<table cellspacing="0" cellpadding="0" border="0" ><tr><td valign="top" style="font: inherit;">@Ouma,<br>
<br>
there's always a catch with this internet pricing thing. Remember,
Operators have fixed overheads (e.g. Pre-purchased International
bandwidth over the submarine cables, committed over periods of 10-15yrs
+ Annual Operational Costs). This means, Operators have already sunk in
money and must recoup+ a fair profit.<br>
<br>
The interesting question has always been :- what is the best method of
recovering the investment (ROI) without exploiting the users?<br>
<br>
Option 1:- the bottom of the pyramid approach.<br>
Reduce Internet Price to bare minimum - thus widening the customer base - and subsequently meeting your overheads + profit.<br>
<br>
Option 2:- the top of the pyramid approach<br>Charge highly to a
select(few) group of (affluent?) consumers. You still meet your expenses
+ profit (possibly in a lesser complex/costly way e.g. no need of
hiring a large group of customer service)<br>
<br>
What are the risks for both these options (from an Operator point of view)?<br>
Option 1: <br>
Dropping internet prices, may not necessarily expand your customer base.
The commodity here is internet not Ugali (bread). How many Kenyans have
a sustainable reason to get online beyond the FaceBook generation? Put
differently, why would a Kenyan in rural Kenya (70% of us still live
there) want even an email address? Instead what would happen, is that
your already existing small internet users will harvest the benefit
without increasing the Operators Revenues (hence the rush to fix such
guys with a bandwidth cup to 128K?)<br>
<br>
Option 2:<br>
Charging high prices to quickly recoup your investment works only in a
monopolistic environment. So not an option in the Kenyan market. The
Airtel, Orange et. al.are waiting for such blunders in order to eat
Safcom's breakfast, lunch and dinner.<br>
<br>
Optimum Solution?<br>
I do not know. But am sure it can be found.<br>
<br>
walu.<br>
<br><br>--- On <b>Tue, 7/26/11, Michael Ouma <i><benomnta@yahoo.com></i></b> wrote:<br><blockquote style="border-left: 2px solid rgb(16, 16, 255); margin-left: 5px; padding-left: 5px;"><br>From: Michael Ouma <benomnta@yahoo.com><br>Subject: Re: [kictanet] Lower tariffs lower speed<br>To: jwalu@yahoo.com<br>Cc: "Kictanet" <kictanet@lists.kictanet.or.ke><br>Date: Tuesday, July 26, 2011, 3:01 PM<br><br><div id="yiv33654581"><div style="color: rgb(0, 0, 0); background-color: rgb(255, 255, 255); font-family: times new roman,new york,times,serif; font-size: 12pt;"><div><span>Here's the response from Safarim via Twitter on this issue:</span></div><div><br><span></span></div><div class="yiv33654581tweet-row">
<span class="yiv33654581tweet-user-name">
<a rel="nofollow" class="yiv33654581tweet-screen-name yiv33654581user-profile-link" target="_blank" href="http://twitter.com/#%21/SafaricomLtd" title="Safaricom Limited">SafaricomLtd</a>
<span class="yiv33654581tweet-full-name">Safaricom Limited</span>
</span>
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<span class="yiv33654581reply-icon yiv33654581icon">@</span>
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<div class="yiv33654581tweet-text yiv33654581pretty-link"><a rel="nofollow" class="yiv33654581 yiv33654581twitter-atreply" target="_blank" href="http://twitter.com/MichaelOuma"><span class="yiv33654581at">@</span><span class="yiv33654581at-text">MichaelOuma</span></a> Hi, for the unlimited offer the speeds are upto 128kbps, other bundle speeds are on 3G as before, follow <a rel="nofollow" target="_blank" href="http://t.co/xyw355d" title="http://safaricom.co.ke/index.php/?id=241" class="yiv33654581twitter-timeline-link">bit.ly/g6PDbx</a> MG</div>
</div><div> </div><div>Michael Ouma<br>Journalist<br>Kenya<br>Tel:+254-725-537823<br><br><br><br>"Do not go where the path may lead, but go instead where there is no path and leave a trail," - Ralph Waldo Emerson<br><blockquote style="border-left: 2px solid rgb(16, 16, 255); margin-left: 5px; padding-left: 5px;"><div style="font-family: times new roman,new york,times,serif; font-size: 12pt;"><div style="font-family: times new roman,new york,times,serif; font-size: 12pt;"><font face="Arial" size="2"><hr size="1"><b><span style="font-weight: bold;">From:</span></b> Grace Githaiga <ggithaiga@hotmail.com><br><b><span style="font-weight: bold;">To:</span></b> benomnta@yahoo.com<br><b><span style="font-weight: bold;">Cc:</span></b> kictanet@lists.kictanet.or.ke<br><b><span style="font-weight: bold;">Sent:</span></b> Tuesday, July 26, 2011 2:15 PM<br><b><span style="font-weight: bold;">Subject:</span></b> Re: [kictanet] Lower tariffs lower
speed<br></font><br><div id="yiv33654581">
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Robert<br>
I noticed the reduction immediately the tarrifs went down. Maybe thats the catch. We get a reduction in tarrifs and also on speed! A response from safcom would be in order. <br>
<br>
Rgds<br>
Grace<br><br> <br>-----------------------------------------------------------------------------------<br>If you have the strength to survive, you have the power to succeed. Life is all about choices we make depending upon the situation we are in. Go forth and rule the World!<br><br> <br>
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Date: Tue, 26 Jul 2011 09:04:16 +0100<br>From: robertyawe@yahoo.co.uk<br>Subject: Re: [kictanet] Lower tariffs lower speed<br>CC: kictanet@lists.kictanet.or.ke<br>To: ggithaiga@hotmail.com<br><br>
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<div>Hi,</div>
<div><br></div>
<div>I am experiencing slow access between local site which would rule out the Seacom issue.</div>
<div><br></div>
<div>Regards<br> </div>Robert Yawe<br>KAY System Technologies Ltd<br>Phoenix House, 6th Floor<br>P O Box 55806 Nairobi, 00200<br>Kenya<br><br>
<div>Tel: +254722511225, +254202010696
<div><br></div>
<div style="font-family: times new roman,new york,times,serif; font-size: 12pt;"><br> privacy, do not spam, do not market your wares or qualifications.</div></div></div></div> </div>
</div><br>_______________________________________________<br>kictanet mailing list<br><a rel="nofollow" ymailto="mailto:kictanet@lists.kictanet.or.ke" target="_blank" href="/mc/compose?to=kictanet@lists.kictanet.or.ke">kictanet@lists.kictanet.or.ke</a><br><a rel="nofollow" target="_blank" href="http://lists.kictanet.or.ke/mailman/listinfo/kictanet">http://lists.kictanet.or.ke/mailman/listinfo/kictanet</a><br><br>Unsubscribe or change your options at <a rel="nofollow" target="_blank" href="http://lists.kictanet.or.ke/mailman/options/kictanet/benomnta%40yahoo.com">http://lists.kictanet.or.ke/mailman/options/kictanet/benomnta%40yahoo.com</a><br><br>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.<br><br>KICTANetiquette
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you follow in real life: respect people's times and bandwidth, share knowledge, don't flame or abuse or personalize, respect privacy, do not spam, do not market your wares or qualifications.<br><br></div></div></blockquote></div></div></div><br>-----Inline Attachment Follows-----<br><br><div class="plainMail">_______________________________________________<br>kictanet mailing list<br><a ymailto="mailto:kictanet@lists.kictanet.or.ke" href="/mc/compose?to=kictanet@lists.kictanet.or.ke">kictanet@lists.kictanet.or.ke</a><br><a href="http://lists.kictanet.or.ke/mailman/listinfo/kictanet" target="_blank">http://lists.kictanet.or.ke/mailman/listinfo/kictanet</a><br><br>Unsubscribe or change your options at <a href="http://lists.kictanet.or.ke/mailman/options/kictanet/jwalu%40yahoo.com" target="_blank">http://lists.kictanet.or.ke/mailman/options/kictanet/jwalu%40yahoo.com</a><br><br>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.<br><br>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 not spam, do not market your wares or qualifications.</div></blockquote></td></tr></table>