[kictanet] Airtel Plans Africa Exit

[Ngigi Waithaka]

Ali,

My very last take on this....

What you refer to, that the market always corrects itself assumes a pretty
fair playing field, in which case, yes!

However, closely associated with market dominance is monopoly tendencies
(stolen from Julius Malema), illegal & underhand business practices and
*ultimately* anti-competitive behaviours!

Lets look back at Microsoft versus everyone else. While Microsoft wasn't
broken up as was initially suggested, they were forced to open up their API
for the operating system to ensure that every developer using the Microsoft
Windows API got the exact same API.

They were also forced to unbundle IE from the OS. If you remember Windows
'98, IE was equivalent to the Windows Shell. You used it upende usipende!
What did that do to other browsers, it killed them off one by one!

When they unbundled the browser and gave users a choice on the Windows
Platform we got Firefox, Google Chrome et.al.... Innovation

Look to the other side of Microsoft incenstious relationship with Intel
forming the formidable WinTel!

Intel at the height of its anti-competitive behaviour paid Dell more than
USD 1B *NOT* to use AMD chips which were by then leading in the processors
war. Remember AMD gave us 64bit computing way ahead of Intel.

It is not hard to imagine what 'illegal' things one would do if you had a
few Billion shillings to spend against your competitors with no
anti-competition laws. You could:
1. Pay every mobile agent to make sure they never offer services for other
providers apart from yours
2. With you advertising budget running into Bs ensure that your competition
never airs any Ads from your competitors, until you 'approve' it.
3, with your deep pockets ensure no 'bad' or illegal practices that you are
heavily involved in are mentioned anywhere in the media. If any media house
airs any, you pull-off your entire media bookings from them until they
'shika adabu'!
4. Buy the entire usable bandwidth from TEAMS without using it, simply to
starve your competition until they surrender.
4. Buy the entire stock of your competitions 'bottles' to make sure they
keep on manufacturing news ones every time as opposed to simply recycling
them.
5. Ensure that no mobile phone provider pre-loads any competing app to your
core apps, whether they are sold on your network on not! If they do, you
simply cancel all their orders and voila, watu wanashika adabu!
6. Ensure no one even dreams of selling dual-sim phones through your
network... yeah, this one was hilarious & true!

Point is, Market dominance that ultimately leads to anti-competitive
behaviour, which ultimately stifles competition.

Think about it, what-if, just before M-Pesa launched, Airtel Kenya which I
think was at par with Safaricom then, called their lobbyist and handed them
some seriously loaded brown envelopes to kill of the then nascent mobile
money transfer technology, where would we be today?

And that's why I shuddered when Equity came up with the novel idea of using
SIM Card overlays, which Safaricom fought tooth and nail to stop, including
using serious  FUD, the Courts, Government bureaucracy et.al to stop an
idea whose time had come!

Equitel was *lucky* to see the next day. You could argue they had deep
pockets!

But, what of that kid in campus who comes up with MPesa reloaded, will he
survive the onslaught? What if WhatsApp was a Kenyan firm, threatening  to
take away crucial revenue from SMS from Safaricom as an example?

Would they have been allowed to thrive?

How many 'ICT practitioners' would have come out of the woodwork to claim
that this technology was 'unsafe', 'untested', 'unregulated'?

How many media outlets would have covered their success stories without
fear of antagonizing their loaded telco customers?

How many phone providers would have dared to be been 'seen' to advertising
Whatsapp on their phones?

List goes on & on.

My point is, market dominance without very solid & well implemented
anti-competition laws stifles innovation big time.

P.S
Every scenario I have picked on, on what I would do if I had a few Bs to
smoother my competition is hypothetical and likeness to any real scenario
is by mere inter-galactic coincidence :-)

Rgds

On Mon, Jan 30, 2017 at 12:22 PM, Ali Hussein via kictanet <
kictanet at lists.kictanet.or.ke> wrote:

> Job
>
> I believe you are referring to two phenomena that are becoming common
> place today:-
>
> 1. Interoperability - This implies open standards, ability of systems to
> talk to each other seamlessly. My prediction is this:- any company that
> doesn't adhere to this thinking will be dead in less than 3 years. The new
> Mantra in Business is *Platform Thinking*. I advise you read this article
> in HBR:-
>
> https://hbr.org/2016/04/pipelines-platforms-and-the-new-rules-of-strategy
>
> 2. The Network Effect. In economics and business the  *network effect* (also
> called *network externality* or *demand-side economies of scale*) is the
> effect that one user of a good or service has on the value of that product
> to other people. When a network effect is present, the value of a product
> or service is dependent on the number of others using it. (Wikipedia)
>
> This simply means that Safaricom has been better at executing than the
> competition.
>
> Let's look at Equity Bank for a moment. They partnered with Safaricom
> initially with their Mkesho Product. We know that story. It simply didn't
> go well.
>
> So what did Equity do? Moan? Complain about Safaricom's Dominance or
> unfairness? Or cry foul on legislation?  We know that story too. Today
> Safaricom understands one thing. They have a serious competitor in Equity.
>
> That's how the game is played people. If you wait for the galaxies to
> align for you then you better roll over and play for dead. Because we all
> know that if you want to be the Big Cajuna in the room - You make the
> Galaxies align for you.
>
> As my son keeps on remind me - Don't hate the Player...Hate the Game..and
> change it!! :-)
>
> *Ali Hussein*
> *Principal*
> *Hussein & Associates*
> +254 0713 601113
>
> 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 30 Jan 2017, at 12:02 PM, Job Muriuki <muriukin at gmail.com> wrote:
>
> Ali,
>
> I mean they open up Mpesa and they pay loyalties.
> Currently, it's like been paid with Barclays bank cheque while you bank
> with CBA and the two don't honour foreign cheques so you are forced to open
> a Barclays account and before you know it you end up not banking with CBA
> altogether. Not that Barclays has better services but somehow you have been
> arm twisted to using them.
>
>
> Regards,
> Job Muriuki,
>
> Skype: heviejob
>
>
>
>
> On Mon, Jan 30, 2017 at 11:43 AM, Ali Hussein <ali at hussein.me.ke> wrote:
>
>> Job
>>
>> Are you suggesting that Safaricom just 'gives' competitors access to
>> their platform without them paying for it? Surely not...
>>
>> This is akin to you saying that now that Tesla has become dominant in
>> Electric Cars they should give up their technology to those Neanderthals in
>> Detroit (GM, Ford etc) simply because they slept through the revolution.
>> Literally.
>>
>> I'd agree with you on this principle if you said that it makes very good
>> strategic sense for them to open up Mpesa as a Platform. That is something
>> I think that Safaricom will regret if they don't. But then it's their
>> prerogative.
>>
>> *Ali Hussein*
>> *Principal*
>> *Hussein & Associates*
>> +254 0713 601113 <+254%20713%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 30 Jan 2017, at 10:58 AM, Job Muriuki via kictanet <
>> kictanet at lists.kictanet.or.ke> wrote:
>>
>> Ngigi,
>>
>> It's like you are reading from the same script as I am. I have never
>> understood why we can't use Mpesa on any other number other than a
>> Safaricom one.
>> If Airtel, et al got access to the M-pesa platform then the tale would be
>> very different. As long as Safaricom has exclusivity access to M-pesa the
>> rest will have an uphill task in making any headways in the telecom market
>> in Kenya.
>>
>>
>> Regards,
>> Job Muriuki,
>>
>> Skype: heviejob
>>
>>
>>
>>
>> On Mon, Jan 30, 2017 at 10:38 AM, Brian Munyao Longwe via kictanet <
>> kictanet at lists.kictanet.or.ke> wrote:
>>
>>> .....and the way CA (formerly CCK) were hammered when they tried to do a
>>> market intervention on the basis of Safaricom dominance....SMH....
>>>
>>> On Mon, Jan 30, 2017 at 9:20 AM, Ngigi Waithaka via kictanet <
>>> kictanet at lists.kictanet.or.ke> wrote:
>>>
>>>> Ali,
>>>>
>>>> Analyzing why Safaricom has dominated this market in such Key areas as
>>>> Mobile Telephony, Payment Services etc is probably something that would
>>>> qualify for a PHD thesis.
>>>>
>>>> Here's what I know though:
>>>> 1. Are Safaricom's Customers happy? Answer is, do they have a choice?
>>>> Go back to Microsoft's heyday, were you actually really happy with Windows
>>>> '98? Did you have a *choice*?
>>>>
>>>> 2. Yes, Safaricom could have better services than Airtel & Telkom,
>>>> although I doubt, having been a user of both Safaricom & Airtel over 15yrs.
>>>> Even if they were better, how do you reconcile that they are maybe 4 times
>>>> the size of the rest of the competition? Are they 4x better than say
>>>> Airtel? I doubt.
>>>>
>>>> Now, onto things MPesa, I think Safaricom does MPesa a great injustice
>>>> of not spinning it off. I want MPesa (with all its associated services) on
>>>> my Airtel line.
>>>>
>>>> MPesa needs to be listed on NASDAQ! MPesa needs to be the third choice
>>>> globally after VISA & Mastercard!
>>>>
>>>> But there's the not so small matter of who actually owns MPesa!
>>>>
>>>> Onto matters regulation, if I was CBK, I would be very concerned if one
>>>> such firm had that much 'power' over the money transfer market.
>>>>
>>>> Rgds
>>>>
>>>> On Mon, Jan 30, 2017 at 9:10 AM, Ali Hussein <ali at hussein.me.ke> wrote:
>>>>
>>>>> Ngigi
>>>>>
>>>>> :-)
>>>>>
>>>>> The issue of Mobitelea aside (because we will really never know how
>>>>> that went down) Safaricom is simply better at everything:-
>>>>>
>>>>> 1. Their lobbying is simply superior and a thing of beauty to watch.
>>>>> Lobbying is an acceptable practice the world over. Please don't complain
>>>>> when your competitor is doing a better job at it than you..
>>>>>
>>>>> 2. Which industry is Safaricom in? Energy? (Mkopa Solar with 500k
>>>>> subscribers simply won't have existed without the symbiotic relationship
>>>>> they have with Mpesa. And Safaricom skims off the top as per agreement);
>>>>> Banking? CBA without Mshwari is a shell; Payments?  Lipa na Mpesa is giving
>>>>> Visa and Mastercard a run for their money; TV? Zuku is about to feel real
>>>>> competition. And the list goes on.
>>>>>
>>>>> 3. I'm keen to see the Dominance Report because I think we need to
>>>>> expand our thinking. I don't believe there is anyone today who has
>>>>> Dominance in any particular area at least not in the traditional way we
>>>>> have defined Dominance.
>>>>>
>>>>> 4. The thing of course to watch is abuse of Market Dominance.  And
>>>>> this in itself a slippery slop. Once The US Government tried to break up
>>>>> Microsoft. What the Government couldn't do the Market did. Free Markets are
>>>>> the greatest equalizer.
>>>>>
>>>>> Let us be careful what we wish for. In as long as the customer is
>>>>> generally happy we have nothing to fear.
>>>>>
>>>>> *Ali Hussein*
>>>>> *Principal*
>>>>> *Hussein & Associates*
>>>>> +254 0713 601113 <+254%20713%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 30 Jan 2017, at 8:29 AM, Ngigi Waithaka <ngigi at at.co.ke> wrote:
>>>>>
>>>>> Ali,
>>>>>
>>>>> The only palatable End Game; Equitel buys off Airtel Kenya, combines
>>>>> it with Helios stake @Telkom
>>>>>
>>>>> Massive innovation thereafter would get back some respectable market
>>>>> share.
>>>>>
>>>>> Truth be told, Safaricom's cozzyiness with GoK has helped it along big
>>>>> time. I dare say if Kencell has ceded 10% to Mobitelea, as Safaricom was
>>>>> more than glad to do, we'd probably be speaking a different story right now!
>>>>>
>>>>> What these foreign firms investing in Africa need to remember is.......
>>>>>
>>>>> THIS IS AFRICA!
>>>>> On 28 Jan 2017 8:40 a.m., "Ali Hussein via kictanet" <
>>>>> kictanet at lists.kictanet.or.ke> wrote:
>>>>>
>>>>>> Listers
>>>>>>
>>>>>> Another one bites the dust?
>>>>>>
>>>>>> I'm really curious as to whats going on in the Telco sector.
>>>>>>
>>>>>> Bharti Airtel has announced that it will be exiting 14 African
>>>>>> countries within a year. The affected countries include: Chad, Congo,
>>>>>> Gabon, Ghana, Kenya, Madagascar, Malawi, Niger, Nigeria, Rwanda,
>>>>>> Seychelles, Tanzania, Uganda and Zambia.
>>>>>>
>>>>>> The telecom operator is faced with poor performance across those
>>>>>> markets. Two years ago, when Airtel began talks to sell off its
>>>>>> operations in Burkina Faso, Chad, Congo Brazzaville and Sierra Leone to
>>>>>> Orange
>>>>>> <http://mobilityarena.com/airtel-not-exiting-africa-despite-talks-to-sell-4-networks-to-orange/>,
>>>>>> the company had stated that it wouldn’t be exiting Africa.
>>>>>> Airtel plans Africa exit
>>>>>> <http://mobilityarena.com/airtel-exit-nigeria-13-african-countries/>
>>>>>>
>>>>>> Is the African market too competitive or is the regulatory
>>>>>> environment skewed towards a few players?
>>>>>>
>>>>>> *Ali Hussein*
>>>>>>
>>>>>> *Principal*
>>>>>>
>>>>>> *Hussein & Associates*
>>>>>>
>>>>>>
>>>>>>
>>>>>> Tel: +254 713 601113
>>>>>>
>>>>>> Twitter: @AliHKassim
>>>>>>
>>>>>> Skype: abu-jomo
>>>>>>
>>>>>> LinkedIn: http://ke.linkedin.com/in/alihkassim
>>>>>> <http://ke.linkedin.com/in/alihkassim>
>>>>>>
>>>>>>
>>>>>> 13th Floor , Delta Towers, Oracle Wing,
>>>>>>
>>>>>> Chiromo Road, Westlands,
>>>>>>
>>>>>> Nairobi, Kenya.
>>>>>>
>>>>>> Any information of a personal nature expressed in this email are
>>>>>> purely mine and do not necessarily reflect the official positions of the
>>>>>> organizations that I work with.
>>>>>>
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>>>>>> ailman/options/kictanet/ngigi%40at.co.ke
>>>>>>
>>>>>> The Kenya ICT Action Network (KICTANet) is a multi-stakeholder
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>>>>>
>>>>
>>>>
>>>> --
>>>> *Regards,*
>>>>
>>>> *Wait**haka Ngigi*
>>>> Chief Executive Officer | Alliance Technologies | MCK Nairobi Synod
>>>> Building
>>>> T +254 20 525 0750 |Office Mobile: +254 716 201061
>>>> <+254%20716%20201061> | M +254 737 811 000
>>>> www.at.co.ke
>>>>
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>>>> sector in support of the national aim of ICT enabled growth and development.
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>>>
>>>
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>>
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>> regulation. The network aims to act as a catalyst for reform in the ICT
>> sector in support of the national aim of ICT enabled growth and development.
>>
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>
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> The Kenya ICT Action Network (KICTANet) is a multi-stakeholder platform
> for people and institutions interested and involved in ICT policy and
> regulation. The network aims to act as a catalyst for reform in the ICT
> sector in support of the national aim of ICT enabled growth and development.
>
> KICTANetiquette : Adhere to the same standards of acceptable behaviors
> online that you follow in real life: respect people's times and bandwidth,
> share knowledge, don't flame or abuse or personalize, respect privacy, do
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>



-- 
*Regards,*

*Wait**haka Ngigi*
Chief Executive Officer | Alliance Technologies | MCK Nairobi Synod Building
T +254 20 525 0750 |Office Mobile: +254 716 201061 | M +254 737 811 000
www.at.co.ke
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