@Ali,

I will try and explain and bill you later (since I know you can pay).

A Hypothesis is a test-able hunch or if you want, a test-able statement e.g "I am pregnant" or 'My son is clever' or "Safaricom is dominant". These are all testable statements i.e. they are all examples of a hypothesis and they can turn out to be either true or false.

How can we tell if they are true or false?

You design and set up an experiment. And then run some tests. Pregnancy Tests, IQ Tests are widely known tests that are used to resolve the first two hypothesis - with minimal disputes :-)

The Communication Authority must design similar tests to establish if Safcom is dominant. It may not be rocket science, but as Mblayo insinuated, it is not an easy discussion to have - unless you are hide behind tons of international consultant studies :-).

walu.

From: Ali Hussein <ali@hussein.me.ke>
To: Walubengo J <jwalu@yahoo.com>
Cc: KICTAnet ICT Policy Discussions <kictanet@lists.kictanet.or.ke>
Sent: Wednesday, February 1, 2017 4:30 PM
Subject: Re: [kictanet] Airtel Plans Africa Exit - of dominance etc

@Walu

Kizungu kilikuja na meli...Na hakikusimama Mombasa...(English came by sea..and unfortunately it didn't stop in Mombasa where I was born) :-)

Still..I thought we were talking hypothetical not hypothesis... :-) Are they the same? Rescue guys..

Besides which we aren't talking Academics here are we? It's real Fari Fari..(cash) :-)

Having said that I do agree with you Walu. We need to see that Dominance report right about now..

Ali Hussein

Principal

Hussein & Associates

+254 0713 601113

Twitter: @AliHKassim

Skype: abu-jomo

LinkedIn: http://ke.linkedin.com/in/alihkassim

"We are what we repeatedly do. Excellence, therefore, is not an act but a habit." ~ Aristotle

Sent from my iPad

On 1 Feb 2017, at 2:29 PM, Walubengo J <jwalu@yahoo.com> wrote:

@Ali,

In academics, a hypothesis has an equal chance of being true or false.

It is upon the regulator, competitors, subscribers and/ or any other interested to subject the hypothesis through a test - by collecting appropriate evidence and subsequently testing the hypothesis.

The fact that no one has done this, or is yet to carry out the test, should not imply that the hypothesis is false.
Tafakari hayo :-)

Anyway, we shall further interrogate this and many other mobile network questions soon (GG?) when KICTAnet will moderate a 1week session titled 'Talk-2-Safaricom'.

Stay tuned.

walu.

From: Ali Hussein via kictanet <kictanet@lists.kictanet.or.ke>
To: jwalu@yahoo.com
Cc: Ali Hussein <ali@hussein.me.ke>; KICTAnet ICT Policy Discussions <kictanet@lists.kictanet.or.ke>
Sent: Wednesday, February 1, 2017 1:06 PM
Subject: Re: [kictanet] Airtel Plans Africa Exit

Brian

Let me latch on to that word Hypothetical. :-)

According to the English Dictionary this means:-

'Supposed but not necessarily real or true'

Need I say more? :-)

Ali Hussein
Principal
Hussein & Associates
+254 0713 601113

Twitter: @AliHKassim
Skype: abu-jomo
LinkedIn: http://ke.linkedin.com/in/alihkassim

"We are what we repeatedly do. Excellence, therefore, is not an act but a habit." ~ Aristotle

Sent from my iPad

On 1 Feb 2017, at 10:42 AM, Brian Munyao Longwe <blongwe@gmail.com> wrote:

Dear Ali,

Solid points. My premise is that Safaricom has a "hypothetical monopoly" in a number of their product lines. In essence, they can increase their prices on these products by 5-10% and customers wouldn't have an alternative supply/supplier. This is the most basic litmus test for market dominance. (My friends from the legal, regulatory and competition vectors can correct me if I err.) It is a sensitive subject and please accept my apology for diverting from the genesis of this thread (Airtel exit) and belaboring the point regarding Safaricom's (alleged) significant market power. I'll rest my case and leave it to the powers that be to determine the best way forward.

Yours always,

Mblayo

On Wed, Feb 1, 2017 at 4:02 AM, Ali Hussein via kictanet <kictanet@lists.kictanet.or.ke> wrote:
Brian/Barrack

Very true. There could be instances of abuse of Market Power. This doesn't stop us as customers and competitors to point these out. And seeking remedies. There must however be evidence of this and a formal complaint lodged with the Regulator and/or courts.

The Chairman of Airtel is the one who started this particular firestorm of Africa Exit at Davos.

https://www.bloomberg.com/ news/articles/2017-01-20/ airtel-considering-exits- stake-sales-at-some-africa- operations

So no fake news here.

Brian, my major concern about Market Dominance is how we define it and execute remedies against its abuse. The assumption that I simply cannot agree with is that Customers are so dumb that they will continue giving Safaricom a bigger and bigger chunk of their share of the wallet because of coercion and lack of choice. We have choices guys. There are a number of player now that are not even telcos that are starting to chip at Safaricom's Dominance when it comes to mobile money..Not to mention the fact that cash is still king?

I won't even dwell on the other aspects - voice, data etc. the competition is vibrant and competitors coming out of the woodwork. From places we haven't even fathomed yet.

While the other telco competitors are mulling exits and crying foul of skewed playing fields Safaricom is busy sassing out who their next competitors are..

Tafakari hayo (think about that).

Ali Hussein
Principal
Hussein & Associates
+254 0713 601113

Twitter: @AliHKassim
Skype: abu-jomo
LinkedIn: http://ke.linkedin. com/in/alihkassim

"We are what we repeatedly do. Excellence, therefore, is not an act but a habit." ~ Aristotle

Sent from my iPad

On 1 Feb 2017, at 12:10 AM, Barrack Otieno via kictanet <kictanet@lists.kictanet.or.ke > wrote:

Many thanks Mblayo for your insightfull comments.

By the Ali and listers, i heard on Radio Airtel disputing claims that
they are planning to exit the African Market. Seems like we are
dealing with Fake news or what?

Regards

On 1/31/17, Brian Munyao Longwe via kictanet
<kictanet@lists.kictanet.or.ke > wrote:
Hussein,

I agree with you that in a competitive market the stronger will have a
certain level of dominance. However in the telecoms industry, and more
specifically when we talk about a space with a limited number of issued
licenses (call them competitors), things can go very wrong very quickly if
an eye isn't kept on a dominant player with significant market power (SMP)
which can be abused to produce anti-competitive effects. It is also very
necessary to reduce the granularity of analysis almost to the product level
as a company can have varying levels of market dominance across different
ranges of product offerings, a good example is m-pesa which has already
been cited (my guesstimate is that Safaricom has about 98-99% market share
in mobile money). Thereafter a composite of the various dominances(sic)
across various products lines would probably give a fair idea of the extent
to which the company dmoinates overall.

At this point it would be possible to determine whether anti-trust
methodologies, regulatory interventions, policy interventions are
necessary. At the crux of all of this is the strength (and independence) of
the various regulatory authorities (comms regulator, competition authority,
revenue authority et al). And of course underpinning all of this is the
strength of the policy, legislative and statutory frameworks that govern
the space.

IMHO the country is a the mercy of Safaricom's goodwill. All the company
needs is a Trump who will strong-arm all of the actors/players into dancing
to his/her tune...

My two sumuni,

Mblayo

On Tue, Jan 31, 2017 at 12:20 AM, Beryl Aidi via kictanet <
kictanet@lists.kictanet.or.ke> wrote:

Hello everyone,
Interesting debate. And after all the vibrant debate, explanations and
the
likely perception of Safaricom as the bad guys or reaping from policies
skewed to their advantage, for me the Big Q is why is Airtel exiting
other
countries as well? Can it be facing the same issues across the board, or
could it be simply not understanding the African market altogether?
Way back when in the early days, I think they were first to introduce the
concept of sharing airtime called Me2U. I might have seen a TV ad or two
on
NTV and KTN and that was it. Safaricom took the idea, called it Sambaza,
advertized where wananchi were and the rest is history. And the same
pattern repeated itself in many ways, just knowing how to get people's
hearts. Remember the Masai ad?
Sometimes the answers are in the simple things.

Best
Beryl

On Mon, Jan 30, 2017 at 9:44 PM, Ngigi Waithaka via kictanet <
kictanet@lists.kictanet.or.ke> wrote:

Ali,

My very last take on this....

What you refer to, that the market always corrects itself assumes a
pretty fair playing field, in which case, yes!

However, closely associated with market dominance is monopoly tendencies
(stolen from Julius Malema), illegal & underhand business practices and
*ultimately* anti-competitive behaviours!

Lets look back at Microsoft versus everyone else. While Microsoft wasn't
broken up as was initially suggested, they were forced to open up their
API
for the operating system to ensure that every developer using the
Microsoft
Windows API got the exact same API.

They were also forced to unbundle IE from the OS. If you remember
Windows
'98, IE was equivalent to the Windows Shell. You used it upende
usipende!
What did that do to other browsers, it killed them off one by one!

When they unbundled the browser and gave users a choice on the Windows
Platform we got Firefox, Google Chrome et.al.... Innovation

Look to the other side of Microsoft incenstious relationship with Intel
forming the formidable WinTel!

Intel at the height of its anti-competitive behaviour paid Dell more
than
USD 1B *NOT* to use AMD chips which were by then leading in the
processors
war. Remember AMD gave us 64bit computing way ahead of Intel.

It is not hard to imagine what 'illegal' things one would do if you had
a
few Billion shillings to spend against your competitors with no
anti-competition laws. You could:
1. Pay every mobile agent to make sure they never offer services for
other providers apart from yours
2. With you advertising budget running into Bs ensure that your
competition never airs any Ads from your competitors, until you
'approve'
it.
3, with your deep pockets ensure no 'bad' or illegal practices that you
are heavily involved in are mentioned anywhere in the media. If any
media
house airs any, you pull-off your entire media bookings from them until
they 'shika adabu'!
4. Buy the entire usable bandwidth from TEAMS without using it, simply
to
starve your competition until they surrender.
4. Buy the entire stock of your competitions 'bottles' to make sure they
keep on manufacturing news ones every time as opposed to simply
recycling
them.
5. Ensure that no mobile phone provider pre-loads any competing app to
your core apps, whether they are sold on your network on not! If they
do,
you simply cancel all their orders and voila, watu wanashika adabu!
6. Ensure no one even dreams of selling dual-sim phones through your
network... yeah, this one was hilarious & true!

Point is, Market dominance that ultimately leads to anti-competitive
behaviour, which ultimately stifles competition.

Think about it, what-if, just before M-Pesa launched, Airtel Kenya which
I think was at par with Safaricom then, called their lobbyist and handed
them some seriously loaded brown envelopes to kill of the then nascent
mobile money transfer technology, where would we be today?

And that's why I shuddered when Equity came up with the novel idea of
using SIM Card overlays, which Safaricom fought tooth and nail to stop,
including using serious FUD, the Courts, Government bureaucracy et.al
to stop an idea whose time had come!

Equitel was *lucky* to see the next day. You could argue they had deep
pockets!

But, what of that kid in campus who comes up with MPesa reloaded, will
he
survive the onslaught? What if WhatsApp was a Kenyan firm, threatening
to
take away crucial revenue from SMS from Safaricom as an example?

Would they have been allowed to thrive?

How many 'ICT practitioners' would have come out of the woodwork to
claim
that this technology was 'unsafe', 'untested', 'unregulated'?

How many media outlets would have covered their success stories without
fear of antagonizing their loaded telco customers?

How many phone providers would have dared to be been 'seen' to
advertising Whatsapp on their phones?

List goes on & on.

My point is, market dominance without very solid & well implemented
anti-competition laws stifles innovation big time.

P.S
Every scenario I have picked on, on what I would do if I had a few Bs to
smoother my competition is hypothetical and likeness to any real
scenario
is by mere inter-galactic coincidence :-)

Rgds

On Mon, Jan 30, 2017 at 12:22 PM, Ali Hussein via kictanet <
kictanet@lists.kictanet.or.ke> wrote:

Job

I believe you are referring to two phenomena that are becoming common
place today:-

1. Interoperability - This implies open standards, ability of systems
to
talk to each other seamlessly. My prediction is this:- any company that
doesn't adhere to this thinking will be dead in less than 3 years. The
new
Mantra in Business is *Platform Thinking*. I advise you read this
article in HBR:-

https://hbr.org/2016/04/ pipelines-platforms-and-the- new-rule
s-of-strategy

2. The Network Effect. In economics and business the *network effect*
(also
called *network externality* or *demand-side economies of scale*) is
the effect that one user of a good or service has on the value of that
product to other people. When a network effect is present, the value of
a
product or service is dependent on the number of others using it.
(Wikipedia)

This simply means that Safaricom has been better at executing than the
competition.

Let's look at Equity Bank for a moment. They partnered with Safaricom
initially with their Mkesho Product. We know that story. It simply
didn't
go well.

So what did Equity do? Moan? Complain about Safaricom's Dominance or
unfairness? Or cry foul on legislation? We know that story too. Today
Safaricom understands one thing. They have a serious competitor in
Equity.

That's how the game is played people. If you wait for the galaxies to
align for you then you better roll over and play for dead. Because we
all
know that if you want to be the Big Cajuna in the room - You make the
Galaxies align for you.

As my son keeps on remind me - Don't hate the Player...Hate the
Game..and change it!! :-)

*Ali Hussein*
*Principal*
*Hussein & Associates*
+254 0713 601113 <+254%20713%20601113>

Twitter: @AliHKassim

Skype: abu-jomo

LinkedIn: http://ke.linkedin.com/in/ alihkassim

"We are what we repeatedly do. Excellence, therefore, is not an act but
a habit." ~ Aristotle

Sent from my iPad

On 30 Jan 2017, at 12:02 PM, Job Muriuki <muriukin@gmail.com> wrote:

Ali,

I mean they open up Mpesa and they pay loyalties.
Currently, it's like been paid with Barclays bank cheque while you bank
with CBA and the two don't honour foreign cheques so you are forced to
open
a Barclays account and before you know it you end up not banking with
CBA
altogether. Not that Barclays has better services but somehow you have
been
arm twisted to using them.

Regards,
Job Muriuki,

Skype: heviejob

On Mon, Jan 30, 2017 at 11:43 AM, Ali Hussein <ali@hussein.me.ke>
wrote:

Job

Are you suggesting that Safaricom just 'gives' competitors access to
their platform without them paying for it? Surely not...

This is akin to you saying that now that Tesla has become dominant in
Electric Cars they should give up their technology to those
Neanderthals in
Detroit (GM, Ford etc) simply because they slept through the
revolution.
Literally.

I'd agree with you on this principle if you said that it makes very
good strategic sense for them to open up Mpesa as a Platform. That is
something I think that Safaricom will regret if they don't. But then
it's
their prerogative.

*Ali Hussein*
*Principal*
*Hussein & Associates*
+254 0713 601113 <+254%20713%20601113>

Twitter: @AliHKassim

Skype: abu-jomo

LinkedIn: http://ke.linkedin.com/in/ alihkassim

"We are what we repeatedly do. Excellence, therefore, is not an act
but
a habit." ~ Aristotle

Sent from my iPad

On 30 Jan 2017, at 10:58 AM, Job Muriuki via kictanet <
kictanet@lists.kictanet.or.ke> wrote:

Ngigi,

It's like you are reading from the same script as I am. I have never
understood why we can't use Mpesa on any other number other than a
Safaricom one.
If Airtel, et al got access to the M-pesa platform then the tale would
be very different. As long as Safaricom has exclusivity access to
M-pesa the rest will have an uphill task in making any headways in the
telecom market in Kenya.

Regards,
Job Muriuki,

Skype: heviejob

On Mon, Jan 30, 2017 at 10:38 AM, Brian Munyao Longwe via kictanet <
kictanet@lists.kictanet.or.ke> wrote:

.....and the way CA (formerly CCK) were hammered when they tried to
do
a market intervention on the basis of Safaricom dominance....SMH....

On Mon, Jan 30, 2017 at 9:20 AM, Ngigi Waithaka via kictanet <
kictanet@lists.kictanet.or.ke> wrote:

Ali,

Analyzing why Safaricom has dominated this market in such Key areas
as Mobile Telephony, Payment Services etc is probably something that
would
qualify for a PHD thesis.

Here's what I know though:
1. Are Safaricom's Customers happy? Answer is, do they have a
choice?
Go back to Microsoft's heyday, were you actually really happy with
Windows
'98? Did you have a *choice*?

2. Yes, Safaricom could have better services than Airtel & Telkom,
although I doubt, having been a user of both Safaricom & Airtel over
15yrs.
Even if they were better, how do you reconcile that they are maybe 4
times
the size of the rest of the competition? Are they 4x better than say
Airtel? I doubt.

Now, onto things MPesa, I think Safaricom does MPesa a great
injustice of not spinning it off. I want MPesa (with all its
associated
services) on my Airtel line.

MPesa needs to be listed on NASDAQ! MPesa needs to be the third
choice globally after VISA & Mastercard!

But there's the not so small matter of who actually owns MPesa!

Onto matters regulation, if I was CBK, I would be very concerned if
one such firm had that much 'power' over the money transfer market.

Rgds

On Mon, Jan 30, 2017 at 9:10 AM, Ali Hussein <ali@hussein.me.ke>
wrote:

Ngigi

:-)

The issue of Mobitelea aside (because we will really never know how
that went down) Safaricom is simply better at everything:-

1. Their lobbying is simply superior and a thing of beauty to
watch.
Lobbying is an acceptable practice the world over. Please don't
complain
when your competitor is doing a better job at it than you..

2. Which industry is Safaricom in? Energy? (Mkopa Solar with 500k
subscribers simply won't have existed without the symbiotic
relationship
they have with Mpesa. And Safaricom skims off the top as per
agreement);
Banking? CBA without Mshwari is a shell; Payments? Lipa na Mpesa is
giving
Visa and Mastercard a run for their money; TV? Zuku is about to feel
real
competition. And the list goes on.

3. I'm keen to see the Dominance Report because I think we need to
expand our thinking. I don't believe there is anyone today who has
Dominance in any particular area at least not in the traditional way
we
have defined Dominance.

4. The thing of course to watch is abuse of Market Dominance. And
this in itself a slippery slop. Once The US Government tried to
break up
Microsoft. What the Government couldn't do the Market did. Free
Markets are
the greatest equalizer.

Let us be careful what we wish for. In as long as the customer is
generally happy we have nothing to fear.

*Ali Hussein*
*Principal*
*Hussein & Associates*
+254 0713 601113 <+254%20713%20601113>

Twitter: @AliHKassim

Skype: abu-jomo

LinkedIn: http://ke.linkedin.com/in/ alihkassim

"We are what we repeatedly do. Excellence, therefore, is not an act
but a habit." ~ Aristotle

Sent from my iPad

On 30 Jan 2017, at 8:29 AM, Ngigi Waithaka <ngigi@at.co.ke> wrote:

Ali,

The only palatable End Game; Equitel buys off Airtel Kenya,
combines
it with Helios stake @Telkom

Massive innovation thereafter would get back some respectable
market
share.

Truth be told, Safaricom's cozzyiness with GoK has helped it along
big time. I dare say if Kencell has ceded 10% to Mobitelea, as
Safaricom
was more than glad to do, we'd probably be speaking a different
story right
now!

What these foreign firms investing in Africa need to remember
is.......

THIS IS AFRICA!
On 28 Jan 2017 8:40 a.m., "Ali Hussein via kictanet" <
kictanet@lists.kictanet.or.ke> wrote:

Listers

Another one bites the dust?

I'm really curious as to whats going on in the Telco sector.

Bharti Airtel has announced that it will be exiting 14 African
countries within a year. The affected countries include: Chad,
Congo,
Gabon, Ghana, Kenya, Madagascar, Malawi, Niger, Nigeria, Rwanda,
Seychelles, Tanzania, Uganda and Zambia.

The telecom operator is faced with poor performance across those
markets. Two years ago, when Airtel began talks to sell off its
operations in Burkina Faso, Chad, Congo Brazzaville and Sierra
Leone to
Orange
<http://mobilityarena.com/ airtel-not-exiting-africa- despite-talks-to-sell-4- networks-to-orange/>,
the company had stated that it wouldn’t be exiting Africa.
Airtel plans Africa exit
<http://mobilityarena.com/ airtel-exit-nigeria-13- african-countries/>

Is the African market too competitive or is the regulatory
environment skewed towards a few players?

*Ali Hussein*

*Principal*

*Hussein & Associates*

Tel: +254 713 601113

Twitter: @AliHKassim

Skype: abu-jomo

LinkedIn: http://ke.linkedin.com/in/ alihkassim
<http://ke.linkedin.com/in/ alihkassim>

13th Floor , Delta Towers, Oracle Wing,

Chiromo Road, Westlands,

Nairobi, Kenya.

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of the
organizations that I work with.

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The Kenya ICT Action Network (KICTANet) is a multi-stakeholder platform
for people and institutions interested and involved in ICT policy and
regulation. The network aims to act as a catalyst for reform in the ICT
sector in support of the national aim of ICT enabled growth and
development.

KICTANetiquette : Adhere to the same standards of acceptable behaviors
online that you follow in real life: respect people's times and
bandwidth,
share knowledge, don't flame or abuse or personalize, respect privacy,
do
not spam, do not market your wares or qualifications.

--
Beryl
****************************** *****************
Darkness cannot put out the Light. It can only make God brighter.
—Author
Unknown.

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The Kenya ICT Action Network (KICTANet) is a multi-stakeholder platform
for people and institutions interested and involved in ICT policy and
regulation. The network aims to act as a catalyst for reform in the ICT
sector in support of the national aim of ICT enabled growth and
development.

KICTANetiquette : Adhere to the same standards of acceptable behaviors
online that you follow in real life: respect people's times and
bandwidth,
share knowledge, don't flame or abuse or personalize, respect privacy, do
not spam, do not market your wares or qualifications.

--
Barrack O. Otieno
+254721325277
+254733206359
Skype: barrack.otieno
PGP ID: 0x2611D86A

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The Kenya ICT Action Network (KICTANet) is a multi-stakeholder platform for people and institutions interested and involved in ICT policy and regulation. The network aims to act as a catalyst for reform in the ICT sector in support of the national aim of ICT enabled growth and development.

KICTANetiquette : Adhere to the same standards of acceptable behaviors online that you follow in real life: respect people's times and bandwidth, share knowledge, don't flame or abuse or personalize, respect privacy, do not spam, do not market your wares or qualifications.

______________________________ _________________
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The Kenya ICT Action Network (KICTANet) is a multi-stakeholder platform for people and institutions interested and involved in ICT policy and regulation. The network aims to act as a catalyst for reform in the ICT sector in support of the national aim of ICT enabled growth and development.

KICTANetiquette : Adhere to the same standards of acceptable behaviors online that you follow in real life: respect people's times and bandwidth, share knowledge, don't flame or abuse or personalize, respect privacy, do not spam, do not market your wares or qualifications.

_______________________________________________
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The Kenya ICT Action Network (KICTANet) is a multi-stakeholder platform for people and institutions interested and involved in ICT policy and regulation. The network aims to act as a catalyst for reform in the ICT sector in support of the national aim of ICT enabled growth and development.

KICTANetiquette : Adhere to the same standards of acceptable behaviors online that you follow in real life: respect people's times and bandwidth, share knowledge, don't flame or abuse or personalize, respect privacy, do not spam, do not market your wares or qualifications.