Collymore defends Safaricom in first public appearance
Safaricom #ticker:SCOM chief executive Bob Collymore has returned to work after a long medical leave that ended with his appearance in Parliament to defend his firm against proposed regulatory action against market dominance.
Mr Collymore appeared before the National Assembly’s ICT committee that is inquiring into Safaricom’s dominance in the telecoms market and the push from competitors that action be taken against the market leader.
The Safaricom CEO has been away in the UK for the past nine months to seek treatment for an undisclosed illness.
“I have been away and this is my first outing on Safaricom’s activities. I am back and even my team didn’t know I am back,” Mr Collymore told MPs.
He dismissed the contents of a report on telecommunications competition that the Communications Authority of Kenya (CA) has used in its quest to declare Safaricom dominant in certain market segments.
Mr Collymore said the Analysys Mason report, which proposes a number of remedies or interventions, bears the risk of punishing Safaricom’s customers and killing competition and creativity in the telecoms market.
“In essence this report seeks to introduce retail price controls on Safaricom’s services. The effect of which will be to raise the applicable rates of Safaricom’s services, thereby making the services more expensive to our customers and forcing them to migrate to competitors’ services based on cost considerations,” he said.
Safaricom further argued that the proposed remedies will create artificial competitive landscape that rewards its competitors and disadvantages the market leader’s customers.
“The recommendation to prohibit individually tailored loyalty schemes and promotions means that Safaricom may not offer loyalty bonuses or promotions for which the qualification criteria require different levels of expenditure or usage by different subscribers in the same category,” Mr Collymore said, adding that the Analysys Mason report erred in seeking to punish dominance instead of abuse of dominance.
Mr Collymore said as a result of Safaricom’s growth, it is now being considered a dominant operator that should be singled out for punishment for simply being successful.
Top on the list of regulatory actions that Safaricom is pushing back against is the proposal that Safaricom should provide national roaming services to competitors for five years.
Mr Collymore said provision of roaming services in the manner proposed by the regulator would reward operators, who have not invested in rolling out base stations throughout the country as all Tier 1 licensees are obligated to do.