<html><body><div style="color:#000; background-color:#fff; font-family:HelveticaNeue, Helvetica Neue, Helvetica, Arial, Lucida Grande, Sans-Serif;font-size:12pt">Walu,Listers,<br><br>The primary issue here is one of "merger" which is well defined in the Competition Act,Cap504,Laws of Kenya whose primary role is to promote and safeguard competition...etc etc.<br>.It is a telecommunications issue on secondary basis and CAK will have some role to play.<br>In some countries, they call it "concurrent jurisdiction" and clearly define the relationship between the regulators.It does not seem so in Kenya and the real legal muscle may well lie with the Competition Authority .<br><br>John Kariuki<br><div><span><br></span></div><div style="display: block;" class="yahoo_quoted"> <br> <br> <div style="font-family: HelveticaNeue, Helvetica Neue, Helvetica, Arial, Lucida Grande, Sans-Serif; font-size: 12pt;"> <div style="font-family: HelveticaNeue,
Helvetica Neue, Helvetica, Arial, Lucida Grande, Sans-Serif; font-size: 12pt;"> <div dir="ltr"> <font face="Arial" size="2"> On Tuesday, 4 March 2014, 14:52, Walubengo J <jwalu@yahoo.com> wrote:<br> </font> </div> <div class="y_msg_container">@Ali,<br clear="none"><br clear="none">I think you are refusing to see the efficacy of MPESA in the Safaricom ecosystem. Whereas Voice still contributes their largest profit percentages, this voice market is glued together around the MPESA product.<br clear="none"><br clear="none">Think Microsoft of the last decade. Why was their applications so successful (MS-Word, MS-Excel, MS-Exchange, etc)? Because they were build around their fairly universal and monopolistic Operating System (MS-Windows). In todays world of tablets and Smartphones and CloudComputing, the Operating system of choice has changed (from Microsoft to Android, iOS and CloudServices i.e. TCP/IP).<br
clear="none"><br clear="none">Suddenly Microsoft finds itself exposed on their product lines (Word, Excel, etc) because they have lost the monopoly of the Operating System. Same thing with Safcom. You expose MPESA to real competition, you break their stronghold on the Voice and other data services. That is what I blogged about @<a shape="rect" href="http://tiny.cc/3o36bx" target="_blank">http://tiny.cc/3o36bx </a>(thnx GG for sharing :-)<br clear="none"><br clear="none">Safaricom is clever (that is why they are no. 1) and one can see from their recent industry moves that they are reacting appropriately. What I dont know is if CCK can also their overall game plan and what it means for the industry. Sorry, let me rephrase that - I think CCK can also see the Safaricom game plan, but I am still not sure they have the "oomph" to intervene one way or the other.<br clear="none"><br clear="none">At this point in time, the
game has moved from being "technical", gone through being "economical" and we are now at the stage where the big boys(where are the girls :-() in politics are receiving calls from interested parties on which way the game should end. I dont have moles way up there but ladies and gentlemen this discussion (Yu acquisition) must now at a the Politcal layer.<br clear="none"><br clear="none">You and I can only wait and see - and run to court if we feel aggrieved by the final decisions taken.<br clear="none"><br clear="none">walu.<br clear="none">--------------------------------------------<br clear="none">On Tue, 3/4/14, Ali Hussein <<a shape="rect" ymailto="mailto:ali@hussein.me.ke" href="mailto:ali@hussein.me.ke">ali@hussein.me.ke</a>> wrote:<br clear="none"><br clear="none"> Subject: Re: [kictanet] Yu acquisition proposal to regulator<br clear="none"> To: <a shape="rect" ymailto="mailto:jwalu@yahoo.com"
href="mailto:jwalu@yahoo.com">jwalu@yahoo.com</a><br clear="none"> Cc: "KICTAnet ICT Policy Discussions" <<a shape="rect" ymailto="mailto:kictanet@lists.kictanet.or.ke" href="mailto:kictanet@lists.kictanet.or.ke">kictanet@lists.kictanet.or.ke</a>><br clear="none"> Date: Tuesday, March 4, 2014, 1:42 PM<br clear="none"> <br clear="none"> Edith<br clear="none"> +1.<br clear="none"> Mark, sometimes regulatory action is used as a<br clear="none"> weapon when one has been unable to compete. My take is that<br clear="none"> Mpesa isn't yet the bread and butter of Safaricom. The<br clear="none"> greatest value it has is in its network effect. I suspect<br clear="none"> that Safaricom is already on the hunt for the next big<br clear="none"> thing. They are building out WiMAX networks, engaging<br clear="none"> businesses for computing needs etc. This boring stuff is<br clear="none"> where the money is.<br clear="none"> My take? CAK (CCK) needs to stand
down on this<br clear="none"> one and let the market take its course. After all what else<br clear="none"> does the competition need to be done for them to compete<br clear="none"> with Safaricom? Share out subscribers through legislation? I<br clear="none"> think this isn't a perfect market but the regulator here<br clear="none"> is doing an ok job.. <br clear="none"> <br clear="none"> Ali Hussein<br clear="none"> +254 0770<br clear="none"> 906375 / 0713 601113<br clear="none"> "I fear the day technology will<br clear="none"> surpass human interaction. The world will have a generation<br clear="none"> of idiots". ~ Albert Einstein<br clear="none"> Sent from my iPad<br clear="none"> On Mar 4, 2014, at 12:12 PM, Edith Adera <<a shape="rect" ymailto="mailto:eadera@idrc.ca" href="mailto:eadera@idrc.ca">eadera@idrc.ca</a>><br clear="none"> wrote:<br clear="none"> <br clear="none"> Mark and<br clear="none"> Listers,<br clear="none"> <br
clear="none"> If I were Safaricom, I would do exactly what they are<br clear="none"> doing and MORE! That is the nature of competition! <br clear="none"> But if the consumer behaved differently.....aka<br clear="none"> "rational consumer behaviour"......would the<br clear="none"> competition hold? ....I dont think for long!<br clear="none"> <br clear="none"> Edith<br clear="none"> ________________________________________<br clear="none"> From: Mark Mwangi [<a shape="rect" ymailto="mailto:mwangy@gmail.com" href="mailto:mwangy@gmail.com">mwangy@gmail.com</a>]<br clear="none"> Sent: Tuesday, March 04, 2014 1:33 AM<br clear="none"> To: Edith Adera<br clear="none"> Cc: KICTAnet ICT Policy Discussions<br clear="none"> Subject: Re: [kictanet] Yu acquisition proposal to<br clear="none"> regulator<br clear="none"> <br clear="none"> @Edith the reason it doesn't work here is because<br clear="none"> of arrogance or incompetence by the competition. There is no<br
clear="none"> reason as to why the small players have not ganged up and<br clear="none"> built joint infrastructure like 3G networks to rival<br clear="none"> Safaricom. I have always said hey should push for twin sim<br clear="none"> phones to make space on peoples phones but the tend to think<br clear="none"> selling galaxy phones will translate to profits.<br clear="none"> <br clear="none"> Look at Orange. They should have a monopoly on the<br clear="none"> iPhone game but now Safaricom sell iPhone too.<br clear="none"> <br clear="none"> Airtel treat clients like they are doing hem a favour<br clear="none"> right from the Kencell days. I don't know what Yu's<br clear="none"> strategy was.<br clear="none"> <br clear="none"> @Dennis and @Ali I think this is a bad deal and the<br clear="none"> regulator shouldn't allow it. It will further constrict<br clear="none"> choice and thus make a mockery of the license grant in the<br clear="none"> first
place.<br clear="none"> <br clear="none"> <br clear="none"> On Tue, Mar 4, 2014 at 9:08 AM, Edith Adera <<a shape="rect" ymailto="mailto:eadera@idrc.ca" href="mailto:eadera@idrc.ca">eadera@idrc.ca</a><mailto:<a shape="rect" ymailto="mailto:eadera@idrc.ca" href="mailto:eadera@idrc.ca">eadera@idrc.ca</a>>><br clear="none"> wrote:<br clear="none"> BIG QUESTION<br clear="none"> Why can't Kenya sustain a "multi player"<br clear="none"> environment? Ive argued for years that it has to do<br clear="none"> with peculiar "consumer behaviour" of Kenyans.<br clear="none"> Open competition has not worked, number portability has not<br clear="none"> worked.....what will sustain a vibrant multi player<br clear="none"> environment?<br clear="none"> <br clear="none"> I've just returned from Ghana where the 4+ players<br clear="none"> have all sorts of offerings whooing consumers left, right<br clear="none"> and centre...you have all sorts of
incentives that seems to<br clear="none"> keep all players afloat....number portability works etc<br clear="none"> etc.<br clear="none"> <br clear="none"> Why not Kenya?<br clear="none"> <br clear="none"> What's your take?<br clear="none"> <br clear="none"> Edith<br clear="none"> ________________________________________<br clear="none"> From: kictanet [kictanet-bounces+eadera=<a shape="rect" ymailto="mailto:idrc.ca@lists.kictanet.or.ke" href="mailto:idrc.ca@lists.kictanet.or.ke">idrc.ca@lists.kictanet.or.ke</a><mailto:<a shape="rect" ymailto="mailto:idrc.ca@lists.kictanet.or.ke" href="mailto:idrc.ca@lists.kictanet.or.ke">idrc.ca@lists.kictanet.or.ke</a>>]<br clear="none"> on behalf of Ali Hussein [<a shape="rect" ymailto="mailto:ali@hussein.me.ke" href="mailto:ali@hussein.me.ke">ali@hussein.me.ke</a><mailto:<a shape="rect" ymailto="mailto:ali@hussein.me.ke" href="mailto:ali@hussein.me.ke">ali@hussein.me.ke</a>>]<br clear="none"> Sent:
Monday, March 03, 2014 11:47 PM<br clear="none"> To: Edith Adera<br clear="none"> Cc: KICTAnet ICT Policy Discussions<br clear="none"> Subject: Re: [kictanet] Yu acquisition proposal to<br clear="none"> regulator<br clear="none"> <br clear="none"> Dennis<br clear="none"> <br clear="none"> Couldn't agree with you more.<br clear="none"> <br clear="none"> In this particular case the regulator will do best to<br clear="none"> stand down and let market forces play out.<br clear="none"> <br clear="none"> Ali Hussein<br clear="none"> <br clear="none"> +254 0770 906375<tel:%2B254%200770%20906375> /<br clear="none"> 0713 601113<tel:0713%20601113><br clear="none"> <br clear="none"> "I fear the day technology will surpass human<br clear="none"> interaction. The world will have a generation of<br clear="none"> idiots". ~ Albert Einstein<br clear="none"> <br clear="none"> Sent from my iPad<br clear="none"> <br clear="none"> On Mar 4, 2014, at 7:18
AM, Dennis Kioko <<a shape="rect" ymailto="mailto:dmbuvi@gmail.com" href="mailto:dmbuvi@gmail.com">dmbuvi@gmail.com</a><mailto:<a shape="rect" ymailto="mailto:dmbuvi@gmail.com" href="mailto:dmbuvi@gmail.com">dmbuvi@gmail.com</a>><mailto:<a shape="rect" ymailto="mailto:dmbuvi@gmail.com" href="mailto:dmbuvi@gmail.com">dmbuvi@gmail.com</a><mailto:<a shape="rect" ymailto="mailto:dmbuvi@gmail.com" href="mailto:dmbuvi@gmail.com">dmbuvi@gmail.com</a>>>><br clear="none"> wrote:<br clear="none"> <br clear="none"> <br clear="none"> I thought Kenya was a liberal country, what's with<br clear="none"> everyone wanting to place regulatory hurdles on Yu's<br clear="none"> exit.<br clear="none"> <br clear="none"> Biggest issue is Safaricom's acquisition of<br clear="none"> spectrum belonging to YU and thus putting more spectrum<br clear="none"> under them - which they badly need to improve network<br clear="none"> quality in urban areas which
suffer from congestion.<br clear="none"> <br clear="none"> Industry analysts have long predicted consolidation of<br clear="none"> MNOs in African countries to 3 or 4 per country (see an<br clear="none"> interview I did with Coleago in December <a shape="rect" href="http://www.cio.co.ke/news/main-stories/coleago%27s-chris-gives-insights-on-lte-network-sharing,-spectrum,-future-and-regulation-of-africa-telecoms#" target="_blank">http://www.cio.co.ke/news/main-stories/coleago's-chris-gives-insights-on-lte-network-sharing,-spectrum,-future-and-regulation-of-africa-telecoms#</a><br clear="none"> )<br clear="none"> <br clear="none"> The buy out paves the way for licensing of MVNOs,<br clear="none"> which have an advantage of sharing existing capacity and<br clear="none"> unutilised resources rather than building out whole networks<br clear="none"> again.<br clear="none"> <br clear="none"> On 4 Mar 2014 05:32, "Ali Hussein" <<a shape="rect"
ymailto="mailto:ali@hussein.me.ke" href="mailto:ali@hussein.me.ke">ali@hussein.me.ke</a><mailto:<a shape="rect" ymailto="mailto:ali@hussein.me.ke" href="mailto:ali@hussein.me.ke">ali@hussein.me.ke</a>><mailto:<a shape="rect" ymailto="mailto:ali@hussein.me.ke" href="mailto:ali@hussein.me.ke">ali@hussein.me.ke</a><mailto:<a shape="rect" ymailto="mailto:ali@hussein.me.ke" href="mailto:ali@hussein.me.ke">ali@hussein.me.ke</a>>>><br clear="none"> wrote:<br clear="none"> Listers<br clear="none"> <br clear="none"> Yu has been bleeding red ink since it launched. It was<br clear="none"> inevitable. No public review will change that. The Network<br clear="none"> Effect is clearly at play here with Safaricom. None of the<br clear="none"> other players are profitable. Orange is being kept afloat by<br clear="none"> GoK and the mother company in France. Airtel considers Kenya<br clear="none"> a loss leader because of its 'strategic' nature in<br
clear="none"> Africa and hence cannot abandon it. Not sure how long that<br clear="none"> will continue.<br clear="none"> <br clear="none"> The interesting bit here is that Orange may eventually<br clear="none"> buy Safaricom because of some actions in far off cities that<br clear="none"> we have no control over...that for me is the real<br clear="none"> risk..<br clear="none"> <br clear="none"> Ali Hussein<br clear="none"> <br clear="none"> +254 0770<br clear="none"> 906375<tel:%2B254%200770%20906375><tel:%2B254%200770%20906375><br clear="none"> / 0713<br clear="none"> 601113<tel:0713%20601113><tel:0713%20601113><br clear="none"> <br clear="none"> "I fear the day technology will surpass human<br clear="none"> interaction. The world will have a generation of<br clear="none"> idiots". ~ Albert Einstein<br clear="none"> <br clear="none"> Sent from my iPad<br clear="none"> <br clear="none"> On Mar 3, 2014, at 11:20 PM, ICT
Researcher <<a shape="rect" ymailto="mailto:ict.researcher@yahoo.com" href="mailto:ict.researcher@yahoo.com">ict.researcher@yahoo.com</a><mailto:<a shape="rect" ymailto="mailto:ict.researcher@yahoo.com" href="mailto:ict.researcher@yahoo.com">ict.researcher@yahoo.com</a>><mailto:<a shape="rect" ymailto="mailto:ict.researcher@yahoo.com" href="mailto:ict.researcher@yahoo.com">ict.researcher@yahoo.com</a><mailto:<a shape="rect" ymailto="mailto:ict.researcher@yahoo.com" href="mailto:ict.researcher@yahoo.com">ict.researcher@yahoo.com</a>>>><br clear="none"> wrote:<br clear="none"> <br clear="none"> For starters, the company's assets true worth need<br clear="none"> to be independently established and its outstanding<br clear="none"> liabilities audited. Mere reported "spend a combined<br clear="none"> $100 million" inflated with 'sweatheart deal'<br clear="none"> exit premium does not in any way reflect the much lower true<br
clear="none"> worth of the exiting business persons which no doubt a<br clear="none"> consortium of Kenyans investors can raise and potentially<br clear="none"> enable consumers to migrate enmasse to 100 p.c. "MKenya<br clear="none"> Network":-)<br clear="none"> <br clear="none"> <br clear="none"> <br clear="none"> On Monday, March 3, 2014 9:44 PM, "Wambua,<br clear="none"> Christopher" <<a shape="rect" ymailto="mailto:Wambua@cck.go.ke" href="mailto:Wambua@cck.go.ke">Wambua@cck.go.ke</a><mailto:<a shape="rect" ymailto="mailto:Wambua@cck.go.ke" href="mailto:Wambua@cck.go.ke">Wambua@cck.go.ke</a>><mailto:<a shape="rect" ymailto="mailto:Wambua@cck.go.ke" href="mailto:Wambua@cck.go.ke">Wambua@cck.go.ke</a><mailto:<a shape="rect" ymailto="mailto:Wambua@cck.go.ke" href="mailto:Wambua@cck.go.ke">Wambua@cck.go.ke</a>>>><br clear="none"> wrote:<br clear="none"> The regulator has just received the application. We<br clear="none"> are in
the process of reviewing the application with a view<br clear="none"> to deciding the way forward. It is therefore too early<br clear="none"> to subject the application to public consultation.<br clear="none"> <br clear="none"> Wambua<br clear="none"> Sent from my BlackBerry 10 smartphone.<br clear="none"> From: ICT Researcher<br clear="none"> Sent: Monday, 3 March 2014 21:11 PM<br clear="none"> To: Wambua, Christopher<br clear="none"> Reply To: ICT Researcher<br clear="none"> Cc: KICTAnet ICT Policy Discussions<br clear="none"> Subject: [kictanet] Yu acquisition proposal to<br clear="none"> regulator<br clear="none"> <br clear="none"> <br clear="none"> Airtel, Safaricom seek to buy Essar’s Yu in Kenya -<br clear="none"> Safaricom will get Yu’s infrastructure, while Airtel is<br clear="none"> expected to acquire Yu’s subscriber base <<a shape="rect"
href="http://www.livemint.com/Industry/BZZuR21BJsoJf6jksBhnVN/Airtel-Safaricom-seek-to-buy-Kenyan-rival-Essars-Yu.html" target="_blank">http://www.livemint.com/Industry/BZZuR21BJsoJf6jksBhnVN/Airtel-Safaricom-seek-to-buy-Kenyan-rival-Essars-Yu.html</a>><br clear="none"> <br clear="none"> Considering the profoundly adverse Triopoly consumer<br clear="none"> choice consequences,<br clear="none"> Should the regulator not initiate a public<br clear="none"> consultation before decision making?<br clear="none"> <br clear="none"> <br clear="none"> <br clear="none"> <br clear="none"> <br clear="none"> <br clear="none"> <br clear="none"> <br clear="none"> <br clear="none"> _______________________________________________<br clear="none"> kictanet mailing list<br clear="none"> <a shape="rect" ymailto="mailto:kictanet@lists.kictanet.or.ke" href="mailto:kictanet@lists.kictanet.or.ke">kictanet@lists.kictanet.or.ke</a><mailto:<a shape="rect"
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_______________________________________________<br clear="none"> kictanet mailing list<br clear="none"> <a shape="rect" ymailto="mailto:kictanet@lists.kictanet.or.ke" href="mailto:kictanet@lists.kictanet.or.ke">kictanet@lists.kictanet.or.ke</a><mailto:<a shape="rect" ymailto="mailto:kictanet@lists.kictanet.or.ke" href="mailto:kictanet@lists.kictanet.or.ke">kictanet@lists.kictanet.or.ke</a>><br clear="none"> <a shape="rect" href="https://lists.kictanet.or.ke/mailman/listinfo/kictanet" target="_blank">https://lists.kictanet.or.ke/mailman/listinfo/kictanet</a><br clear="none"> <br clear="none"> Unsubscribe or change your options at <a shape="rect" href="https://lists.kictanet.or.ke/mailman/options/kictanet/mwangy%40gmail.com" target="_blank">https://lists.kictanet.or.ke/mailman/options/kictanet/mwangy%40gmail.com</a><br clear="none"> <br clear="none"> The Kenya ICT Action Network (KICTANet) is a<br clear="none"> multi-stakeholder platform for people
and institutions<br clear="none"> interested and involved in ICT policy and regulation. The<br clear="none"> network aims to act as a catalyst for reform in the ICT<br clear="none"> sector in support of the national aim of ICT enabled growth<br clear="none"> and development.<br clear="none"> <br clear="none"> KICTANetiquette : Adhere to the same standards of<br clear="none"> acceptable behaviors online that you follow in real life:<br clear="none"> respect people's times and bandwidth, share knowledge,<br clear="none"> don't flame or abuse or personalize, respect privacy, do<br clear="none"> not spam, do not market your wares or<br clear="none"> qualifications.<br clear="none"> <br clear="none"> <br clear="none"> <br clear="none"> --<br clear="none"> Regards,<br clear="none"> <br clear="none"> Mark Mwangi<br clear="none"> <br clear="none"> markmwangi.me.ke<<a shape="rect" href="http://markmwangi.me.ke/"
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