Government must come to the party and offer financial support, says Mpofu

PRICEY VENTURE: SABC chief executive officer Dali Mpofu says profit was low because the broadcaster invested in new technology and upgrades. © Sowetan.
PRICEY VENTURE: SABC chief executive officer Dali Mpofu says profit was low because the broadcaster invested in new technology and upgrades. © Sowetan.

State broadcaster SABC's profits have dropped by R200million when comparing the past financial year with the previous one, the company said yesterday.

State broadcaster SABC's profits have dropped by R200million when comparing the past financial year with the previous one, the company said yesterday.

Profits dropped from R382million in the 2005/06 financial year to R182million in the 2006/07 financial year.

At the presentation of the financial results yesterday, SABC chief executive officer Dali Mpofu attributed the lower profit to the corporation's investment in and upgrade of infrastructure and new technology.

Mpofu said the SABC made significant sacrifices in revenue last year to support investments in the corporation, SABC News reported.

Mpofu said the returns on these investments would be tangible in the next two years. "In terms of revenue we had a modest growth in the region of about 8percent because of a massive increase in the cost structure.

"The first 70 years of broadcasting in South Africa is ancient history. We are entering into a completely new ball game. We needed to do massive investments in technology, in people and in various other aspects such as the acquisition of rights and so on, for us to be able to compete meaningfully in that space. We had to protect our jobs, or protect our people and make sure they had a role to play in a completely new environment," he said.

The results show that at present the funding mix is 77percent commercial funding, 18percent licence fees, only 2percent government support and 3percent funding from other sources.

He challenged the government to come to the party.

"It's a serious situation and I don't think that our government actually appreciates the seriousness of that situation, (that is) the risks that are involved in having a public broadcaster that is overly dependent on commercial advertising," Mpofu said. - I-Net Bridge

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