MultiChoice and consumer choice

On March 3, MultiChoice announced a 20 per cent hike in its subscriptions fees for all its bouquets with effect from 1 April. The company said that the price increase was necessary for it to continue to offer the best service in local and international entertainment to its subscribers. Two lawyers, on behalf of themselves […]

On March 3, MultiChoice announced a 20 per cent hike in its subscriptions fees for all its bouquets with effect from 1 April. The company said that the price increase was necessary for it to continue to offer the best service in local and international entertainment to its subscribers.
Two lawyers, on behalf of themselves and all subscribers in Nigeria, took the class-action suit against MultiChoice, asking for an order to compel NBC to enforce the pay-per-view scheme by which subscribers would only pay for programmes watched, which they said was the practice in other parts of the world.
They also asked for an order to restrain any other individual or corporate entity from filing any other action on the subject matter to avoid multiplicity of lawsuits.
They equally want the court to ask MultiChoice to render account of all excess tariffs with the particulars of such subscribers and crediting their account against the next renewal and/or remitting such excesses back to the customers.
Justice C.J. Aneke gave an interim order on April 2 that MultiChoice should revert to its old subscription rates pending the determination of the suit on the legality of its new tariffs. But the company argued that an injunction would not apply in respect of a completed act.  It pointed out that the order stated that “status quo” should be maintained, and argued that status quo as at the time the order was made meant the new subscription rates, not the old.
But the plaintiffs insisted that Multichoice ought to have obeyed the order because the suit was filed before April 1. “The order was made for a continuing action,” they said. The plaintiffs have gone ahead to file notice of consequences of disobedience to order of court, praying the court to charge MultiChoice directors for contempt.
However, the company said the notice of preliminary objection superseded all other pending applications, arguing that the court was obliged to determine the issue of jurisdiction because anything done without it being resolved first would be exercise in futility.  
While the parties argue their positions in court, there is no relief for consumers, who have started bearing the burden of new tariffs since April 1.
There are challenges for a case of this nature, one of which is the question whether the courts have powers to fix prices for private concerns such as MultiChoice in a free-market economy. Prices are determined by the market situation.  Another issue is what role the regulatory authorities play in the pricing of such services in the country. There appears to be none right now. Despite consumer complaints, the NBC pleaded helplessness, but acknowledged that part of its mandate was to ensure that the public on whose behalf it is managing the broadband spectrum gets served well.
 It is not clear what constraints the commission and the NCC have that they cannot invoke relevant provisions of their mandates to ensure that the consumer is not exploited by the service providers.  Both organisations should also break the near-monopoly that the service providers enjoy, and encourage more competitors to enter the market. Nigeria operates an already deregulated economy, it should worry the regulators, why other competitors are reluctant to come in.
The NBC in particular should remove all impediments that have hitherto encouraged the monopoly of MultiChoice to thrive, severely constraining the choices that subscribers should be able to make in a more competitive environment.