[kictanet] Are Regulators punishing 'Dominant Positions' or rewarding mediocrity? Or is this regulatory thinking outdated?

[Ali Hussein]

Listers

Google is on the crosshairs of the European Regulator for behavior unbecoming of a Dominant Position. Reminds us of companies that were dominant and punished by Regulators the world over:-

Remember Microsoft? Intel? Palm? IBM? AT&T? Standard Oil? 

http://adage.com/article/digital/google-face-eu-charges-antitrust-violations/298061/?utm_source=mediaworks&utm_medium=newsletter&utm_campaign=adage&ttl=1429654967

What Regulators couldn't do the Market took care of. I have no problem with Regulation per se. What I have a problem with is this Old-School interpretation of Dominance when the world around us is shifting every second. 

Let's reconfigure our thinking on how we define and execute regulation lest we kill the goose that laid the golden egg.

Take our local Telco space. If we consider Safaricom playing in one space - data and mobile money then we can easily say Yes! It is dominant. But consider this:-

1. Zuku dominates the Triple Play space. No actually, just the two play space. - Paid TV (debatable that they are dominant here with the proliferation of digital TV) and Internet at home. Strong contenders are entering the market led by Jamii and Safaricom. For some reason Zuku has decided to ignore the phone they give you with every installation.

2. Payments space. Lipa Na Mpesa, Equitel, Visa, MasterCard, PesaPal, white label products from Cellulant, Craft Silicon, Jambopay and other players scrambling to claim a share of the billions in the Payments space. So who is dominant? 

3. Remittances:- this is a global $550 billion market with corridors across the world - from source markets in the GCC countries to the U.S. into India, Africa etc. Safaricom does about a billion in remittances, partnering with the likes of Western Union and every bank willing to jump onto the bandwagon. This is not a business that can be geo regulated in Kenya alone but needs a global mindset. 

Regulators (and yes this includes CA, because in my humble opinion we should be the benchmark the world looks up to since it's now not a doubt that we are Ground Zero on innovation in mobile payments) need to balance the need to nurture innovation and protect consumers and trust the market will take care of the rest. 

So instead of every regulator the world over scrambling to be the first to punish 'Dominant Positions' let them instead broadly define and ensure adherence to concepts like Net Neutrality, work with consumer protection agencies/organizations and embrace (really embrace) multi-stakeholderism.

Let them do this and I have a sneaky suspicion that Wanjiku (and her equivalents) the world over will take care of the rest.

Ali Hussein
Hussein & Associates
+254 770 906375 / 0713 601113

Twitter: @AliHKassim
Skype: abu-jomo
LinkedIn: http://ke.linkedin.com/in/alihkassim
Blog: www.alyhussein.com

"Discovery consists in seeing what everyone else has seen and thinking what no one else has thought".  ~ Albert Szent-Györgyi

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