The dominance issue in the telco space has come up again, following the Competition Authority of Kenya (CAK) meeting with the Senate Standing Committee on ICT that sought to make a determination about Safaricom’s true standing.
According to the CAK, Parliament should pursue laws that will compel carriers to share their infrastructure, but on a commercial basis.
According to the CAK, Safaricom has not abused its position. This, however, is the opposite of what others think, including the likes of Airtel and Telkom Kenya that have severally cited that their inability to compete with Safaricom is due to the latter’s monopolistic practices.
Nevertheless, the CAK has also highlighted infrastructure sharing could potentially fill existing gaps in terms of competition and offering consumers more value and options.
Safaricom, which rakes in billion in profits every other year, has the financial capacity to invest in its network. It has been outspending the competition. According to the Business Daily, the company invests more than KES 30 billion on its systems every year.
The funds have also allowed it to launch Kenya’s first 5G network, which is live in select parts in Nairobi and Kisumu, with mass rollout expected later on.
The latest stats from the CA (ended Dec 2020) reveal that Safaricom is still on the top of the space. It has more than 39 million mobile subscriptions. Airtel and Telkom have 16.6 million and 3.8 million each – which is about half the number Safaricom commands.
The same lead is noted in the mobile money space. Safaricom has been unmatched for a long time, and by Sept 2020, its market share was at 99 percent. This time around, the CA did not even reveal the specifics of mobile money market share.
Safaricom is also leading the fixed data segment, with more than 243K subscriptions of its Home Fibre product. Telkom Kenya, in comparison, has 4.6K sign ups.
It is for some of these reasons that the CAK has suggested that Parliament should force the market leader to share infrastructure with struggling players.
CAK has suggested a new model in the manner the Universal Service Fund (USF) is used, besides the aforementioned sharing of infrastructure that will allow companies to be on the same level of service deployment, and that no player stays ahead of the curve.
