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Safaricom boss hits out at Kenyan competition proposals

Safaricom boss hits out at Kenyan competition proposals

The Kenyan regulator’s report into improving competition in Kenya has had its findings savaged by Bob Collymore, CEO of the market’s most dominant operator Safaricom.

In a speech to a National Assembly Committee focused on Kenya’s IT sector, Collymore claimed that the Communications Authority of Kenya’s proposals would “punish” Safaricom subscribers by removing the incentive for competitors to invest more in their networks, and thereby curbing innovation.

The report was commissioned in 2016 and has been put together by UK analyst firm Analysys Mason. It is aimed at finding recommendations for improving competition in Kenya’s mobile money and communications markets – both of which are largely dominated by Safaricom.

Its proposals include limiting Safaricom’s offers and promotions, for example by preventing the operator from rewarding its customers for consuming data. The report also recommends that any new tariffs or permanent offers that Safaricom wishes to introduce should be submitted for review five days prior to launch so the regulator can ascertain whether a “reasonably competent” competitor would be able to match them.

Collymore described the proposals as “effective price controls” and said that they would “raise the applicable rates of Safaricom services, making our services more expensive and forcing them to migrate to competitors’ services on cost consideration rather than on total value proposition.”

The report has been under review for some time, and many of its recommendations have already been implemented. Safaricom must now charge equal rates for calls to customers on its network and rival networks, as well as allowing mobile money interoperability and national roaming.

It has faced several revisions, having made some controversial recommendations such as that Safaricom should spin off its mobile money unit into a business separate from its mobile operations. However, this proposal was struck from the finalised report.

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