Safaricom content but competition row persists

September 28, 2010
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, NAIROBI, Kenya, Sep 28 – The row in the telecoms industry over the bitterly contested Kenya Information and Communications Regulations 2010 seems far from over.

Even though Safaricom has expressed its satisfaction with the recently revised laws, Zain Kenya has questioned the ability of the appointed consultant, Messrs Frontier Economics which it claimed was a business partner of one of the operators, which may lead an impartial amendment exercise of the regulations

On Tuesday, Safaricom Chief Commercial Officer Peter Arina told reporters that the new set of competition rules introduce fair play in the market without seeking to punish the dominant firms.

“The previous regulations were punitive to Safaricom. We believe that fairness should prevail and the current regulations are as fair as they can be,” the officer said echoing the sentiments of his boss Michael Joseph who held that the government was punishing the operator’s success.

Last week, Zain Kenya MD Rene Meza argued: "We don\’t feel that the changes in the regulations translate to the consensus and views that we had with regards to these laws in Kenya."

While the Safaricom’s rival claimed that the operators were not consulted during the appointment of the consultancy firm, Mr Arina maintained that the Brussels-based firm was an independent professional that was hired by the government to re-look at the controversial laws.

“They (government) appointed a third party consultant who came back, re-looked at the regulations, revised them and proposed them. From where we sit, we are quite satisfied with the way they are,” he emphasised.

According to the recommendations by the Frontier Economics, the regulations need to clearly define what and who constitutes a dominant market player so that they are not seen as targeting one operator.

The publication of the new laws and subsequent implementation are guaranteed to raise a storm from Zain, Telkom Kenya and Essar Telecom that initially pushed for the leveling of the playing field that is currently controlled by Safaricom.

Safaricom’s Chief Commercial Officer spoke when the mobile operator announced a deal with handset manufacturer Nokia that would see them jointly market a new messaging service that provides customers with a new range of email solutions and access to social networking.

To enable their Kenyan consumers enjoy this service, Nokia also introduced a new smart phone, Nokia C3 into the market that will be exclusively available at Safaricom outlets at an opening offer of Sh9,999.

While thanking Nokia for its confidence in their ability to deliver value to customers, Mr Arina reaffirmed the operator’s commitment to partner with firms such as Nokia to ensure that they bring down the cost of data enabled phones, which would in turn spur the growth of their data business.

The cost of smart phones in the market, he said had gone down and so has Internet prices, a move which had seen many more Kenyans increasingly access the internet from their phones.

In the last six months, the officer said they were retailing one Megabyte of bandwidth at Sh8 but for the same amount, customers were getting 10mb pointing to the increased capacity at lower rates.

Most Kenyans would however beg to differ as they have been constantly complaining that the arrival of three fibre optic cables has done little to drive down the connectivity costs, a situation they blame for the low Internet penetration in the country.

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