I like the comparisons here. Safaricom's success lies in the sustainable BoP focused strategy they rolled-out awhile back; so does Equity's success. Zain's strategy should therefore be a calculated shift from elitist to a BoP focus...not a simple anti-Safaricom or "Vuka" campaign. <div>
<div><br></div><div>Wainaina<br><div><br><br><div class="gmail_quote">On Mon, Aug 30, 2010 at 2:11 PM, Johnstone Ole Turana <span dir="ltr"><<a href="mailto:jturana@ke.nationmedia.com">jturana@ke.nationmedia.com</a>></span> wrote:<br>
<blockquote class="gmail_quote" style="margin:0 0 0 .8ex;border-left:1px #ccc solid;padding-left:1ex;">
<div lang="EN-US" link="blue" vlink="purple">
<div>
<p class="MsoNormal"><span style="font-size:11.0pt;color:#1F497D">Economics aside, the ongoing price wars mirrors the yesteryears
customer battle between Equity Bank and the other banks. When Equity entered
into conventional banking, it broke down all the entry barriers- ‘free account’,
no charges for account maintenance (we all can recall the punitive minimum
balance extortion), and banking the mwananchi. Big banks fought this and gave
Equity one year or so-after all banking was high cost, high end game not for
the villages with erratic income. Few years down the road the others have
abandoned the exclusivity banking and embraced the Bottom of the Pyramid (BoP)
customer. </span></p>
<p class="MsoNormal"><span style="font-size:11.0pt;color:#1F497D">At least now I know for sure I can call and have a decent chat, cross
the t’s and dot the i’s which is good for my provider. </span></p>
<p class="MsoNormal"><span style="font-size:11.0pt;color:#1F497D"> </span></p>
<p class="MsoNormal"><span style="font-size:11.0pt;color:#1F497D">Cheers</span></p>
<p class="MsoNormal"><span style="font-size:11.0pt;color:#1F497D">Ole Turana</span></p>
<p class="MsoNormal"><span style="font-size:11.0pt;color:#1F497D"> </span></p>
<div style="border:none;border-top:solid #B5C4DF 1.0pt;padding:3.0pt 0in 0in 0in">
<p class="MsoNormal"><b><span style="font-size:10.0pt">From:</span></b><span style="font-size:10.0pt">
<a href="mailto:ke-internetusers-bounces@bdix.net" target="_blank">ke-internetusers-bounces@bdix.net</a> [mailto:<a href="mailto:ke-internetusers-bounces@bdix.net" target="_blank">ke-internetusers-bounces@bdix.net</a>] <b>On
Behalf Of </b>Solomon Mburu Kamau<br>
<b>Sent:</b> Monday, August 30, 2010 1:58 PM<br>
<b>To:</b> Sam Gatere<br>
<b>Cc:</b> ke-users; KICTAnet ICT Policy Discussions<br>
<b>Subject:</b> Re: [kictanet] [ke-internetusers] Zain Kenya makes another move</span></p>
</div><div><div></div><div class="h5">
<p class="MsoNormal"> </p>
<p class="MsoNormal" style="margin-bottom:12.0pt"><span style="font-family:"Georgia","serif"">I
always find ot interesting to see people always giving pessimistic views on an
investment. I'm not a shareholder of either Safaricom or Zain, but find this
trend welcome. Zain(Airtel) will make losses in the first round, but then,
let's wait and see what they want to offer to the Kenyan market, as long as the
consumer is the winner. <br>
I don't think the consumer is worried about the losses Zain made, but he/she
wants to communicate using the most affordable pricing in the market. The rest,
to him, are just politics of the corporate world. </span><br>
<br>
Me thinks </p>
<div>
<p class="MsoNormal">On 30 August 2010 13:37, Sam Gatere <<a href="mailto:sam.gatere@gmail.com" target="_blank">sam.gatere@gmail.com</a>> wrote:</p>
<p class="MsoNormal">Moaning about safaricom could be one of the strategies
employed here... but we have to give a little grace to the dominant player
where dealing with 15 million plus clients is no easy task! However it would
also be important to look at the difference in mind set between
Western Investors and those from the East. The former (West) have no
problems making 10 bob profit per call while their counterparts seem
not to mind making 50 cents! We also need to look at this whole price war from
a birds eye view before narrowing down to Kenya. Airtel has 15 networks across
the continent while Safaricom is only in Kenya. Should Airtel make
Nairobi their Africa hub (of which I think it is) they
will definitely up their game in by investing more to make their HQ a
profitable one. Possibly We will see this war move on to the Data arena in not
to long.</p>
<div>
<p class="MsoNormal"> </p>
</div>
<div>
<p class="MsoNormal">Sammy.</p>
<div>
<p class="MsoNormal"> </p>
</div>
<div>
<p class="MsoNormal"> </p>
</div>
<div>
<p class="MsoNormal"> </p>
<div>
<div>
<div>
<p class="MsoNormal">On Mon, Aug 30, 2010 at 12:50 PM, Andrea Bohnstedt <<a href="mailto:andrea.bohnstedt@ratio-magazine.com" target="_blank">andrea.bohnstedt@ratio-magazine.com</a>>
wrote:</p>
</div>
</div>
<blockquote style="border:none;border-left:solid #CCCCCC 1.0pt;padding:0in 0in 0in 6.0pt;margin-left:4.8pt;margin-right:0in">
<div>
<div>
<p class="MsoNormal" style="margin-bottom:12.0pt">That's really the key issue,
isn't it? They won't make money anytime soon - there's the low rates, but also
the fact that they'll have to invest heavily in network and systems. Easy to
moan about Safcom's customers service - but they manage 16m clients. I'm curious
to see if Zain will grow their customer service at the same speed to
accommodate all those new subscribers. <br>
<br>
I also suspect that it'll be mostly very very price sensitive people who will
change - again not the clientele that will earn the company much money. <br>
<br>
In 2008, when Zain had the Vuka tariff (KES8 on and off net, if I remember
correctly), the company made nearly USD90m losses. Last year, USD46m losses. <br>
<br>
I found Mickael Ghossein's statement that 'the market is in a mess' quite
telling. I suspect in this battle of the elephants, Orange and Yu are in most
peril - which could easily contract the market again where subscribers have
less choice. <br>
<br>
Full disclosure: I'm a client with both big companies. There's only so much a
girl can put into her handbag. </p>
<div>
<div>
<div>
<p class="MsoNormal">On 30 August 2010 12:31, Wainaina Mungai <<a href="mailto:wainaina@madeinkenya.org" target="_blank">wainaina@madeinkenya.org</a>>
wrote:</p>
</div>
</div>
<blockquote style="border:none;border-left:solid #CCCCCC 1.0pt;padding:0in 0in 0in 6.0pt;margin-left:4.8pt;margin-right:0in">
<div>
<div>
<p class="MsoNormal">This is a very aggressive and most likely, a huge
loss-making move in the short-run. I hope Zain has a well crafted (<i>sustainable</i>)
longterm strategy. </p>
<div>
<p class="MsoNormal"> </p>
</div>
<div>
<p class="MsoNormal">If they are simply 'playing politics' against a 78% market
leader (Safaricom), then they will eventually price their way out of the Kenyan
market.</p>
</div>
<div>
<p class="MsoNormal"> </p>
</div>
<div>
<p class="MsoNormal"> Kencell losses <b>>>></b> Celtel
losses <b>>>> </b>Zain losses <b>>>> </b>AirTel
losses <b>>>> oblivion (or market leadership)</b></p>
<div>
<p class="MsoNormal"> </p>
</div>
<div>
<p class="MsoNormal">My opinion is not influenced by my 'Safaricom
shareholder/MPESA user' status ;-)</p>
</div>
<div>
<p class="MsoNormal"> </p>
</div>
<div>
<p class="MsoNormal" style="margin-bottom:12.0pt">Wainaina</p>
<div>
<p class="MsoNormal">On Mon, Aug 30, 2010 at 11:43 AM, Alex Gakuru <<a href="mailto:gakuru@gmail.com" target="_blank">gakuru@gmail.com</a>> wrote:</p>
<p class="MsoNormal">BY MICHAEL KARANJA<br>
Updated 13 minutes ago<br>
<br>
NAIROBI, Kenya, Aug 30 - Mobile telephony operator Zain Kenya has<br>
introduced Sh5 and Sh10 denomination airtime vouchers as it steps up<br>
its efforts to capture the mass market.<br>
<br>
The introduction of the new vouchers is seen as a move to make the<br>
operator more accessible to the low-end market after a change in<br>
strategy following the entry of its new shareholders, Bharti Airtel.<br>
<br>
Zain Kenya Managing Director Rene Meza said the move is aimed at<br>
complementing its recent 50 percent reduction of call charges.<br>
<br>
“We are offering a wide range of scratch card denominations to suit<br>
the needs of all individuals. Access to telecommunication services is<br>
no longer a luxury but an integral part of each Kenyan’s<br>
socio-economic needs,” Mr Meza said.<br>
<br>
....<br>
<br>
Read more: <a href="http://www.capitalfm.co.ke/business/Kenyabusiness/Zain-Kenya-makes-another-move-4606.html#ixzz0y4pjzlUG" target="_blank">http://www.capitalfm.co.ke/business/Kenyabusiness/Zain-Kenya-makes-another-move-4606.html#ixzz0y4pjzlUG</a><br>
Under Creative Commons License: Attribution Non-Commercial No Derivatives<br>
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