THE cash-strapped SABC stands to lose R250m-R400m if a total ban on alcohol advertising is imposed by the government, the broadcaster’s acting CEO Robin Nicholson said yesterday.
"An outright ban on alcohol advertising on television and radio is one of the biggest risks to SABC’s revenue," said Mr Nicholson. "It’s a significant part of our advertising revenue."
The SABC has warned the parliamentary portfolio committee on communications that such a ban would see the SABC lose about 8,5% of its advertising income. The SABC is the only public broadcaster in the world that has to rely almost exclusively on commercial revenue to fund its operations, with 80% of its revenue derived from advertising and 17% from licence fees.
A discussion document being circulated among the departments of health, social development and trade and industry, contains various proposals aimed at reducing alcohol consumption. These include limiting trading, a ban on sponsorships, higher taxes and a ban on advertising.
The SABC’s financial problems have occupied headlines , with the broadcaster indicating recently it did not intend to borrow more than the R1bn it received through a government guarantee, after a R1bn loss in the 2008-09 financial year. The broadcaster will still have to shed 699 out of 3699 jobs in order to streamline the organisation and cut costs, according to reports.
Mr Nicholson was recently asked by Parliament to name the top 20 risks to SABC revenue. "Obviously there were the normal ones like risk to market share, the decline of advertising and threats like mobile advertising, but loss of alcohol advertising revenue was at the top of the list," he said.
Marketing analyst Chris Moerdyk has warned that a ban would have implications for all media.
He said of the R17bn spent on advertising last year, about 10% could probably be directly attributed to alcohol advertising in the mass media.
"Removing that from the advertising and media industries would achieve nothing but considerable job losses.
"So much so that one could easily argue that an increase in alcohol abuse created by unemployment as a result of an advertising ban would exceed any benefits resulting from the ban," he said.
Mr Moerdyk said legislation banning smoking in public, and changes in the acceptability of smoking, helped to reduce smoking — not a ban on advertising. US research indicated that advertising bans led to a 5%-8% drop.
Some have argued that the ban would have more effect on marketing and advertising companies than on alcohol producers, as ads are aimed more at switching brands than encouraging drinking. It is also not clear how much money would be lost to soccer, cricket and rugby, which receive millions in sponsorship deals.
Health ministry spokesman Fidel Hadebe said yesterday the debate was at an early stage. "The ministerial committee , chaired by Social Development Minister Bathabile Dlamini, drew up the initial documents. Everyone will be consulted, including the alcohol industry before it is submitted to Cabinet. Look, alcohol abuse is a serious problem," he said.
Last month Ms Dlamini said a survey had shown that alcohol and substance abuse was destroying families.
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