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Telkom kicks up storm over telco market dominance

Steve Umidha @steveumidha

Telkom Kenya has called for speedy efforts to amend the law to regulate market dominance in mobile telephony, warning the industry could be on the brink of collapse.

The firm yesterday termed the matter urgent, and called on the Communications Authority of Kenya (CA) “to move fast” to allow the industry to compete fairly.

“The regulator needs to move fast on this matter, the situation is urgent. We don’t want a single operator that can dictate industry operations,” said its Telkom chief executive Aldo Mareuse.

Delayed implementation of Telcoms Report on Dominance —whose absence is threatening to level the playing field for small operators according to Mareuse — could also put in danger planned mobile money interoperability test between Telkom and Safaricom cash transfer services, T-kash and M-pesa.

Safaricom and Airtel Kenya debuted cross network money transfer service in April this year, while Telkom was expected to join the foray before year end. Those plans, as it now appears, hinge on the implementation of the dominance study by CA and British firm MS Analysys Mason.

Interoperability is expected to solve difficulties associated with mobile money transactions, where consumers have previously complained of costly and highly tedious processes of sending money across networks with the procedure often tilted in Safaricom’s favour owing to huge transactions tariffs set by the operator.

Small players have long maintained that Competition Authority of Kenya (CAK) and CA should split up Safaricom and M-Pesa into separate stand-alone business units in order to compete favourably and open the market.

Rather than pocketing the proceeds from its innovation, Safaricom has argued that, it has ploughed back revenues to transform itself into the multi-billion firm it is today.

According to the Telkom boss Safaricom’s investments has made the company achieve a level of dominance.

“What we are saying is, if nothing is done to the effect, consumers will be exploited, you will pay more for voice calls and data tariffs alike,” Mareuse said.

He was speaking to journalists in Nairobi while giving the firm’s business strategy since Telkom Kenya embarked on a major brand facelift meant to rival Safaricom and Bharti Airtel.

The firm is in talks with two unnamed parties over partnerships to allow it to sell high speed internet capacity from two undersea data cables that are about to land in the East African nation, Mareuse told Reuters.

The operator, which has been focusing on data to gain market share, distributes capacity from three other undersea cables, using its extensive fibre network in the country.

“The combination of affordable data options, strong network coverage across the country… catering to a data hungry market, has enabled us to become the preferred data network.”

The company says it has the cheapest data plan in the market, offering 2 gigabyte (GB) for Sh99.

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