[kictanet] Price Control in the Telecom Market in Kenya?

[Edith Adera]

Bwana Ndemo,

While I agree with most of your analysis (not all), could you please be SPECIFIC on what your "conservative stand" is?

That would allow appropriate response.

In the meantime, we need to keep in mind what drives innovation - the insatiable desire to survive (NOT TO DIE) rather than "protection"!!

Lets support innovation rather than protection!

Edith

PS: who should be the "objective" arbitatrator given Government's stake in Safaricom? or was it all sold?

_______________
Edith Ofwona Adera
Senior Program Specialist
ICT4D Program and Climate Change & Water Program
International Development Research Centre | Centre de recherches pour le développement international
Regional Office for Eastern and Southern Africa
Tel: +254202713160 | Fax/Téléc: +254202711063 | Skype: edithadera
eadera at idrc.or.ke | www.idrc.ca | www.crdi.ca
________________________________________
From: bitange at jambo.co.ke [bitange at jambo.co.ke]
Sent: 16 February 2011 11:58
To: Edith Adera
Cc: bitange at jambo.co.ke; KICTAnet ICT Policy Discussions
Subject: Re: [kictanet] Price Control in the Telecom Market in Kenya?

Edith,
Prices will eventually come down even below one shilling especially when
Subscriber base begins to exceed 100%.  It is selfish for us now to
celebrate lower tarrifs when coverage is at 40%.  We need to improve
coverage to at least 90%.  There are pockets even in Nairobi where none of
the operators has covered.  The quality of service is still wanting as new
technologies that put pressure on capex keep on emerging.  We are not
seeing aggresive rollout of 3G which all of you agree that it is critical
to our last mile broadband.

For many years, Kenya's development has largely been minimalist,
depressing and expensive.  In the past few years, we started moving from
such experiments and made serious interventions in the Telcoms and Road
sectors.  Serious investors are now considering Kenya as a good investment
destination.  Other consideration include return on investment not only
for foreign investors but local investors too.  Margins therefore become a
critical factor.

There is no where in the world where lower margins have kept pace with
technology.  Any analyst will tell you that at the pace which prices are
coming down in Kenya, one operator is bound to die.  Unfortunately, most
of the celebrating crowd will train their spears on government asking what
it was doing.  Whichever way the government gets the flak.  That is why I
make no apologies for taking a conservative stand.


Regards


Ndemo.





> Listers,
>
> The news I heard today made me wanna shadder!
>
> A player with market power asking for price controls in the telecom
> market? Are we progressing or retrogressing?
>
> Telecom Economics dictates otherwise and this must NOT happen in a free
> and competitive market! Our recent discussions on broadband access just
> goes to confirm that we are not there yet. We have not yet reached the
> most remote and isolated corners of this country....control MUST not be an
> option!
>
> The Kenyan consumer continues to be constrained by availability,
> accessibility and affordability to fully realize the socio-economic
> benefits of telecoms.
>
> As a voice for the common consumer.....among a million other
> voices......price control is NOT an option!
>
> Edith
>
> ________________
> Edith Ofwona Adera
> Senior Program Specialist
> ICT4D Program and Climate Change & Water Program
> International Development Research Centre | Centre de recherches pour le
> développement international
> Regional Office for Eastern and Southern Africa
> Tel: +254202713160 | Fax/Téléc: +254202711063 | Skype: edithadera
> eadera at idrc.or.ke<mailto:eadera at idrc.or.ke> |
> www.idrc.ca<http://www.idrc.ca/> | www.crdi.ca<http://www.crdi.ca/>
> [https://email.idrc.or.ke/owa/attachment.ashx?id=RgAAAAANayfd3%2b2VQYZo%2flcEcy23BwBGVjMm%2bu2wT5L%2b09sJnJi7AAACCuteAABGVjMm%2bu2wT5L%2b09sJnJi7AB4xzB0cAAAJ&attcnt=1&attid0=EAAMf1dr1NMFTaXab9x9F4f4]
>
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