It turns out that sharing infrastructure in the telecommunications business is problematic and does not offer pre-thought benefits as anticipated.
These concerns have been aired by GSM Association, a trade association that ensures mobile telephony and wireless services are easily accessed on a global scale.
Of concern are policies that are being pursed and analyzed by the Communications Authority of Kenya (CA) regarding sharing of infrastructure among local mobile service providers. It is a questions that is surrounded by multiple information streams, where the regulator dismissed rumours of splitting or performing actions to tame unfair competition from dominant operators. At the same time, there was a preliminary report that recommended detaching of M-PESA services from its mother company, Safaricom by end of 2017 unless mobile interoperability was allowed. This decision, which is yet to be enforced was motivated by Safaricom’s free reign in transaction pricing that did not consider market forces. As results, customers were forced to pay higher tariffs compared to other parts of the world (Safaricom has since revised those tariffs that include zero charges for sending KES 100 or lower).
GSM Association, which was founded in 1987 has published a report does not endorse sharing of infrastructure because it plagues effective competition.
“Policymakers in countries considering a move to a wholesale open access network for 4G services may believe they can achieve greater network coverage compared with models that rely on network competition. However, the research published demonstrates that this is not the case,” said John Giusti, chief regulatory officer, GSMA.
What’s more, the report states that competition is a good thing (obviously) because it compels operators to build robust infrastructure with wider coverage. On the contrary, GSMA points out shared infrastructure has no capacity to meet these strides.
These findings are based on research that examined the performance model or single wholesale network (SWN) in five markets, including Kenya, Mexico, Rwanda, Russia and South Africa.
It has not been determined whether the CA will continue pursuing some of the guidelines it published in 2016 where operators are advised to share up to 30 per cent of new ICT infrastructure.