[kictanet] Consumer protection a means of cutting Safaricom¹s dominance

Wed Feb 22 14:28:44 EAT 2017

Thank you bwana Wambua,

Your input will help us understand the issue in a better way.

Regards
On Feb 22, 2017 1:31 PM, "Wambua, Christopher via kictanet" <
kictanet at lists.kictanet.or.ke> wrote:

> Listers
>
> I  wish to confirm that the consultant, M/s Analysys Mason, has submitted
> the draft findings of the study on *Assessment of competition in  the
> telecommunications sub-sector* to the Authority.  Currently, the draft
> report is undergoing internal review.  Once this process is completed, we
> shall be happy to share the reviewed draft findings with the community for
> comments and further input as part of stakeholder consultation process.
>
> We, therefore, urge for your patience  to allow for the ongoing internal
> processes to be completed.
>
>
> *Christopher Wambua*
>
> Ag. Director/Consumer and Public Affairs | Consumer and Public Affairs
>
>
>
> Tel: +254 20 4242000 <020%204242000>/209
>
> Mobile: +254 703 042209 <0703%20042209>/
>
>              +254 730172209 <0730%20172209>
>
> P.O. Box 14448 Nairobi 00800
>
>
>
> wambua at ca.go.ke Communications Authority of Kenya
> <https://www.facebook.com/CAOKenya?ref=hl> ca_kenya
> <https://twitter.com/CA_Kenya>www.ca.go.ke  <http://www.ca.go.ke/>
>
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>
> From: kictanet <kictanet-bounces+wambua=ca.go.ke at lists.kictanet.or.ke> on
> behalf of KICTAnet Discussions <kictanet at lists.kictanet.or.ke>
> Reply-To: Walubengo J <jwalu at yahoo.com>, KICTAnet Discussions <
> kictanet at lists.kictanet.or.ke>
> Date: Wednesday, February 22, 2017 at 11:28 AM
> To: Christoper Wambua <wambua at ca.go.ke>
> Cc: Walubengo J <jwalu at yahoo.com>
> Subject: Re: [kictanet] Consumer protection a means of cutting
> Safaricom’s dominance
>
> @Barrack,
>
> Unlike columnist Jaindi, i dont have the benefit of the leaked dominance
> report.  So unable to confidently take a position on the report.
>
> However, I partly agree with Ali that the market has changed since the
> KPTC days (of the 1990s). Safaricom, just like Airtel and others may have
> been telecommunication companies then, but today they are more of ICT
> companies than they are traditional telcos (read voice providers).
>
> The regulatory instruments and parameters for managing telcos in the
> 90s/early 2000s are therefore inadequate in dealing with todays dynamic
> ICT/Internet environment. There is need to have new regulatory instruments
> that can adequately interrogate todays ICT markets.
>
> So once I get the dominance report, I would be keen to understand whether
> the Consultants recommendations are informed by a  telco-focused regulatory
> instruments or are based on the new ICT realities. So in answering
> @Barrack, it is difficult to tell whether splitting Safcom is good or not,
> unless we understand what were the methodologies used to arrive at such
> decisions.
>
> So I hope Racheal/CA will give us the detailed official report sooner,
> rather than later.
>
> walu.
>
>
> ------------------------------
> *From:* Ali Hussein via kictanet <kictanet at lists.kictanet.or.ke>
> *To:* jwalu at yahoo.com
> *Cc:* Ali Hussein <ali at hussein.me.ke>; KICTAnet ICT Policy Discussions <
> kictanet at lists.kictanet.or.ke>
> *Sent:* Wednesday, February 22, 2017 6:18 AM
> *Subject:* Re: [kictanet] Consumer protection a means of cutting
> Safaricom’s dominance
>
> Barrack
>
> Im one of those old enough to remember. :-)
>
> However my take is this:-
>
> The markets have evolved so much and the dynamics of innovation, the
> market place and the consumer changed so much that the the Heavy Hand of
> Regulation must now be tampered by the light touch of nurturing and
> encouraging innovation and the market players to act and behave in a
> responsible manner. Failure to which the Market will deal with them in a
> most ruthless manner. The market won't break you up. It will decimate you
> and leave you for the dead. Just ask Telkom Kenya, Posta, Nokia and other
> once 'Dominant' global players.
>
> I think we are focusing on the wrong things. By all means, keep a leash on
> the lean, mean fighting machine that is Safaricom. But also nurture home
> grown players -The PesaPals, the Cellulant, the WayaWayas, the Anganis, the
> Zuku's and Jamiis to ensure that we build such a deep bench of players that
> this Dominance conversation will be placed where it belongs - in the
> dustbins of history.
>
> *Ali Hussein*
> *Principal*
> *Hussein & Associates*
> +254 0713 601113 <0713%20601113>
>
> Twitter: @AliHKassim
> Skype: abu-jomo
> LinkedIn: http://ke.linkedin.com/in/alihkassim
>
> "We are what we repeatedly do. Excellence, therefore, is not an act but a
> habit."  ~ Aristotle
>
>
> Sent from my iPad
>
> On 22 Feb 2017, at 5:27 AM, Barrack Otieno <otieno.barrack at gmail.com>
> wrote:
>
> Hi colleagues,
>
> I need an explanation like a two year old on this whole dominance
> debate. Maybe Walu can help me here. Safaricom was a subsidiary of
> Telkom Kenya focused on the mobile phone (GSM) Segment. Looking back
> into the past and as a result of Liberization, the then giant Kenya
> Posts and Telecommunications Corporation was split into , Telkom
> Kenya, Communications Authority of Kenya (CCK then as the regulator
> and Posta to handle the post office. We need to step back and
> interrogate the real reasons as to why Progress of Telkom Kenya and
> Posta has backfired in a maximum of ten bullet points. On the other
> hand, we also need to figure out how Safaricom (a subsidiary of Telkom
> Kenya which is now a public company bolted out of the stable and
> became a success). My simple questions:
>
> 1. Will a split of Safaricom yield the desired effect?
> 2. Is it in the interest of Safaricom (the company or organization
> that is a legally recognized person by the laws of the land to split
> so as to suit the competition.
> 3. Can someone share case  studies of where this has worked before?
>
> Walu or anyone as old as Kenya Posts and Telecommunication Corporation
> please help.
>
> Following...
>
> On 2/22/17, Ali Hussein via kictanet <kictanet at lists.kictanet.or.ke>
> wrote:
>
> @Mwendwa and all
>
>
> it looks like that's what the consultant is suggesting.
>
>
> Here are two other excerpts from the report that I find interesting:-
>
>
> The most draconian of the prescriptions is the proposal to functionally
>
> separate M-Pesa from Safaricom. This is tantamount to proposing a break-up
>
> of Safaricom because in terms of growth revenues, M-Pesa is on track to
>
> reach 50 per cent of the company’s net revenues. The consultants have also
>
> proposed what they call “mandatory wallet-to wallet interoperability”, a
>
> system where a consumer can keep cloud accounts across the platforms of
>
> different mobile companies, making it possible to move and shift money
>
> between accounts as one chooses.
>
>
> I have said before and I'm happy to repeat this again. Separating M-Pesa
>
> from Safaricom should not be forced on Safaricom. In my humble opinion
>
> Safaricom should by now have done this voluntarily as a strategic
> imperative
>
> to transform itself into the De-Facto National (Regional) Mobile Payment
>
> System. I think the lost opportunity here can be seen by the KBA launching
> a
>
> rival Mobile Platform called PesaLink.
>
>
> The mandatory 'Wallet to Wallet' interoperability is an interesting angle
>
> and needs to seriously be considered. This sort of compliments my point
>
> above.
>
>
> They have also recommended a system that they call “agent to agent
>
> interoperability”, where agents will be able to support multiple mobile
>
> money platforms using what is described in technical language as “a single
>
> float”.
>
>
> This is certainly interesting. In as much as this supports the notion of
>
> 'User or Customer Experience'  I think the Regulator and the Telcos should
>
> work towards ensuring this becomes a reality. In essence this could be a
>
> solution to the allegations that Safaricom discourages its agent network
>
> from dealing with rival Telcos.
>
>
> Lastly, I would largely concur with Jaindi Ksero's conclusion (sort of)
> that
>
> the Consultant has displayed a lack of knowledge in the functioning of our
>
> national payments system. I would however like to add one for the road:-
>
>
> Are our Regulators (CA, CAK and CBK)  prepared to empower, grow and
> regulate
>
> with a light touch the seemingly fluid Telco, Banking, Payments and Fintech
>
> Spaces while ensuring that:-
>
>
> a) They embrace innovation and new thinking while protecting National
>
> Interests and consumers at the same time?
>
>
> b) They work together without resorting to Turf Wars as evidenced in the
>
> tiff between the CA and the CAK in 2015.
>
> http://www.businessdailyafrica.com/Corporate-News/Competition--
> telecoms-watchdogs-to-seek-truce-over-Safaricom-/539550-
> 2707286-lqu5sez/index.html
>
>
> c) They consider creating a Joint Task Force to monitor, encourage and
>
> empower players in the spaces mentioned to become Regional and Global
>
> Players? I have often wondered aloud about the CBK's core mandate of
>
> protecting Depositors' funds and wondered (again aloud) whether this
> mandate
>
> is outdated and that it should be expanded to that of becoming an
> empowering
>
> public entity that encourages research, innovation and entrepreneurship in
>
> the burgeoning convergence of Banking, Telcos, Payments and Fintech Spaces.
>
> d) Regulatory tools need to be rebooted and upgraded to reflect the times.
>
> The current scenarios are such that one doesn't even know anymore which
>
> industry one operates in.
>
>
> This is a plea for the Regulation Mandates to drastically change and
> embrace
>
> the now and the future.
>
>
> Can the Future Czars step up?
>
>
>
> Ali Hussein
>
> Principal
>
> Hussein & Associates
>
> +254 0713 601113 <0713%20601113>
>
>
> Twitter: @AliHKassim
>
> Skype: abu-jomo
>
> LinkedIn: http://ke.linkedin.com/in/alihkassim
>
>
> "We are what we repeatedly do. Excellence, therefore, is not an act but a
>
> habit."  ~ Aristotle
>
>
>
> Sent from my iPad
>
>
> On 21 Feb 2017, at 11:12 PM, Mwendwa Kivuva via kictanet
>
> <kictanet at lists.kictanet.or.ke> wrote:
>
>
> So technically, we want to break up Safaricom so that these companies
>
> can gain some traction  "Airtel, has made cumulative debt to date of
>
> Sh51 billion, according to latest audited accounts for the financial
>
> year 2015. Indeed, in the league of loss makers, only Kenya Airways,
>
> with their Sh54 billion lost in the most recent years, compares to
>
> Airtel. As a matter of fact, the numbers in the company’s annual
>
> accounts show that Airtel is insolvent and only surviving on life
>
> support from the parent company in India. Safaricom’s only other
>
> rival, Orange Telkom, has gone through exceedingly difficult trading
>
> and financial conditions over the past decade. This a firm that is
>
> technically insolvent. It has gone through several episodes of
>
> restructuring that have not materially changed its circumstances."
>
> ______________________
>
> Mwendwa Kivuva, Nairobi, Kenya
>
> twitter.com/lordmwesh
>
>
>
>
>
> On 21 February 2017 at 23:48, Grace Githaiga via kictanet
>
> <kictanet at lists.kictanet.or.ke> wrote:
>
>
> Jaindi Kisero gives us a glimpse of the competition study in the
>
> telecommunication sub-sector undertaken by Ms Analysys Mason on behalf
>
> of
>
> CA. See full article:
>
>
> "I recently came across a report by the consulting group Analysys Mason
>
> entitled "A telecommunication competition market study in Kenya".
>
> Readers
>
> will recall that these consultants were retained by the market regulator
>
> –
>
> the Communications Authority of Kenya – to conduct a study whose results
>
> were to inform the crafting of a new framework for regulating abuse of
>
> market dominance by the big players.
>
>
>
> As expected, one of the key findings of this study is that Safaricom’s
>
> market share in both the mobile communications and mobile money segments
>
> far
>
> exceed the thresholds where firms are typically presumed to be
>
> dominant."
>
>
>
> http://www.nation.co.ke/oped/Opinion/consumer-protection-a-
> means-of-cutting-safaricom-dominance/440808-3822560-jsmlpbz/index.html
>
>
>
>
> Best regards
>
>
>
> Githaiga, Grace
>
>
>
> Co-Convenor
>
> Kenya ICT Action Network (KICTANet)
>
> Twitter:@ggithaiga
>
> Tel: 254722701495 <0722%20701495>
>
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>
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>
> Linkedin: https://www.linkedin.com/in/gracegithaiga
>
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>
>
> "Change only happens when ordinary people get involved, get engaged and
>
> come
>
> together to demand it. I am asking you to believe. Not in my ability to
>
> bring about change – but in yours"---Barrack Obama.
>
>
>
>
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> --
> Barrack O. Otieno
> +254721325277 <0721%20325277>
> +254733206359 <0733%20206359>
> Skype: barrack.otieno
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