[kictanet] [ke-internetusers] Zain Kenya makes another move

Mon Aug 30 14:20:47 EAT 2010

I like the comparisons here. Safaricom's success lies in the sustainable BoP
focused strategy they rolled-out awhile back; so does Equity's success.
 Zain's strategy should therefore be a calculated shift from elitist to a
BoP focus...not a simple anti-Safaricom or "Vuka" campaign.

Wainaina

On Mon, Aug 30, 2010 at 2:11 PM, Johnstone Ole Turana <
jturana at ke.nationmedia.com> wrote:

>  Economics aside, the ongoing price wars mirrors the yesteryears customer
> battle between Equity Bank and the other banks. When Equity entered into
> conventional banking, it broke down all the entry barriers- ‘free account’,
> no charges for account maintenance (we all can recall the punitive minimum
> balance extortion), and banking the mwananchi.  Big banks fought this and
> gave Equity one year or so-after all banking was high cost, high end game
> not for the villages with erratic income.  Few years down the road the
> others have abandoned the exclusivity banking and embraced the Bottom of the
> Pyramid (BoP) customer.
>
> At least now I know for sure I can call and have a decent chat, cross the
> t’s and dot the i’s which is good for my provider.
>
>
>
> Cheers
>
> Ole Turana
>
>
>
> *From:* ke-internetusers-bounces at bdix.net [mailto:
> ke-internetusers-bounces at bdix.net] *On Behalf Of *Solomon Mburu Kamau
> *Sent:* Monday, August 30, 2010 1:58 PM
> *To:* Sam Gatere
> *Cc:* ke-users; KICTAnet ICT Policy Discussions
> *Subject:* Re: [kictanet] [ke-internetusers] Zain Kenya makes another move
>
>
>
> I always find ot interesting to see people always giving pessimistic views
> on an investment. I'm not a shareholder of either Safaricom or Zain, but
> find this trend welcome. Zain(Airtel) will make losses in the first round,
> but then, let's wait and see what they want to offer to the Kenyan market,
> as long as the consumer is the winner.
> I don't think the consumer is worried about the losses Zain made, but
> he/she wants to communicate using the most affordable pricing in the market.
> The rest, to him, are just politics of the corporate world.
>
> Me thinks
>
> On 30 August 2010 13:37, Sam Gatere <sam.gatere at gmail.com> wrote:
>
> Moaning about safaricom could be one of the strategies employed here... but
> we have to give a little grace to the dominant player where dealing with 15
> million plus clients is no easy task! However it would also be important to
> look at the difference in mind set between Western Investors and those from
> the East. The former (West) have no problems making 10 bob profit per call
> while their counterparts seem not to mind making 50 cents! We also need to
> look at this whole price war from a birds eye view before narrowing down to
> Kenya. Airtel has 15 networks across the continent while Safaricom is only
> in Kenya. Should Airtel make Nairobi their Africa hub (of which I think it
> is) they will definitely up their game in by investing more to make their HQ
> a profitable one. Possibly We will see this war move on to the Data arena in
> not to long.
>
>
>
> Sammy.
>
>
>
>
>
>
>
> On Mon, Aug 30, 2010 at 12:50 PM, Andrea Bohnstedt <
> andrea.bohnstedt at ratio-magazine.com> wrote:
>
>  That's really the key issue, isn't it? They won't make money anytime soon
> - there's the low rates, but also the fact that they'll have to invest
> heavily in network and systems. Easy to moan about Safcom's customers
> service - but they manage 16m clients. I'm curious to see if Zain will grow
> their customer service at the same speed to accommodate all those new
> subscribers.
>
> I also suspect that it'll be mostly very very price sensitive people who
> will change - again not the clientele that will earn the company much money.
>
>
> In 2008, when Zain had the Vuka tariff (KES8 on and off net, if I remember
> correctly), the company made nearly USD90m losses. Last year, USD46m losses.
>
>
> I found Mickael Ghossein's statement that 'the market is in a mess' quite
> telling. I suspect in this battle of the elephants, Orange and Yu are in
> most peril - which could easily contract the market again where subscribers
> have less choice.
>
> Full disclosure: I'm a client with both big companies. There's only so much
> a girl can put into her handbag.
>
> On 30 August 2010 12:31, Wainaina Mungai <wainaina at madeinkenya.org> wrote:
>
>  This is a very aggressive and most likely, a huge loss-making move in the
> short-run. I hope Zain has a well crafted (*sustainable*) longterm
> strategy.
>
>
>
> If they are simply 'playing politics' against a 78% market leader
> (Safaricom), then they will eventually price their way out of the Kenyan
> market.
>
>
>
>  Kencell losses *>>>* Celtel losses *>>> *Zain losses *>>> *AirTel losses
> *>>>      oblivion (or market leadership)*
>
>
>
> My opinion is not influenced by my 'Safaricom shareholder/MPESA user'
> status ;-)
>
>
>
> Wainaina
>
> On Mon, Aug 30, 2010 at 11:43 AM, Alex Gakuru <gakuru at gmail.com> wrote:
>
> BY MICHAEL KARANJA
> Updated 13 minutes ago
>
> NAIROBI, Kenya, Aug 30 - Mobile telephony operator Zain Kenya has
> introduced Sh5 and Sh10 denomination airtime vouchers as it steps up
> its efforts to capture the mass market.
>
> The introduction of the new vouchers is seen as a move to make the
> operator more accessible to the low-end market after a change in
> strategy following the entry of its new shareholders, Bharti Airtel.
>
> Zain Kenya Managing Director Rene Meza said the move is aimed at
> complementing its recent 50 percent reduction of call charges.
>
> “We are offering a wide range of scratch card denominations to suit
> the needs of all individuals. Access to telecommunication services is
> no longer a luxury but an integral part of each Kenyan’s
> socio-economic needs,” Mr Meza said.
>
> ....
>
> Read more:
> http://www.capitalfm.co.ke/business/Kenyabusiness/Zain-Kenya-makes-another-move-4606.html#ixzz0y4pjzlUG
> Under Creative Commons License: Attribution Non-Commercial No Derivatives
>
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> *Solomon Mbũrũ Kamau*
>
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