Safaricom Hires a Consultant ahead of Dominance Rules Expected in 2017

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Bob Collymore, Safaricom CEO
Bob Collymore, Safaricom CEO
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In 2015, Bharti Airtel initiated a debate seeking to have Safaricom declared the dominant player in the Telecommunications sector. Airtel Kenya is the second largest player in the Kenyan market. With Safaricom declared as the dominant player in the market, the CA would have a say in the pricing of Safaricom’s tariffs. Airtel said the move would promote a more competitive market where only Safaricom is the profitable player in the industry. Airtel had in 2015 managed to have Safaricom forced to open up its expansive M-Pesa agency network to rivals including Airtel Kenya. At the time, Airtel’s claims received backing from the Communication Authority of Kenya as well as the then CS for ICT, Fred Matiang’i with a set of regulations introduced to parliament for the same.

The debate ended with the office of the Attorney General writing to the ICT Cabinet secretary seeking the withdrawal of the regulations, which had been introduced to Parliament for debate. The AG argued that the regulations be subjected to more discussions by all stakeholders as per a memorandum between the Communication Authority and Competition Authority of Kenya (CAK).

The Communications Authority of Kenya then hired an independent consultant to conduct a dominance study of the ICT sector and report in 18 months. The report by the consultant was to guide the CA in declaring dominance. The findings of the report as well as dominance rules are expected in the First half of 2017. Noting the importance of this, Safaricom has on its own engaged a consultant to  conduct an independent assessment of its dominance in the various segments the telco operates. The consultant is undertaking the study on a segment by segment basis. Safaricom will then act on recommendations of that study.

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