
"'This was a five-year contract and it guaranteed CNBC Africa revenue of $3m a year in the event that both the GFC and CNBC Africa are unable to attract sufficient advertising revenue agreed upon by the two parties,' said [Gauteng economic development spokesman Mandla] Radebe. He said no amount was paid to CNBC Africa for the cancellation." Sibongakonke Shoba, Business Day, 30 March 2010.
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