There seems to be no end in sight over the tussle between the Consumer Protection Council (CPC) and Multichoice Nigeria Limited (operators of DStv and GOtv) over subscription fee hike of cable television services.
In recent years, CPC has been inundated with complaints from consumers on services being rendered by Multichoice, chief among them the refusal of the company to offer pay-as-you-go billing on both DStv and GOtv.
Details obtained from the CPC indicated that consumer complaints included failure to receive signal after subscription paid; subscription disconnection prior to end of billing cycle with no credit applied for paid time lost; lack of clarity in terms and conditions; non-activation of free to air channels except when a consumer complained and confusing toll-free customer care telephone channels.
Others included arbitrary charges; confusing billing; blocking some channels already subscribed; poor picture or signal quality with excessive and un-compensated downtime during both inclement and clear weather conditions and lack of responsiveness.
“A significant number of complaints characterized Multichoice’s cost, billing and attitude as exploitative and obnoxious, including alleged disparities and disparate treatment in cost and treatment of consumers in other countries where Multichoice operates,” the CPC said.
In 2015, the then Director General of the CPC, Mrs. Dupe Atoki, began investigating consumer complaints and concluded the investigation on February 16, 2016.
As a result of the investigation, CPC issued certain orders to the paid TV provider, including allowing some free channels on DStv and GOtv as well as adding more sports channels on GOtv.
“Despite the previous investigation and orders, consumer complaints did not abate; as a matter of fact, complaints increased in number and scope. Specifically, many customer care issues that were subject of the previous investigation and orders appeared to become more incessant,” the current Director General of the CPC, Babatunde Irukera, stated in a recent statement.
Daily Trust learnt that increased complaints necessitated a broad investigation by the council which started on November 7, 2017.
In addition, the House of Representatives on account of incessant complaints from constituents, conducted a hearing, and resolved that the council intervened to address the complaints, identifying the question of arbitrary charges and treatment of consumers in Nigeria compared with other locations, as well as the question of whether Multichoice was complicit in suppressing competition in Nigeria.
Section 2(i) of the Consumer Protection Council Act (CPCA) mandates the CPC to “provide redress to obnoxious practices or unscrupulous exploitation of consumers”.
Irukera said the investigation, or the council, did not intend to regulate price, or in any way interfere with the commercial interface between Multichoice and its customers in fixing price.
“The council recognises and respects the fidelity in the operation of free market forces in arriving at prices for goods or services. The council understands and appreciates that price is an acceptable determination of transparent and undistorted market operations.
“However, it is the law, that operators can by conduct, distort the market and, or otherwise compromise the integrity or transparency of the market, thereby questioning the reliability of the pricing methodology or mechanism,” he said.
A major concern in Nigeria is the absence of a competition or anti-trust legislation and regime, which would have been best suited to handle the case. However, CPC believes the case could be weighed under consumer protection principles that are generally expressed or sometimes derived from existing consumer protection legislation such as Section 2(i) of the CPCA.
The section provides that in any inquiry under the Consumer Protection Act, the question must be whether any entity or individual has engaged in conduct that constitutes an “obnoxious practice”, or “unscrupulous exploitation”.
“If any conduct is declared to be these, and such conduct has sufficiently distorted the market and redounded to the benefit of an entity or person at the expense of consumers, the objective, and or outcome of such conduct, is necessarily suspect and implicated under law whether it is price, market share, appearance, name or other features of a commodity or service,” the CPC said.
Over a period of time, during which mutual concerns and reservations were addressed, the council and MultiChoice agreed and adopted a Proposed Mutual Joint Consent Order.
The terms and obligations included an unopposed and undisputed requirement and understanding that Multichoice will not change, revise or modify any material term or conditions of service(s) for a period of 24 months.
The CPC said Multichoice never expressed any concerns or dissatisfaction with this clause of the Consent Order that required it to maintain status quo on its Terms and Conditions (which naturally includes pricing) for the 24-month period during which the company would have been under the council’s supervision, to ensure that all measures were adequately implemented, and that consumers eventually get expected value for their money.
The council expressed concern that while waiting for, and when execution was imminent, Multichoice, without consultation or notice, and in violation of the spirit of collaboration and the finalized draft Proposed Mutual Joint Consent Order, by text messages to consumers, announced an increase in prices which materially changed a term of its service.
In July, Multichoice increased the subscription rate for the DStv packages, including raising Premium Package from N14,700 to N15,800, Compact Plus from N9,900 to N10,650 and Compact from N6,300 toN6,800.
“The council conveyed its strong disapproval to Multichoice’s conduct as it amounted to bad faith, undermined both the council and its regulatory process. Multichoice’s failure to reconsider its decision, or honour its expressed and negotiated commitment made it impracticable in the absence of judicial process to sufficiently protect consumers and accomplish the vital provisions of the Proposed Mutual Joint Consent Order,” CPC also stated.
It was this development that led to a court case in which the Federal Government filed an action under prevailing law to restrain Multichoice hiking prices.
On August 20, 2018, Justice Nnamdi Dimgba issued an order in Case No FHC/ABJ/CS/894 to prevent Multichoice from executing the price hike
“With the Interim Injunctive Order of Justice Nnamdi Dimgba, it is a violation of the order of a court for Multichoice to require consumers to pay, or to receive any new rate for their services from consumers.
“For clarity, the current, valid and prevailing rate for DStv and GOtv services are the rates that were effective as at July 31st, 2018,” the CPC stated.
Multichoice is yet to react to the latest court order and it remains sketchy whether or not it would go ahead to enforce the subscription fee hike.
However, it can be recalled that in February 2016, Multichoice’s Managing Director, John Ugbe, announced 50 per cent reductions in the prices of its decoders.
Ugbe said, “One of Multichoice’s key priorities is to put our subscribers’ needs at the heart of everything we do and since these have been tough economic times for everyone, we realized that our subscribers could use some good news.”
