The TV licence is dead! Long live the streaming levy - or not?

Source: © 123rf 123rf Leslie Adams, sales director at Reach Africa, asks, while TV licences are outdated, is a streaming levy the right fix?

Less than 20% of South Africans with a licence pay, and the costs of chasing payments often outweigh the revenue collected.

People simply don’t see the value in funding a public broadcaster when they have an endless stream of content available elsewhere.

That said, the SABC still matters. It provides news, educational programming and entertainment for millions who can’t afford premium services.

But its role goes beyond content—it ensures that vital information reaches all South Africans, promotes local storytelling, and supports cultural preservation.

Solly Malatsi, South Africa’s Minister of Communications and Digital Technologies, recently announced that he was considering introducing a levy on streaming services as a funding option for the SABC.

He stated that the current TV licence model was inadequate due to "low compliance, high collection costs and the eroding effects of inflation".

Yet forcing streaming platforms to foot the bill isn’t as simple as it sounds.

Who will pay?

Should the levy be implemented, the biggest concern is who’s really going to pay. Will streaming services absorb the levy or pass it to us?

In some countries, streaming services absorb levies as part of their operating costs – but that’s unlikely here.

We’ve already seen Netflix, Amazon and Disney+ increase their prices multiple times in the past few years.

If this levy goes ahead, chances are high that South Africans will be the ones covering the cost through higher subscription fees.

And with the economy under pressure, that’s not great news.

Many South Africans are already cutting back on entertainment spending. If prices rise again, more people might turn to illegal streaming, free ad-supported content or even ditching paid services altogether.

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Supporting local content

Beyond funding the SABC, there’s a bigger conversation to be had about how global platforms support local content.

Over the years, Netflix, Amazon and Showmax have invested heavily in local productions, giving our stories a global audience.

But that investment is starting to slow down.

Some platforms are becoming more selective with local content, and Amazon has already reduced its spend in Africa.

Moreover, as streamers shift focus from subscriber growth to profitability, content churn is set to accelerate.

Viewers, constantly switching platforms for fresh entertainment, are pushing streaming providers to deliver more at a faster pace.

This leads to reduced budgets and a drop in content quality.

If the government forces streaming platforms to pay a levy, it’s a real possibility that streamers will cut back on local investments even further.

On the other hand, if the levy is structured properly, it could be channelled back into funding local productions, creating jobs and supporting the industry.

But that’s the key – it needs to be done right.

If there’s no transparency in how these funds are used, we could end up with another tax that disappears into the system without benefiting South African creatives and content producers.

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Could streaming platforms exit South Africa?

Would Netflix, Amazon or Disney+ leave the country because of this levy?

Probably not. South Africa is still a valuable market for streaming services, and global platforms have dealt with tougher regulations elsewhere.

But they could scale back their operations, reduce local content investments or bundle the costs in a way that makes streaming less affordable for South Africans.

It’s also worth noting that streaming services already face high costs here.

Bandwidth isn’t cheap, and many platforms partner with telecom providers to keep data costs manageable.

Adding another tax into the mix could make things even more complicated.

What would a fair and sustainable levy look like?

For this levy to work, it must support the public broadcaster and the local content industry – without making streaming unaffordable.

Funds should be reinvested in local films and TV shows, not absorbed into government budgets. The levy must also be reasonable.

If it’s too high, streaming platforms will pass the cost onto consumers or cut local investments, hurting viewers and the industry.

Different streaming models must also be considered – a flat tax won’t work for platforms that operate differently.

Additionally, private broadcasters like MultiChoice and eMedia could also contribute: a local content levy for these broadcasters would ensure that funding responsibility is shared more equitably, rather than placing the entire burden on global streaming platforms.

Finally, the SABC must prove it can manage funds responsibly.

Before imposing a new tax, the government needs to fix inefficiencies and ensure transparency, so this revenue benefits South African content producers.

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A levy could work – but only if handled carefully

South Africa isn’t the first country to try taxing global streaming services.

Some places have made it work, while others have seen unintended consequences – higher prices, less local investment and frustrated consumers.

If done right, a streaming levy could strengthen South African content creation and help sustain the SABC.

But if it’s rushed or mismanaged, it could drive up prices, push people toward piracy and hurt local content investment.

The government needs to engage with all stakeholders – streaming services, content creators and consumers – to find a fair, effective solution that benefits the entire entertainment ecosystem.