<html>
<head>
<style><!--
.hmmessage P
{
margin:0px;
padding:0px
}
body.hmmessage
{
font-size: 10pt;
font-family:Tahoma
}
--></style></head>
<body class='hmmessage'><div dir='ltr'>
<p class="newstype" style="margin-bottom: 5px; padding-left: 13px; line-height: 1.5em; text-transform: uppercase; font-weight: bold; color: rgb(51, 51, 51); background-image: url(http://www.businessdailyafrica.com/image/view/-/539614/data/85/-/10r7mmuz/-/ico_file.png); font-family: Tahoma, Geneva, sans-serif; background-position: 0px 2px; background-repeat: no-repeat no-repeat; ">IN SUMMARY</p><div style="margin: 0px; padding: 0px; color: rgb(68, 68, 68); font-family: Tahoma, Geneva, sans-serif; "><ul style="font-size: 11px; margin-right: 0px; margin-left: 0px; padding-right: 0px; padding-left: 0px; line-height: 1.5em; "><li style="margin: 0px 0px 0px 1.5em; padding: 0px; line-height: 1.5em; ">Two weeks ago, officials from Airtel and Essar�s Yu sought the intervention of President Kibaki and Prime Minister Raila Odinga in the freeze of the Mobile Termination Rate (MTR).</li><li style="margin: 0px 0px 0px 1.5em; padding: 0px; line-height: 1.5em; ">It was the second time that the two operators were seeking such intervention, the first was in June last year.</li><li style="margin: 0px 0px 0px 1.5em; padding: 0px; line-height: 1.5em; ">The industry regulator, the Communications Commission of Kenya (CCK), also found itself in a dilemma, especially after the Consumer Federation of Kenya (Cofek) issued a warning that it would sue CCK if the regulator implemented a lower MTR before a fresh study is conducted.</li><li style="margin: 0px 0px 0px 1.5em; padding: 0px; line-height: 1.5em; ">Both Mr Kibaki and Mr Odinga have indicated that they are keen on the implementation of the MTR after a study has been done, a view held by Safaricom and Telkom�s Kenya Orange in which the government has substantial shares.</li><li style="margin: 0px 0px 0px 1.5em; padding: 0px; line-height: 1.5em; ">On June 8, 2011 Mr Odinga received a report from the taskforce on the Mobile Telephone Industry Business in Kenya. Among the key recommendations made by the taskforce were that CCK undertakes a review of the existing MTR glide path in consultation with operators.</li><li style="margin: 0px 0px 0px 1.5em; padding: 0px; line-height: 1.5em; ">Six days before Mr Odinga received the taskforce�s report, Mr Kibaki had issued a directive to the CCK board freezing further cuts in the MTR.</li><li style="margin: 0px 0px 0px 1.5em; padding: 0px; line-height: 1.5em; ">In appealing to the government, the operators were divided into two opposing camps. Airtel and Yu were pushing for a further reduction in MTR to enable them drive the price war home as a strategy aimed at grabbing more market share. Safaricom and Telkom Kenya were opposed to a reduction in MTR, aware that it could lead to an erosion in their market shares.</li></ul><div><span style="font-size: 11px; line-height: 16.5px;"><br></span></div><div><a href="http://www.businessdailyafrica.com/Corporate+News/Mobile+operators+now+take+the+call+rate+battle+to+Kibaki+Raila/-/539550/1512920/-/item/0/-/eyis9b/-/index.html">http://www.businessdailyafrica.com/Corporate+News/Mobile+operators+now+take+the+call+rate+battle+to+Kibaki+Raila/-/539550/1512920/-/item/0/-/eyis9b/-/index.html</a>
</div></div> </div></body>
</html>