Independent Competition Authority: An Antidote to DSTV Pricing Saga – Economist Explains Why

As calls for stronger consumer protection in Ghana’s pay-TV market gain momentum, economist Dr. Theo Acheampong is demanding the establishment of an Independent Competition Authority to regulate businesses and protect consumers from exploitation.

This proposal is coming following what can be termed as a standoff between Ghana’s Communications Minister and satellite pay-TV giant DStv for price reduction.

Dr. Acheampong believes the matter raises deeper questions about consumer rights, monopoly power, and the urgent need for regulatory reform. For him, the development makes it imperative for the establishment of an Independent Competition Authority to properly scrutinize market concentration and protect consumers from potential exploitation.

His argument is that DStv’s pricing behaviour may not only be the result of external factors like exchange rate volatility or Ghana’s relatively small market size, but could also reflect monopoly rent extraction.

Monopoly rent extraction is a technical term used to describe how dominant firms exploit their market power to charge higher-than-competitive prices.

“The DSTV pricing saga once again strongly reminds me of the need for Ghana to have an 𝗜𝗡𝗗𝗘𝗣𝗘𝗡𝗗𝗘𝗡𝗧 𝗖𝗢𝗠𝗣𝗘𝗧𝗜𝗧𝗜𝗢𝗡 𝗔𝗨𝗧𝗛𝗢𝗥𝗜𝗧𝗬. Such a body would have served a great purpose in unpacking the dynamics and checking DSTV’s price behaviour. I am inclined to believe it is not just a question of small market size in Ghana, FX or regulatory dynamics at play, but 𝘀𝗼𝗺𝗲 𝗺𝗼𝗻𝗼𝗽𝗼𝗹𝘆 𝗿𝗲𝗻𝘁 𝗲𝘅𝘁𝗿𝗮𝗰𝘁𝗶𝗼𝗻,” Dr. Acheampong argued.

Such an authority will be able to properly analyse the pricing mechanisms of DSTV and establish whether indeed the pay-TV company is exploiting the market.

His comments follow a public directive from the Minister for Communications, Ursula Owusu-Ekuful, urging DStv to reduce its subscription prices by 30% in response to the recent strengthening of the Ghana cedi.

The directive sparked mixed reactions, with some supporting government intervention and others questioning its legal basis and long-term effectiveness.

But for Dr. Acheampong, the root of the problem lies in market structure, not just policy announcements.

He pointed to regulatory economics tools like the Herfindahl-Hirschman Index (HHI) which is a widely accepted measure of market concentration, to argue that Ghana’s pay-TV industry, dominated by DStv, likely scores above 0.70 on the index.

This would indicate a highly concentrated or near-monopoly market, where consumer choice is limited and price hikes go largely unchecked.

“Without working out the deep math, I would suspect DStv’s HHI to probably be more than 0.70, indicating high market concentration and an almost near-monopoly structure. This would indicate 𝗹𝗶𝗺𝗶𝘁𝗲𝗱 𝗰𝗼𝗻𝘀𝘂𝗺𝗲𝗿 𝗰𝗵𝗼𝗶𝗰𝗲 in that segment of the market, potentially justifying regulatory scrutiny or consumer protection interventions,” he further noted.

His remarks are particularly timely, coming just months after Nigeria’s Federal Competition and Consumer Protection Commission (FCCPC) sued DStv’s parent company, MultiChoice, for unilateral price increases. Ghana, however, lacks a similarly empowered competition body to lead such efforts.

Dr. Theo Acheampong’s call reinforces the advocacy of CUTS International, which has been demanding that the Parliament of Ghana pass the competition bill. However, the efforts have yielded few results.

The DSTV saga has reignited the call for a competition law that will protect consumers and businesses. For now, the pressure is on the government to act right, as many CSOs and analysts join the advocacy for consumer protection.

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