[kictanet] RELIANCE MISSES OUT ON SNO LICENCE IN KENYA

[John Walubengo]

MM & Eric,

You both raise good points and the way forward - but my
feel is that it matters NOT how perfect your Policy and/or
Regulation looks like on paper; as long as the Spirit of
implementation is lacking or distorted then you will always
ran into problems...

Someone claimed (was it here or offline?) that Somalia
(which lacks any Telecomms Policy and Regulatory framework)
enjoys cheaper and more liberal telecommunications
environment than Kenya. Though I don't have evidence for
this, if it turns out to be true, it would support my
thinking that the (Policy) Documents are not the problem
-the problem maybe in the implementation processes.

walu.
--- Eric Osiakwan <eric at afrispa.org> wrote:

> Muriuki,
> 
> Issues well raised and am sure the government would like
> to listen.
> 
> I would suggest that a KICTANET meeting at which the
> larger framework  
> of vertical as opposed to horizontal layering or unified
> licensing as  
> opposed to Open Access of the communication system is
> discussed in  
> detailed with the pros and cons. This meeting should end
> with some  
> majority consensus and should have all the stakeholders
> so that as  
> sector we are clear at least on the framework of our
> engagement going  
> forward.
> 
> I would also submit that a seperate meeting at which the
> local  
> ownership of foreign stake and the mechanism for SME
> uptake as well  
> as growth path is clearly outlined so that whiles you
> need some big  
> fishes now you can also create your own big fishes in the
> future and  
> more so as the sector progress with time.
> 
> Eric here
> 
> 
> 
> On 19 Mar 2007, at 11:58, Muriuki Mureithi wrote:
> 
> > It is time we reviewed the bidding system this country
> has  
> > adopted   to
> > remove conflict of policy interest and move this
> country forward.  
> > We must
> > address ourselves to the purpose of the licence - is it
> to  make  
> > money for
> > the government to fill treasury gaps or to expand the  
> > telecommunications
> > infrastructure. By demanding to have the cake and eat
> it, we are  
> > nowhere   5
> > years after starting the process of SNO and Third
> Cellular  
> > Operator. It is a
> > lesson well documented in countries that Kenya copied
> ref Senegal  
> > and Malawi
> > among others. At the heart of the conflict is a
> government stating  
> > that ICT
> > is the driver of growth   yet put barriers   which
> cripple the  
> > operators
> > even before they start.
> >
> > The requirements of local partnership while sweet for
> political  
> > reasons is
> > difficult to realise because the international partners
> have  
> > inadequate time
> > to assess the right partner and hence the problems for
> SNO and third
> > cellular
> >
> > We need immediate action
> > - first, scrap the requirement of 30% local owner by
> the time of  
> > application
> > of licence  but require that within 3 years the winner
> has brought  
> > on board
> > local shareholders through the stock exchange and raise
> ownership  
> > to at
> > least 49% by year 5 of operation . This has worked well
> for Tz
> > - Second, the licence is not a cash cow - we need
> infrastructure  
> > badly now
> > therefore that licence money should be invested to
> enable the  new  
> > entrant
> > to compete with the incumbents  and roll out rapidly . 
> Licence  
> > should not
> > cost more that USD1. What the entrants should compete
> with is the  
> > cash they
> > will invest in Kenya and the timeline.
> > -finally, CCK should address the anomaly of conflicting
> policies it  
> > issues.
> > In 2004, CCK issued a policy which translates to
> adoption of   
> > horizontal
> > licensing regime to move away from vertical licensing
> regime. The SNO
> > licence is in direct contradiction of the 2004 policy.
> Was the policy
> > rescinded? The danger of the unified licence is that it
> denies  
> > Kenyan ICT
> > entrepreneurs a natural growth path and condemns Kenya
> to  
> > permanently have
> > few mega operators and many small operators   without a
> path to  
> > migrate from
> > small to big. Should the envisaged fast growing economy
> to vision  
> > 2030 be
> > hinged on few mega operators whose power can sometimes
> rival the  
> > regulator?
> > We need a paradigm shift towards horizontal licensing
> >
> > Cheers
> > Muriuki Mureithi
> >
> > ---------------------------------------
> > Summit Strategies Ltd  -
> > ICT Consultancy  &  Research in  Eastern & Central
> African markets
> > Contacts : Tel  +254 (20) 3875824 , Cell + 254 (722)
> 520090,
> > email: mureithi at summitstrategies.co.ke
> >  alternate email : muriuki.mureithi at gmail.com
> >
> >
> >
> >
> > -----Original Message-----
> > From:
>
kictanet-bounces+mureithi=summitstrategies.co.ke at kictanet.or.ke
> > [mailto:kictanet-bounces 
> > +mureithi=summitstrategies.co.ke at kictanet.or.ke] On
> > Behalf Of alice
> > Sent: 19 March 2007 09:01
> > To: mureithi at summitstrategies.co.ke
> > Subject: [kictanet] RELIANCE MISSES OUT ON SNO LICENCE
> IN KENYA
> >
> >  From BALANCING ACT:
> >
> > RELIANCE MISSES OUT ON SNO LICENCE IN KENYA
> >
> > The Communications Commission of Kenya has cancelled a
> tender for  
> > the second
> > national operator (SNO) licence that it had awarded
> Reliance  
> > Communications,
> > after the consortium failed to pay for the fees.
> >
> > This is the second cancellation, after CCK annulled the
> licence it  
> > had given
> > a consortium led by Dubai-based Vtel Holdings in
> January, for  
> > failing to pay
> > the US$169 million (Sh12 billion) licence fee it had
> bid.
> >
> > Reliance, which was the second highest bidder at US$111
> million (Sh7.8
> > billion), was allowed to apply for the licence, but on
> condition  
> > that it pay
> > Sh12 billion to match Vtel's bid. Reliance confirmed
> that it would  
> > take up
> > the offer and requested for more time to prepare for
> the licence.
> >
> > CCK said last week Reliance had a deadline of March 15.
> "By the  
> > expiry of
> > the said deadline at 4.00 p.m. yesterday (Thursday)
> Reliance  
> > Communications
> > had not made a formal application for the licence as
> required," CCK  
> > said.
> > The Commission's director-general John Waweru said they
> had  
> > resolved to
> > immediately restart the tendering process for the
> licence.
> > (SOURCE: The Nation)
> >
> >
> > _______________________________________________
> 
=== message truncated ===>
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