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

[Edith Adera]

Bwana Collymore,

Media reports stated what I said, in the absence of a "media brief" from Safaricom (which could have been shared with stakeholders to state the facts), you are likely to fall into the usual political trap of "I was misquoted".

While the massive investment in state-of-the-art networks is much appreciated, much more needs to be done and price controls will not get us there. You call it "price floors", that is another name for "price control".

The focus is too much on "calls" and "data" (WITHOUT locally relevant content and applications except for M-pesa). We rather need to re-invent yet AGAIN and navigate the unchartered waters of "applications and content" for socio-economic development. We have not even began to scratch the surface. We need to make history in this area as we have done with M-pesa....lets go for volumes...the masses!

We need to unlock the potential of young Kenyan developers to create more "m-pesa type" innovations (after all the "core" of Mpesa was developed by a local Kenyan developer). There are more innovations out there, lets tap into that and believe me we will have enormous multiplier effects - more profits (which means more tax collection for govt as this is the "card" being played now), job creation, socio-economic development....the possibilities are infinitum!

Take time to study the "peculiar" Kenyans and unlesh other innovations to beat competition - In your own words, we need "more empowering technologies and innovations"....we are not yet there.

I'm glad that parliament through the speech of the PM in parliament yesterday concurs that there's no need to interfere with a free and competitive market...not yet!

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/>
________________________________
From: Bob Collymore [BCollymore at Safaricom.co.ke]
Sent: 16 February 2011 11:43
To: Edith Adera
Cc: KICTAnet ICT Policy Discussions
Subject: Re: [kictanet] Price Control in the Telecom Market in Kenya?

To help to inform this debate I'd like to state a few facts.

1 Safaricom did NOT 'take this issue to parliament".  Rather we were invited by the Parliamentary Committee to discuss a range of issues including the price wars.  Other operators were given a similar opportunity a while ago.

2 Safaricom did NOT request retail price control.  We simply pointed out that where predatory price wars were threatening development of the industry, the Governments of Sri Lanka, DRC and most recently Uganda ended up stepping in with price floors.  Those who refuse to learn from the lessons of history are inevitably condemned to die by it.....

3 We attempted to debunk the myth of high Kenyan call charges stating the fact that Kenya has the lowest calling charges across Africa.

4 We explained the simple economics of the company that for 8 years has re-invested it's profits in developing the industry to a level that gives 85% of the Kenyan population access to mobile telephony at a price below the rest of Africa and most of Europe and that has brought empowering technologies and innovations such as M-Pesa to ordinary Kenyans.  For some reason the consequences of this investment by the company is not recognised as empowering but rather as 'enjoying market power'

I am happy to have the debate but please let's do so from a position informed by facts.

Sent from my iPad

On 15 Feb 2011, at 19:44, "Edith Adera" <eadera at idrc.or.ke<mailto:eadera at idrc.or.ke>> wrote:

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
<mailto:eadera at idrc.or.ke>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/>
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