CA hints at changes in final telcos dominance report
Telecommunications companies should expect changed recommendations when the much awaited final report on dominance in the sector is released.
Acting Assistant Director for Market Analysis and Tariffs at the Communications Authority of Kenya (CA), Richard Tonui, Wednesday said the market should expect final recommendations to be different from those in the draft report released in February since the input of more stakeholders has been incorporated.
“So much input has been added. It is now up to the board to say what is okay and what is not. The likely scenario is to adopt it but what is likely to change is direction of a few of the recommendations,” he said at a dialogue forum convened by the Consumers Federation of Kenya (Cofek).
“The complexity of the matter required us to collect information from key stakeholders including Parliament–The board has just concluded looking at it and will be released any time,” added Mr Tonui.
Focus will be on whether -the CA will declare Safaricom a dominant player as had been recommended in the draft report by Analysys Mason, the UK firm that was contracted to evaluate competitiveness in the sector.
The report had also recommended that Safaricom stops on-net discounts and individually tailored loyalty schemes and also share its infrastructure with other networks to reduce barriers to entry.
Safaricom’s market share has been dropping, according to CA data, and now stands at 64.2 per cent, being a six-year low. Regulatory affairs manager at Airtel Kenya Betty Kembo however said the decline should not be misconstrued as a natural correction of the market.
“The market is clearly not competitive. It will be a sorry state to wait for the market to correct itself when there is a regulator. The cost of this study was borne by taxpayers and I don’t see anything that prevents it from being released,” she said.
Her sentiments were echoed by head of public policy at Telkom Kenya Stella Wawira who said other investors are unable to make profit since Safaricom was still enjoying significant market power.
“The telecommunications story in Kenya paints a rosy picture but the story is just about one player. We (Telkom) aren’t making money. We are bleeding money trying to offer choice to consumers,” said Ms Wawira.