Safaricom is spoiling for a fight and the gloves are off. The reason is “unfair regulations” and the stage is the telecoms market. We might just love the fight if it will bring down the exploitative rates we are currently seeing.
The bone of contention are the following;
- Kenya Information and Communication (Dispute Regulations) 2010
- Kenya Information and Communication (Tariff Regulations) 2010
- Kenya Information and Communication (Compliance Monitoring, Inspections and Enforcement Regulations) 2010
- Kenya Information and Communication (Fair Competition & Equality of Treat) Regulations 2010
- Kenya Information and Communication (Interconnection & Provision of Fixed Links Access & Facilities) Regulations 2010.
All these regulations have brought in a good fight which might just change the industry. Safaricom is protecting its turf but the truth is that there is just no reason why an operator should have a market share of more than 30% and still not declare it a monopoly. Where is the commisioner of monopolies? Why is the market so unfair. And Safaricom is in bed with the government and so it is taking alot of prodding to have the ministry and the regulator to step in and even out the market.
The Statement from Safaricom CEO is talking for them being punished for being successful but the truth is that nobody is punishing Safaricom. CCK is just implementing regulations which should have been in place 10 years ago.
The statement by Yu, Orange and Zain talks of real competition as there had never been any real competition. “As industry players we believe that the real winners in the implementation of these regulations will be the consumers of telecommunication services. The regulations will ensure that there is real competition, and consumers will benefit greatly from improved services from all operators as well as lower costs and the freedom to move from one operator to another.” read the statement.
What this will bring into the market is yet to be seen but truth be told. Safaricom rode onto the Telkom (government) network for free for 5 years. Safaricom has got it really easy and if let unchecked, Safaricom is becoming a monopoly which must be stopped.
We have asked for the intervention since 2007 but no one has cared to listen. Before this, all the other operators have thought that the regulation was going to affect them, but the truth is that the regulations will benefit small players and level the playing field.
The argument by Safaricom that CCK is becoming a player is not true. CCK is waking from the slumber and accusation of favouritism and stamping its authority in the market. Without the regulator doing that, it is going and has been very unfair to the consumer since the dominant player, not only in voice but also data, have become too arrogant and lost touch with the consumer. Also the on-net calls have become 11% cheaper but that is not the problem. The problem is the off-net and regional calls.
This is not price controls, this is simply CCK waking up and giving the consumer haki yake (his / her rights).
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First you have to know that in the fair competition policy published, dominant doesnt equal to Safaricom. Safaricom dominates in many but not all and so let us drop that equation of “dominant” to “Safaricom”. Telkom Kenya dominates in selling data to the operators as it is the one authorised to sell the cable data to theplayers on behalf of the government.
Secondly, Orange has issues we know and they range from problems with the personnel to poor management on many fronts but that is not the manin reason why they made the loss. Safaricom is holding the highest spenders in the mobile telephony market. And this you can see why Safaricom pays termination charges of just over Ksh 4 but goes as far as charging more than 10 shillings on calls. This is not fair and amounts to a rip-off by Safaricom. It is ripping off Kenyans and also exaggerating its charges to make crazy profits and in many countries, Safaricom CEO would have been in court. Yes you can charge but you cant charge three times or four times what you spend to get the service.
It is true that Dr Bitange talks sweetly and makes you think that he is an angel which he is not. He has allowed Safaricom to run roughshod and nowadays you cant do anythign about the CEO even when he is utterly out of line. Data market needs infrastracture and very expensive investment. You dont compete in a race by telling your competitors or the competitors in the case of Ndemo that if you feel going round the field is hard then why not cross right in the middle or better still go in the opposite direction.
The regulations were never advocated for much by the players. It is us the consumers through many forums who did demand that Safaricom dominance is acted upon. Safaricom should have been declared a monopoly long time ago. Safaricom has succeeded in silencing the media through bribery and those journalists who have dared be open to Safaricom acts have lived to regret it through sackings and warnings. Safaricom is the EABL of the data and voice market.
No operator must be allowed to own more than 25% of the market. Imagine Safaricom owns and dominates 80% of the market. Safaricom is very expensive to use, but they hold you with very uncompetetive methods. Safaricom didnt be where they are because of hard work. Safaricom borrowed alot from the local market and Safaricom got free Telkom Kenya infrastracture usage for more than 5 years. I tell you that with those even if you were a fool, you will make billions.
Do you remember CEO Michael Joseph saying that to come to invest in Kenya you need first a generator, a 4×4 and then good security. What I want to ask and look for the opportunity to ask him is why Kenya must have poor investors who cant even afford those? Most successful investment stories here including NMG, Safaricom, Kengen, Access Kenya and the like have not had investors bring their money. They have borrowed heavily from the local market. Orange Kenya has literally survived on Government loan. Kengen borrowed heavily in NSE and that is me and you funding them.
Safaricom ran for free and has abused the goodwill of Kenyans. It must be ready to compete in a market which is level
But there was a problem with the government allowing Safaricom to control 80% of the market. That alone is just wrong. That is monopoly
First you have to know that in the fair competition policy published, dominant doesnt equal to Safaricom. Safaricom dominates in many but not all and so let us drop that equation of “dominant” to “Safaricom”. Telkom Kenya dominates in selling data to the operators as it is the one authorised to sell the cable data to theplayers on behalf of the government.
Secondly, Orange has issues we know and they range from problems with the personnel to poor management on many fronts but that is not the manin reason why they made the loss. Safaricom is holding the highest spenders in the mobile telephony market. And this you can see why Safaricom pays termination charges of just over Ksh 4 but goes as far as charging more than 10 shillings on calls. This is not fair and amounts to a rip-off by Safaricom. It is ripping off Kenyans and also exaggerating its charges to make crazy profits and in many countries, Safaricom CEO would have been in court. Yes you can charge but you cant charge three times or four times what you spend to get the service.
It is true that Dr Bitange talks sweetly and makes you think that he is an angel which he is not. He has allowed Safaricom to run roughshod and nowadays you cant do anythign about the CEO even when he is utterly out of line. Data market needs infrastracture and very expensive investment. You dont compete in a race by telling your competitors or the competitors in the case of Ndemo that if you feel going round the field is hard then why not cross right in the middle or better still go in the opposite direction.
The regulations were never advocated for much by the players. It is us the consumers through many forums who did demand that Safaricom dominance is acted upon. Safaricom should have been declared a monopoly long time ago. Safaricom has succeeded in silencing the media through bribery and those journalists who have dared be open to Safaricom acts have lived to regret it through sackings and warnings. Safaricom is the EABL of the data and voice market.
No operator must be allowed to own more than 25% of the market. Imagine Safaricom owns and dominates 80% of the market. Safaricom is very expensive to use, but they hold you with very uncompetetive methods. Safaricom didnt be where they are because of hard work. Safaricom borrowed alot from the local market and Safaricom got free Telkom Kenya infrastracture usage for more than 5 years. I tell you that with those even if you were a fool, you will make billions.
Do you remember CEO Michael Joseph saying that to come to invest in Kenya you need first a generator, a 4×4 and then good security. What I want to ask and look for the opportunity to ask him is why Kenya must have poor investors who cant even afford those? Most successful investment stories here including NMG, Safaricom, Kengen, Access Kenya and the like have not had investors bring their money. They have borrowed heavily from the local market. Orange Kenya has literally survived on Government loan. Kengen borrowed heavily in NSE and that is me and you funding them.
Safaricom ran for free and has abused the goodwill of Kenyans. It must be ready to compete in a market which is level
But there was a problem with the government allowing Safaricom to control 80% of the market. That alone is just wrong. That is monopoly
Thank you very much for highlighting this issue as we have been watching it unfold in the media.
However, what Kenyans need to understand is that these are rules that will govern and standardise the communications sector as a whole and not only the telecommunications sub sector. This regulations apply to content service providers, internet service providers, postal and courier operators and many other subsectors within the Communications sector.
So really, for Safaricom to come out guns blazing and claiming that they are being attacked is rather premature.
What these regulations focus on is the market and the variables that have come into play since the first regulations were developed earlier in this decade. The ICT sector has experiecned tremendous growth, there is stiff competition for customers and there is development in terms of technology. Therefore retention of the old regulations would be seen as retrogressive, we need to move with the times if we are to keep up and this includes regulations.
As for Safaricom being dominant, it is not something that the regulator or the government for that matter can wake up and claim, there are procedures and preocess to declaring one player and this will probably happen if that palyer has started abusing the large market share that they control thereby locking competition out.
This is business and Safricom was the first company that came into the country to invest, first off, this is a great risk they took, investing in a third wolrd country that is rife with corruption is no mean task, and their risk paid off greatly. This can only be said to be good business acumen and good marketing strategies.
The regulations will not penalise anyone, but the consumer is the main beneficicary of this!!
And for your information, the Ministry also gazetted regulations on consumer protection.
Thank you very much for highlighting this issue as we have been watching it unfold in the media.
However, what Kenyans need to understand is that these are rules that will govern and standardise the communications sector as a whole and not only the telecommunications sub sector. This regulations apply to content service providers, internet service providers, postal and courier operators and many other subsectors within the Communications sector.
So really, for Safaricom to come out guns blazing and claiming that they are being attacked is rather premature.
What these regulations focus on is the market and the variables that have come into play since the first regulations were developed earlier in this decade. The ICT sector has experiecned tremendous growth, there is stiff competition for customers and there is development in terms of technology. Therefore retention of the old regulations would be seen as retrogressive, we need to move with the times if we are to keep up and this includes regulations.
As for Safaricom being dominant, it is not something that the regulator or the government for that matter can wake up and claim, there are procedures and preocess to declaring one player and this will probably happen if that palyer has started abusing the large market share that they control thereby locking competition out.
This is business and Safricom was the first company that came into the country to invest, first off, this is a great risk they took, investing in a third wolrd country that is rife with corruption is no mean task, and their risk paid off greatly. This can only be said to be good business acumen and good marketing strategies.
The regulations will not penalise anyone, but the consumer is the main beneficicary of this!!
And for your information, the Ministry also gazetted regulations on consumer protection.