[kictanet] Yu acquisition proposal to regulator

Tue Mar 4 12:12:33 EAT 2014

Mark and Listers,

If I were Safaricom, I would do exactly what they are doing and MORE! That is the nature of competition! 
But if the consumer behaved differently.....aka "rational consumer behaviour"......would the competition hold? ....I dont think for long!

Edith
________________________________________
From: Mark Mwangi [mwangy at gmail.com]
Sent: Tuesday, March 04, 2014 1:33 AM
To: Edith Adera
Cc: KICTAnet ICT Policy Discussions
Subject: Re: [kictanet] Yu acquisition proposal to regulator

@Edith the reason it doesn't work here is because of arrogance or incompetence by the competition. There is no reason as to why the small players have not ganged up and built joint infrastructure like 3G networks to rival Safaricom. I have always said hey should push for twin sim phones to make space on peoples phones but the tend to think selling galaxy phones will translate to profits.

Look at Orange. They should have a monopoly on the iPhone game but now Safaricom sell iPhone too.

Airtel treat clients like they are doing hem a favour right from the Kencell days. I don't know what Yu's strategy was.

@Dennis and @Ali I think this is a bad deal and the regulator shouldn't allow it. It will further constrict choice and thus make a mockery of the license grant in the first place.

On Tue, Mar 4, 2014 at 9:08 AM, Edith Adera <eadera at idrc.ca<mailto:eadera at idrc.ca>> wrote:
BIG QUESTION
Why can't Kenya sustain a "multi player" environment?  Ive argued for years that it has to do with peculiar "consumer behaviour" of Kenyans. Open competition has not worked, number portability has not worked.....what will sustain a vibrant multi player environment?

I've just returned from Ghana where the 4+ players have all sorts of offerings whooing consumers left, right and centre...you have all sorts of incentives that seems to keep all players afloat....number portability works etc etc.

Why not Kenya?

What's your take?

Edith
________________________________________
From: kictanet [kictanet-bounces+eadera=idrc.ca at lists.kictanet.or.ke<mailto:idrc.ca at lists.kictanet.or.ke>] on behalf of Ali Hussein [ali at hussein.me.ke<mailto:ali at hussein.me.ke>]
Sent: Monday, March 03, 2014 11:47 PM
To: Edith Adera
Cc: KICTAnet ICT Policy Discussions
Subject: Re: [kictanet] Yu acquisition proposal to regulator

Dennis

Couldn't agree with you more.

In this particular case the regulator will do best to stand down and let market forces play out.

Ali Hussein

+254 0770 906375<tel:%2B254%200770%20906375> / 0713 601113<tel:0713%20601113>

"I fear the day technology will surpass human interaction. The world will have a generation of idiots".  ~ Albert Einstein

Sent from my iPad

On Mar 4, 2014, at 7:18 AM, Dennis Kioko <dmbuvi at gmail.com<mailto:dmbuvi at gmail.com><mailto:dmbuvi at gmail.com<mailto:dmbuvi at gmail.com>>> wrote:

I thought Kenya was a liberal country, what's with everyone wanting to place regulatory hurdles on Yu's exit.

Biggest issue is Safaricom's acquisition of spectrum belonging to YU and thus putting more spectrum under them - which they badly need to improve network quality in urban areas which suffer from congestion.

Industry analysts have long predicted consolidation of MNOs in African countries to 3 or 4 per country (see an interview I did with Coleago in December http://www.cio.co.ke/news/main-stories/coleago's-chris-gives-insights-on-lte-network-sharing,-spectrum,-future-and-regulation-of-africa-telecoms# )

The buy out paves the way for licensing of MVNOs, which have an advantage of sharing existing capacity and unutilised resources rather than building out whole networks again.

On 4 Mar 2014 05:32, "Ali Hussein" <ali at hussein.me.ke<mailto:ali at hussein.me.ke><mailto:ali at hussein.me.ke<mailto:ali at hussein.me.ke>>> wrote:
Listers

Yu has been bleeding red ink since it launched. It was inevitable. No public review will change that. The Network Effect is clearly at play here with Safaricom. None of the other players are profitable. Orange is being kept afloat by GoK and the mother company in France. Airtel considers Kenya a loss leader because of its 'strategic' nature in Africa and hence cannot abandon it. Not sure how long that will continue.

The interesting bit here is that Orange may eventually buy Safaricom because of some actions in far off cities that we have no control over...that for me is the real risk..

Ali Hussein

+254 0770 906375<tel:%2B254%200770%20906375><tel:%2B254%200770%20906375> / 0713 601113<tel:0713%20601113><tel:0713%20601113>

"I fear the day technology will surpass human interaction. The world will have a generation of idiots".  ~ Albert Einstein

Sent from my iPad

On Mar 3, 2014, at 11:20 PM, ICT Researcher <ict.researcher at yahoo.com<mailto:ict.researcher at yahoo.com><mailto:ict.researcher at yahoo.com<mailto:ict.researcher at yahoo.com>>> wrote:

For starters, the company's assets true worth need to be independently established and its outstanding liabilities audited. Mere reported "spend a combined $100 million" inflated with 'sweatheart deal' exit premium does not in any way reflect the much lower true worth of the exiting business persons which no doubt a consortium of Kenyans investors can raise and potentially enable consumers to migrate enmasse to 100 p.c. "MKenya Network":-)

On Monday, March 3, 2014 9:44 PM, "Wambua, Christopher" <Wambua at cck.go.ke<mailto:Wambua at cck.go.ke><mailto:Wambua at cck.go.ke<mailto:Wambua at cck.go.ke>>> wrote:
The regulator has just received the application. We are in the process of reviewing the application with a view to deciding the way forward.  It is therefore too early to subject the application to public consultation.

Wambua
Sent from my BlackBerry 10 smartphone.
From: ICT Researcher
Sent: Monday, 3 March 2014 21:11 PM
To: Wambua, Christopher
Reply To: ICT Researcher
Cc: KICTAnet ICT Policy Discussions
Subject: [kictanet] Yu acquisition proposal to regulator

Airtel, Safaricom seek to buy Essar’s Yu in Kenya - Safaricom will get Yu’s infrastructure, while Airtel is expected to acquire Yu’s subscriber base <http://www.livemint.com/Industry/BZZuR21BJsoJf6jksBhnVN/Airtel-Safaricom-seek-to-buy-Kenyan-rival-Essars-Yu.html>

Considering the profoundly adverse Triopoly consumer choice consequences,
Should the regulator not initiate a public consultation before decision making?

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