Digital Migration Survey Report forConsumers Federation of

Kenya(COFEK)December 2013

Prepared ByInfotrak Research & Consulting

103 Manyani East Road, LavingtonP.O Box 23081,00100 GPO

Tel: 020 4443450/1/2www.infotrakresearch.com

Background of the Survey

The International Telecommunication Union (ITU) during a Regional RadioConference held in 2006 in Geneva set July 2015 as the deadline for itsmembers to migrate from analogue TV broadcasting to digital TVbroadcasting.

Digital broadcasting is transmitted on radio frequencies through use ofmultiplex transmitters to allow reception of multiple channels on a singlefrequency range. The digital signals can either be accessed through integratedTelevision Sets with in build DVB-T2 tuners, Pay TV Set Top Boxes, orordinary TV sets with external Set Top Boxes (STBs)

Those who own ordinary TVs should thus acquire Set Top Boxes (STBs) toaccess the digital signals. The cost of a STB range from Ksh 4000 to 16000.On the other hand, Integrated Television Sets with in build DVB-T2 tunerscost Ksh 35,000 and above.

Background of the Survey

Being a member of the ITU, Kenya is in the process ofimplementing migration from analogue to digital TV broadcastingto meet the July 2015 deadline

As part of the digital TV migration process, the Ministry ofInformation, Communications and Technology through theCommunications Commission of Kenya intends to switch offanalogue TV broadcasting in Nairobi and its environs on 13th

December 2013

Analogue TV signals in other parts of the country (Mombasa,Malindi, Nyeri, Meru, Kisumu, Webuye, Kisii, Nakuru andEldoret) will be switched off on March 30th 2014

Rationale of the Survey

Close to half of Nairobi’s 2 million households which owntelevision sets are yet to acquire Set To Boxes to access digital TVsignals come 13/12/2013

This means millions of Kenyan’s will not watch their TVs if CCKgoes ahead and switches off analogue TV signals on 13/12/2013

Following the pending switch off, COFEK commissionedInfotrak to conduct a poll on Kenyans’ views and preparednesson the digital TV migration in Nairobi

Research Methodology

Quantitative Approach employedFace to Face (F2F) interviewsusing Computer Aided PersonalInterviews (CAPI).

A sample of 1000 interviews wereconducted translating intomargin of error of +/-3 at 95%confidence level.

Fieldwork was conductedbetween 27th - 30th November2013

• The Quantitative approach targeted Kenyans who own TVs spread across the following Socio-Economic Classes: AB, C1,C2, D

A Quantitative Approach

• The wealthyClass AB

• The middle classClass C1

• The lower middle classClass C2

Class D The poor and low income group

SAMPLE DISTRIBUTION

Constituency Sample RatioWestlands 60 7%Dagoretti North 60 5%Dagoretti South 60 6%Langata 60 6%Kibra 60 5%Roysambu 60 8%Kasarani 60 5%Ruaraka 60 7%Embakasi South 60 3%Embakasi North 60 6%Embakasi Central 60 3%Embakasi East 50 7%Embakasi West 60 7%Makadara 50 5%Kamukunji 70 7%Starehe 50 5%Mathare 60 8%

Method Scope Sample

QuantitativeFace To Face Interviews

Face to face interviews• Age: 18+ (SEC: AB, C1, C2, D) • Gender: Male/Female

1000 Interviews

DEMOGRAPHICS

55%45%

0%

20%

40%

60%

80%

100%

Male Female

6%

24% 28%18%

9% 6% 4% 4%0%

20%

40%

60%

80%

100%

18-20 21-25 26-30 31-35 36-40 41-45 46-50 51+

35%

61%

3%0%

20%

40%

60%

80%

100%

Single Married Widowed

2%

11%

51%

36%

0%

20%

40%

60%

80%

100%

AB C1 C2 D

10%

33%39%

16%

2% 0%0%

20%

40%

60%

80%

100%

Primary Secondary College University Post graduate

NoneLEVEL OF EDUCATION

GENDER AGE MARITAL STATUS

SOCIO-ECONOMIC CLASS

KEY FINDINGS

Whereas Nairobians are willing to embrace digital TVmigration, a majority (64%) of the survey respondents wouldprefer CCK to effect switch-off of analogue TV signals in June2014

The current price of Set Top Boxes is unaffordable to many. Amajority (53%) of the survey respondents (especially the poor)would prefer the Set Top Boxes to be priced at Ksh 1000 0rbelow.

Digital TV migration is not a priority to majority of Nairobiresidents. In terms of household budgetary priorities, amajority (58%) of the survey respondents would place digitalTV migration as low when compared to other needs like food,rent and transport.

Readiness for Digital Migration

64%

100%90%

67%48%

39%57%

66%85% 83%

0%

33%

7%

29%48%

56%37%

31%

14% 17%

100%

4%3%

4% 4% 6% 6% 3% 1% 0%

0%

20%

40%

60%

80%

100%

Aggregate (n=1000)

AB (n=20) C1 (n=108) C2 (n=512) D (n=361) Primary (n=99)

Secondary (n=331)

College (n=389)

University (n=163)

Post graduate

(n=15)

None (n=4)

Yes No Not sure/Don’t Know

Asked whether they were ready for digital TV migration, a majority (64%) of thesurveyed respondents answered in the affirmative. It’s noteworthy that readinessfor digital TV migration was highest among the wealthy and highly educated(social economic classes AB, C1).

On the other hand, nearly half (48%) of the low income group (social economic class D) are not ready for digital TV migration.

Are you ready for digital TV migration?

Preferred timing for digital TV migration

27%

94%

51%

28%15%

7%20%

29%43%

77%

0%

64%

41%

66%

73%73%

69%64%

56%

18%

30%

9% 8% 7% 12% 20% 11% 7% 1%

5%

0%

20%

40%

60%

80%

100%

Aggregate (n=1000)

AB (n=20) C1 (n=108) C2 (n=512) D (n=361) Primary (n=99)

Secondary (n=331)

College (n=389)

University (n=163)

Post graduate

(n=15)

None (n=4)

Dec-13 Jun-14 Not sure/Don't Know

A majority (64% )of the survey respondents would prefer the digital TV migrationin Nairobi to be effected on June 2014. On 27% of respondents indicatedpreference for the December 2013 digital TV migration deadline. It is mainly thelow income groups (social economic classes C2, D) who would prefer the switchoff to be effected in June 2014 .

Would you prefer digital TV migration taking place in December 2013 or June 2014?

A majority (53%) of the survey respondents would prefer the Set Top Boxes to be priced at Ksh 1000 0r below. A majority of those preferring the STBs to be priced at Ksh 1000 or below are the poor. As such, the current pricing of STBs may be unaffordable to many.

What would be your most preferred pricing range for Set Top Boxes (STBs)?

Preferred pricing for Set Top Boxes (STBs)

53%

21%

33%

53%62%

73%

61%

48%39% 38%

100%

31%

28%

36%

35%23%

19%

24%

36%

39%32%

0%

12%

51%

25% 9% 11% 11% 12% 20%24%

2% 3% 2% 2% 1% 4% 2%0%

2% 2% 2% 2% 1% 4% 1% 1% 5%0%

0%

20%

40%

60%

80%

100%

Aggregate (n=1000)

AB (n=20) C1 (n=108) C2 (n=512) D (n=361) Primary (n=99)

Secondary (n=331)

College (n=389)

University (n=163)

Post graduate

(n=15)

None (n=4)

Ksh 1000 Ksh 2000 Ksh 3000 Ksh 4000 and above Not sure/Don’t know

In terms of household budgetary priorities, a majority (58%) of the survey respondents (across all social economic groups) would place digital TV migration as low when compared to other needs like food, rent and transport .

In terms of other budgetary priorities like food, rent and transport, where would you place the importance of digital TV migration to your household?

Household Budgetary Priorities

High, 6%

Mid, 36%

Low, 58%

Not sure/Don’t know, 1%

10%3% 8% 4%

61%69%

38%

21%

29% 27%

53%

75%

0%

20%

40%

60%

80%

100%

AB (n=20) C1 (n=108) C2 (n=512) D (n=361)

High Mid Low Not sure/Don’t know

TV (at 46%) is the most preferred channel of communication for receiving consumer education on the digital TV migration process.

It is followed by Swahili radio stations (21%) and vernacular radio stations (11%) which are mainly preferred by those with low levels of education.

Through what medium would you prefer to receive consumer education on the digital TV migration process?

Preferred channels of communication

Aggregate(n=1000)

AB(n=20

)

C1(n=10

8)

C2(n=51

2)

D(n=36

1)

Primary

(n=99)

Secondary

(n=331)

College

(n=389)

University

(n=163)

Post-graduate

(n=15)None (n=4)

Television (TV) 46% 69% 65% 48% 36% 29% 35% 51% 60% 82% 70%

Swahili radio stations

21% 6% 16% 18% 28% 29% 35% 15% 5% 0% 0%

Vernacular radio stations

11% 0% 5% 10% 15% 24% 13% 8% 4% 0% 30%

English radio stations

10% 16% 6% 10% 10% 6% 7% 12% 12% 0% 0%

Newspapers 6% 9% 6% 6% 6% 5% 3% 7% 12% 12% 0%

Open on – site meetings

4% 0% 2% 4% 4% 2% 3% 5% 4% 6% 0%

Other 3% 0% 0% 4% 1% 5% 4% 1% 3% 0% 0%

A majority (63%) of the survey respondents rated the Ministry at below 50% with respect to its performance in handling the digital TV migration process.

How would you rate the performance of the Ministry of Information, Communications and Technology on digital TV migration?

Rating of the Ministry of Information, Communication and Technology

30%

33%

25%

7%5%

0%

10%

20%

30%

40%

0 – 25 % 26 – 50% 51 – 75% 76 – 100% Not sure/Don’t know

Similarly, a majority (65%) of the survey respondents rated the CCK at below 50% with respect to its performance in handling the digital TV migration process.

How would you rate the performance of the Communications Commission of Kenya (CCK) on digital TV migration?

Rating of the Communications Commission of Kenya (CCK)

30%

35%

23%

6% 6%

0%

10%

20%

30%

40%

0 – 25 % 26 – 50% 51 – 75% 76 – 100% Not sure/Don’t know

Rating of Digital TV Service Providers

DSTV is the most preferred service provider among the surveyed respondents, with preference score of 39%. GoTV is the second most preferred service provider at 25%. The latter is preferred mainly by those in socio-economic class D.

Which is or would be your preferred service provider for the digital TV migration?

4%

8%

11%

14%

25%

39%

Other

Signet

Zuku

Star Times

GoTV

DSTV

AB (n=20)C1

(n=108) C2 (n=512) D (n=361)

DSTV 69% 52% 41% 30%

GoTV 17% 23% 20% 33%

Star Times 0% 10% 13% 16%

Zuku 14% 13% 12% 8%

Signet 0% 3% 8% 11%

Other 0% 0% 6% 1%

Star Times was rated as the worst service provider at 19%. The ratings cut across all Socio-Economic classes. Following in sequence is Zuku 13%, GoTV at 10%, with Signet and DSTV both scoring 9%

Which of these companies has the worst service provision rating in your view?

AB (n=20)C1

(n=108) C2 (n=512) D (n=361)

Don’t know/ Notsure 42% 37% 44% 35%

Star Times 15% 29% 16% 21%

Zuku 10% 11% 13% 14%

GoTV 9% 7% 10% 9%

Signet 14% 8% 7% 13%

DSTV 9% 8% 9% 8%

Rating of Digital TV Service Providers

9%

9%

10%

13%

19%

40%

0% 20% 40% 60%

DSTV

Signet

GoTV

Zuku TV

Star Times

Don’t know/ Not sure

A majority (58%) of the survey respondents were of the view that the third digital TV signal distribution license should be awarded to Media Owners Association but through a competitive process. It’s mainly the wealthy who would prefer the 3rd license to be issued to media owners without competition.

Kindly express your support of or objection to the third digital distribution license being awarded to the Media Owners Association

Awarding of the Digital TV Signal Distribution License

58%

32%41%

60% 59%72%

51%61% 58%

77%

0%

27%

43%36%

29%23%

15%

33%26% 26%

12%

100%

10%25% 18%

7%13% 9%

11% 14% 6%4%

5%4% 4% 5%

7% 2% 1%5%

0%

20%

40%

60%

80%

100%

Aggregate (n=1000)

AB (n=20) C1 (n=108) C2 (n=512) D (n=314) Primary (n=99)

Secondary (n=331)

College (n=389)

University (n=163)

Post graduate

(n=15)

None (n=4)

Yes but it should be awarded competitively Yes and it should be awarded without competition No Other