The competition clause surrounding the operations of Kenya’s mobile telecoms industry was introduced a couple of years ago and in that time, the Communications Authority (CA) is yet to offer guidance regarding the hot matter. On the bright side of things, it appears the wait will be a thing of the past as the ICT watchdog is set to announce its findings on Tuesday 20, 2018.
The findings will be based on a study done by M/s Analysys Mason that was contracted by the CA to look into the competition market in bid to evaluate the competitive landscape in the telecoms industry. Mason, an independent international consultant was tasked to substantiate claims of anti-competitive behaviours and market dominance that continues to curtail the growth of competing players.
The investigations were launched in mid-2016, and a couple of months later, some publications got wind of a preliminary report that allegedly suggested a detachment of Safaricom’s primary money-maker M-PESA from the corporation by the end 2017. Apparently, the suggestion could only be actualized if Safaricom failed to embrace mobile money interoperability. However, interoperability is still undergoing tests, with a possible launch in the near future.
It is worth noting that the preliminary report did not point fingers at Safaricom for taking advantage of its obvious dominance in terms of customer subscriptions and mobile money market share. Rather, it highlighted favouritism toward services that leverage its M-PESA platform to conduct their business, including KCB-MPESA and Commercial Bank of Africa (CBA) that manages M-PESA and M-Shwari services that are deemed anti-competitive.
The suggestions irked Safaricom’s top management. Ensuing discussions were subject to inaccurate information, and this prompted the CA to give its stand. The institution noted that data gathered by Masons was under lock and key and dismissed ‘rumours’ about a n imminent split of products that could be detrimental to key market players. However, the CA reminded us that it has constitutional rights to ensure market dominance does not foster abuse and anticompetitive concerns.
It is apparent the details of the report will spark a heated debate from the public and stakeholders, including telcos such as Airtel Kenya and Telkom (that is about to launch its mobile money product) thanks to M-PESA’s dominance that continues to grow every quarter. The product wields so much power in the Kenyan economy to cause countrywide disruption should it be tampered with.
Industry experts have made several suggestions to regulate the market and make sure other players grow. For instance, the CA has been told to slash high call termination rates. At the moment, all Kenyan carriers charge the same amount to each other.
We will update you of the workshop’s study findings and suggestions from the public in due course.
