Hi MM - I think the role of CCK should end with refereeing inter-connection rates. Otherwise I do not think there is anything like "the price structure of a call". Operators have different business models, different competencies, different efficiencies, etc. Waudo On Wed, 16 Feb 2011 09:33 +0300, "muriuki mureithi" <mureithi@summitstrategies.co.ke> wrote: Edith you are not alone! But unfortunately this is like a political debate--- the debate will be better informed if CCK which has the mandate can publish the price structure of a call taking into account our situation and the market dynamics . Certainly an operator who is innovative and brings down the ‘cost’ to for example below Ksh 0.50 should be encouraged and protected to price that way , those however charging below ‘cost’ should be shunned because , this business tactic is not overboard and it only takes a while when we have to pay dearly. CCK can and should help an informed debate and confirm if the ‘cost’ figures published by the media were accurate. cheers Muriuki Mureithi Those who bring sunshine to the lives of others cannot keep it from themselves. Sir james m barrie From: kictanet-bounces+mureithi=summitstrategies.co.ke@lists.kictanet.o r.ke [mailto:kictanet-bounces+mureithi=summitstrategies.co.ke@lists.ki ctanet.or.ke] On Behalf Of Edith Adera Sent: 15 February 2011 19:40 To: mureithi@summitstrategies.co.ke Cc: KICTAnet ICT Policy Discussions Subject: [kictanet] Price Control in the Telecom Market in Kenya? Listers, The news I heard today made me wanna shadder! A player with market power asking for price controls in the telecom market? Are we progressing or retrogressing? Telecom Economics dictates otherwise and this must NOT happen in a free and competitive market! Our recent discussions on broadband access just goes to confirm that we are not there yet. We have not yet reached the most remote and isolated corners of this country....control MUST not be an option! The Kenyan consumer continues to be constrained by availability, accessibility and affordability to fully realize the socio-economic benefits of telecoms. As a voice for the common consumer.....among a million other voices......price control is NOT an option! Edith ________________ Edith Ofwona Adera Senior Program Specialist ICT4D Program and Climate Change & Water Program International Development Research Centre | Centre de recherches pour le développement international Regional Office for Eastern and Southern Africa Tel: +254202713160 | Fax/Téléc: +254202711063 | Skype: edithadera [1]eadera@idrc.or.ke | [2]www.idrc.ca | [3]www.crdi.ca Image removed by sender. _______________________________________________ kictanet mailing list kictanet@lists.kictanet.or.ke http://lists.kictanet.or.ke/mailman/listinfo/kictanet This message was sent to: emailsignet@mailcan.com Unsubscribe or change your options at http://lists.kictanet.or.ke/mailman/ options/kictanet/emailsignet%40mailcan.com References 1. mailto:eadera@idrc.or.ke 2. http://www.idrc.ca/ 3. http://www.crdi.ca/

MM/McTim - Sorry I disagree. Interconnection costs are just one component of off-net costs that are INDEPENDENT of other costs of the call. If I was an operator I do not understand why anyone would be interested in my cost structure or why I should give it out. BTW I prefer a situation where even interconnection costs are phased out. Let it be like the banking model where the banks do not add the cost of clearing inter-bank cheques. The cross-traffic cancels itself out. That is, why should I charge you for clearing my 10 cheques and you charge me for clearing my 10 cheques? Waudo On Wed, 16 Feb 2011 10:23 +0300, "muriuki mureithi" <mureithi@summitstrategies.co.ke> wrote: Hi Waudo Refereeing interconnection rates fundamentally assumes a cost structure otherwise the regulator would have no basis of setting and referring the interconnection rates cheers Muriuki Mureithi Those who bring sunshine to the lives of others cannot keep it from themselves. Sir james m barrie From: waudo siganga [mailto:emailsignet@mailcan.com] Sent: 16 February 2011 09:46 To: muriuki mureithi Cc: 'KICTAnet ICT Policy Discussions' Subject: Re: [kictanet] Price Control in the Telecom Market in Kenya? Hi MM - I think the role of CCK should end with refereeing inter-connection rates. Otherwise I do not think there is anything like "the price structure of a call". Operators have different business models, different competencies, different efficiencies, etc. Waudo On Wed, 16 Feb 2011 09:33 +0300, "muriuki mureithi" <mureithi@summitstrategies.co.ke> wrote: Edith you are not alone! But unfortunately this is like a political debate--- the debate will be better informed if CCK which has the mandate can publish the price structure of a call taking into account our situation and the market dynamics . Certainly an operator who is innovative and brings down the ‘cost’ to for example below Ksh 0.50 should be encouraged and protected to price that way , those however charging below ‘cost’ should be shunned because , this business tactic is not overboard and it only takes a while when we have to pay dearly. CCK can and should help an informed debate and confirm if the ‘cost’ figures published by the media were accurate. cheers Muriuki Mureithi Those who bring sunshine to the lives of others cannot keep it from themselves. Sir james m barrie From: kictanet-bounces+mureithi=summitstrategies.co.ke@lists.kictanet.o r.ke [mailto:kictanet-bounces+mureithi=summitstrategies.co.ke@lists.ki ctanet.or.ke] On Behalf Of Edith Adera Sent: 15 February 2011 19:40 To: mureithi@summitstrategies.co.ke Cc: KICTAnet ICT Policy Discussions Subject: [kictanet] Price Control in the Telecom Market in Kenya? Listers, The news I heard today made me wanna shadder! A player with market power asking for price controls in the telecom market? Are we progressing or retrogressing? Telecom Economics dictates otherwise and this must NOT happen in a free and competitive market! Our recent discussions on broadband access just goes to confirm that we are not there yet. We have not yet reached the most remote and isolated corners of this country....control MUST not be an option! The Kenyan consumer continues to be constrained by availability, accessibility and affordability to fully realize the socio-economic benefits of telecoms. As a voice for the common consumer.....among a million other voices......price control is NOT an option! Edith ________________ Edith Ofwona Adera Senior Program Specialist ICT4D Program and Climate Change & Water Program International Development Research Centre | Centre de recherches pour le développement international Regional Office for Eastern and Southern Africa Tel: +254202713160 | Fax/Téléc: +254202711063 | Skype: edithadera [1]eadera@idrc.or.ke | [2]www.idrc.ca | [3]www.crdi.ca Image removed by sender. _______________________________________________ kictanet mailing list kictanet@lists.kictanet.or.ke http://lists.kictanet.or.ke/mailman/listinfo/kictanet This message was sent to: emailsignet@mailcan.com Unsubscribe or change your options at http://lists.kictanet.or.ke/mailman/ options/kictanet/emailsignet%40mailcan.com _______________________________________________ kictanet mailing list kictanet@lists.kictanet.or.ke http://lists.kictanet.or.ke/mailman/listinfo/kictanet This message was sent to: emailsignet@mailcan.com Unsubscribe or change your options at http://lists.kictanet.or.ke/mailman/ options/kictanet/emailsignet%40mailcan.com References 1. mailto:eadera@idrc.or.ke 2. http://www.idrc.ca/ 3. http://www.crdi.ca/

When the market actually functions as it should in providing lower prices and value to the consumer, as is the instance in recent telecoms industry, let the invisible hand do its work. On Wed, Feb 16, 2011 at 9:45 AM, waudo siganga <emailsignet@mailcan.com>wrote:

Hi MM - I think the role of CCK should end with refereeing inter-connection rates. Otherwise I do not think there is anything like "the price structure of a call". Operators have different business models, different competencies, different efficiencies, etc.

Waudo On Wed, 16 Feb 2011 09:33 +0300, "muriuki mureithi" < mureithi@summitstrategies.co.ke> wrote:

Edith you are not alone!

But unfortunately this is like a political debate--- the debate will be better informed if CCK which has the mandate can publish the price structure of a call taking into account our situation and the market dynamics . Certainly an operator who is innovative and brings down the ‘cost’ to for example below Ksh 0.50 should be encouraged and protected to price that way , those however charging below ‘cost’ should be shunned because , this business tactic is not overboard and it only takes a while when we have to pay dearly. CCK can and should help an informed debate and confirm if the ‘cost’ figures published by the media were accurate.

cheers

Muriuki Mureithi

Those who bring sunshine to the lives of others cannot keep it from themselves. Sir james m barrie

From: kictanet-bounces+mureithi=summitstrategies.co.ke@ lists.kictanet.or.ke [mailto:kictanet-bounces+mureithi= summitstrategies.co.ke@lists.kictanet.or.ke] On Behalf Of Edith Adera Sent: 15 February 2011 19:40 To: mureithi@summitstrategies.co.ke Cc: KICTAnet ICT Policy Discussions Subject: [kictanet] Price Control in the Telecom Market in Kenya?

Listers,

The news I heard today made me wanna shadder!

A player with market power asking for price controls in the telecom market? Are we progressing or retrogressing?

Telecom Economics dictates otherwise and this must NOT happen in a free and competitive market! Our recent discussions on broadband access just goes to confirm that we are not there yet. We have not yet reached the most remote and isolated corners of this country....control MUST not be an option!

The Kenyan consumer continues to be constrained by availability, accessibility and affordability to fully realize the socio-economic benefits of telecoms.

As a voice for the common consumer.....among a million other voices......price control is *NOT* an option!

Edith

________________

Edith Ofwona Adera

Senior Program Specialist

ICT4D Program and Climate Change & Water Program

International Development Research Centre | Centre de recherches pour le développement international

Regional Office for Eastern and Southern Africa

Tel: +254202713160 | Fax/Téléc: +254202711063 | Skype: edithadera

eadera@idrc.or.ke | www.idrc.ca | www.crdi.ca

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4 We explained the simple economics of the company that for 8 years has re-invested it's profits in developing the industry to a level that gives 85% of the Kenyan population access to mobile telephony at a price below

Hi Listers This discussion is good and has touched on many sides of the coin. Unfortunately the debates starts , stops and starts again . yet we need to exhaustively deal with the issue and move on. The issue is very important since it is at the core of future development of the country . In many of the instances were are only reacting yet we should be in the forefront to steer national debate --- We used to have town hall debates for such contentious issues and put the matter to bed We need one for these to allow us to put facts on the table and proceed with informed debate Am willing to moderate if there are takers --- cheers Muriuki Mureithi Those who bring sunshine to the lives of others cannot keep it from themselves. Sir james m barrie -----Original Message----- From: kictanet-bounces+mureithi=summitstrategies.co.ke@lists.kictanet.or.ke [mailto:kictanet-bounces+mureithi=summitstrategies.co.ke@lists.kictanet.or.k e] On Behalf Of Eng. Wainaina Mungai Sent: 16 February 2011 14:06 To: mureithi@summitstrategies.co.ke Cc: KICTAnet ICT Policy Discussions Subject: Re: [kictanet] Price Control in the Telecom Market in Kenya? Hi Bob, We cannot deny that Safaricom is "enjoying market power". That ship sailed a while back... and we congratulate the team that built Safaricom into a success story for subscribers; shareholders...and of course, the tax man ;-) . Pricing is not the only issue your clients have....some issues include an unreliable customer care, poor service quality (coverage even in some estates in Nairobi) and a dismissive attitude to customers.... Safaricom used to be a brand "for the people"...and many Kenyans benefited from the value-chain as dealers, retainers...consumers... The script has changed and "Niko na..." brand might end up as an expensive advertising campaign unless Safaricom stops giving corporate and individual subscribers the impression that they need to put up with skewed partnerships "because you are Safaricom". the

rest of Africa and most of Europe and that has brought empowering technologies and innovations such as M-Pesa to ordinary Kenyans. For some reason the consequences of this investment by the company is not recognised as empowering but rather as 'enjoying market power'

To help to inform this debate I'd like to state a few facts.

1 Safaricom did NOT 'take this issue to parliament". Rather we were invited by the Parliamentary Committee to discuss a range of issues including the price wars. Other operators were given a similar opportunity a while ago.

2 Safaricom did NOT request retail price control. We simply pointed out that where predatory price wars were threatening development of the industry, the Governments of Sri Lanka, DRC and most recently Uganda ended up stepping in with price floors. Those who refuse to learn from the lessons of history are inevitably condemned to die by it.....

3 We attempted to debunk the myth of high Kenyan call charges stating the fact that Kenya has the lowest calling charges across Africa.

4 We explained the simple economics of the company that for 8 years has re-invested it's profits in developing the industry to a level that gives 85% of the Kenyan population access to mobile telephony at a price below

On 2/16/11, Bob Collymore <BCollymore@safaricom.co.ke> wrote: the

rest of Africa and most of Europe and that has brought empowering technologies and innovations such as M-Pesa to ordinary Kenyans. For some reason the consequences of this investment by the company is not recognised as empowering but rather as 'enjoying market power'

I am happy to have the debate but please let's do so from a position informed by facts.

Sent from my iPad

On 15 Feb 2011, at 19:44, "Edith Adera" <eadera@idrc.or.ke> wrote:

...

Listers,

The news I heard today made me wanna shadder!

A player with market power asking for price controls in the telecom market? Are we progressing or retrogressing?

Telecom Economics dictates otherwise and this must NOT happen in a free and competitive market! Our recent discussions on broadband access just goes to confirm that we are not there yet. We have not yet reached the most remote and isolated corners of this country....control MUST not be an option!

The Kenyan consumer continues to be constrained by availability, accessibility and affordability to fully realize the socio-economic benefits of telecoms.

As a voice for the common consumer.....among a million other voices......price control is NOT an option!

Edith

________________ Edith Ofwona Adera Senior Program Specialist ICT4D Program and Climate Change & Water Program International Development Research Centre | Centre de recherches pour le développement international Regional Office for Eastern and Southern Africa Tel: +254202713160 | Fax/Téléc: +254202711063 | Skype: edithadera eadera@idrc.or.ke | www.idrc.ca | www.crdi.ca

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-- "What other people think of me, is none of my business" _______________________________________________ kictanet mailing list kictanet@lists.kictanet.or.ke http://lists.kictanet.or.ke/mailman/listinfo/kictanet This message was sent to: mureithi@summitstrategies.co.ke Unsubscribe or change your options at http://lists.kictanet.or.ke/mailman/options/kictanet/mureithi%40summitstrate gies.co.ke

Bwana Collymore, Media reports stated what I said, in the absence of a "media brief" from Safaricom (which could have been shared with stakeholders to state the facts), you are likely to fall into the usual political trap of "I was misquoted". While the massive investment in state-of-the-art networks is much appreciated, much more needs to be done and price controls will not get us there. You call it "price floors", that is another name for "price control". The focus is too much on "calls" and "data" (WITHOUT locally relevant content and applications except for M-pesa). We rather need to re-invent yet AGAIN and navigate the unchartered waters of "applications and content" for socio-economic development. We have not even began to scratch the surface. We need to make history in this area as we have done with M-pesa....lets go for volumes...the masses! We need to unlock the potential of young Kenyan developers to create more "m-pesa type" innovations (after all the "core" of Mpesa was developed by a local Kenyan developer). There are more innovations out there, lets tap into that and believe me we will have enormous multiplier effects - more profits (which means more tax collection for govt as this is the "card" being played now), job creation, socio-economic development....the possibilities are infinitum! Take time to study the "peculiar" Kenyans and unlesh other innovations to beat competition - In your own words, we need "more empowering technologies and innovations"....we are not yet there. I'm glad that parliament through the speech of the PM in parliament yesterday concurs that there's no need to interfere with a free and competitive market...not yet! Edith ________________ Edith Ofwona Adera Senior Program Specialist ICT4D Program and Climate Change & Water Program International Development Research Centre | Centre de recherches pour le développement international Regional Office for Eastern and Southern Africa Tel: +254202713160 | Fax/Téléc: +254202711063 | Skype: edithadera eadera@idrc.or.ke<mailto:eadera@idrc.or.ke> | www.idrc.ca<http://www.idrc.ca/> | www.crdi.ca<http://www.crdi.ca/> ________________________________ From: Bob Collymore [BCollymore@Safaricom.co.ke] Sent: 16 February 2011 11:43 To: Edith Adera Cc: KICTAnet ICT Policy Discussions Subject: Re: [kictanet] Price Control in the Telecom Market in Kenya? To help to inform this debate I'd like to state a few facts. 1 Safaricom did NOT 'take this issue to parliament". Rather we were invited by the Parliamentary Committee to discuss a range of issues including the price wars. Other operators were given a similar opportunity a while ago. 2 Safaricom did NOT request retail price control. We simply pointed out that where predatory price wars were threatening development of the industry, the Governments of Sri Lanka, DRC and most recently Uganda ended up stepping in with price floors. Those who refuse to learn from the lessons of history are inevitably condemned to die by it..... 3 We attempted to debunk the myth of high Kenyan call charges stating the fact that Kenya has the lowest calling charges across Africa. 4 We explained the simple economics of the company that for 8 years has re-invested it's profits in developing the industry to a level that gives 85% of the Kenyan population access to mobile telephony at a price below the rest of Africa and most of Europe and that has brought empowering technologies and innovations such as M-Pesa to ordinary Kenyans. For some reason the consequences of this investment by the company is not recognised as empowering but rather as 'enjoying market power' I am happy to have the debate but please let's do so from a position informed by facts. Sent from my iPad On 15 Feb 2011, at 19:44, "Edith Adera" <eadera@idrc.or.ke<mailto:eadera@idrc.or.ke>> wrote: Listers, The news I heard today made me wanna shadder! A player with market power asking for price controls in the telecom market? Are we progressing or retrogressing? Telecom Economics dictates otherwise and this must NOT happen in a free and competitive market! Our recent discussions on broadband access just goes to confirm that we are not there yet. We have not yet reached the most remote and isolated corners of this country....control MUST not be an option! The Kenyan consumer continues to be constrained by availability, accessibility and affordability to fully realize the socio-economic benefits of telecoms. As a voice for the common consumer.....among a million other voices......price control is NOT an option! Edith ________________ Edith Ofwona Adera Senior Program Specialist ICT4D Program and Climate Change & Water Program International Development Research Centre | Centre de recherches pour le développement international Regional Office for Eastern and Southern Africa Tel: +254202713160 | Fax/Téléc: +254202711063 | Skype: edithadera <mailto:eadera@idrc.or.ke>eadera@idrc.or.ke<mailto:eadera@idrc.or.ke> | www.idrc.ca<http://www.idrc.ca/> | www.crdi.ca<http://www.crdi.ca/> _______________________________________________ kictanet mailing list kictanet@lists.kictanet.or.ke<mailto:kictanet@lists.kictanet.or.ke> http://lists.kictanet.or.ke/mailman/listinfo/kictanet This message was sent to: <mailto:BCollymore@safaricom.co.ke> BCollymore@safaricom.co.ke<mailto:BCollymore@safaricom.co.ke> Unsubscribe or change your options at <http://lists.kictanet.or.ke/mailman/options/kictanet/bcollymore%40safaricom.co.ke> http://lists.kictanet.or.ke/mailman/options/kictanet/bcollymore%40safaricom.... Note: All emails sent from Safaricom Limited are subject to Safaricom�s Email Terms & Conditions. Please click here<http://www.safaricom.co.ke/index.php?id=954> to read the policy. ________________________________ [http://www.safaricom.co.ke/fileadmin/signaturefiles/MpesaTip1.JPG]

Bwana Ndemo, While I agree with most of your analysis (not all), could you please be SPECIFIC on what your "conservative stand" is? That would allow appropriate response. In the meantime, we need to keep in mind what drives innovation - the insatiable desire to survive (NOT TO DIE) rather than "protection"!! Lets support innovation rather than protection! Edith PS: who should be the "objective" arbitatrator given Government's stake in Safaricom? or was it all sold? _______________ Edith Ofwona Adera Senior Program Specialist ICT4D Program and Climate Change & Water Program International Development Research Centre | Centre de recherches pour le développement international Regional Office for Eastern and Southern Africa Tel: +254202713160 | Fax/Téléc: +254202711063 | Skype: edithadera eadera@idrc.or.ke | www.idrc.ca | www.crdi.ca ________________________________________ From: bitange@jambo.co.ke [bitange@jambo.co.ke] Sent: 16 February 2011 11:58 To: Edith Adera Cc: bitange@jambo.co.ke; KICTAnet ICT Policy Discussions Subject: Re: [kictanet] Price Control in the Telecom Market in Kenya? Edith, Prices will eventually come down even below one shilling especially when Subscriber base begins to exceed 100%. It is selfish for us now to celebrate lower tarrifs when coverage is at 40%. We need to improve coverage to at least 90%. There are pockets even in Nairobi where none of the operators has covered. The quality of service is still wanting as new technologies that put pressure on capex keep on emerging. We are not seeing aggresive rollout of 3G which all of you agree that it is critical to our last mile broadband. For many years, Kenya's development has largely been minimalist, depressing and expensive. In the past few years, we started moving from such experiments and made serious interventions in the Telcoms and Road sectors. Serious investors are now considering Kenya as a good investment destination. Other consideration include return on investment not only for foreign investors but local investors too. Margins therefore become a critical factor. There is no where in the world where lower margins have kept pace with technology. Any analyst will tell you that at the pace which prices are coming down in Kenya, one operator is bound to die. Unfortunately, most of the celebrating crowd will train their spears on government asking what it was doing. Whichever way the government gets the flak. That is why I make no apologies for taking a conservative stand. Regards Ndemo.

Listers,

The news I heard today made me wanna shadder!

A player with market power asking for price controls in the telecom market? Are we progressing or retrogressing?

Telecom Economics dictates otherwise and this must NOT happen in a free and competitive market! Our recent discussions on broadband access just goes to confirm that we are not there yet. We have not yet reached the most remote and isolated corners of this country....control MUST not be an option!

The Kenyan consumer continues to be constrained by availability, accessibility and affordability to fully realize the socio-economic benefits of telecoms.

As a voice for the common consumer.....among a million other voices......price control is NOT an option!

Edith

________________ Edith Ofwona Adera Senior Program Specialist ICT4D Program and Climate Change & Water Program International Development Research Centre | Centre de recherches pour le développement international Regional Office for Eastern and Southern Africa Tel: +254202713160 | Fax/Téléc: +254202711063 | Skype: edithadera eadera@idrc.or.ke<mailto:eadera@idrc.or.ke> | www.idrc.ca<http://www.idrc.ca/> | www.crdi.ca<http://www.crdi.ca/> [https://email.idrc.or.ke/owa/attachment.ashx?id=RgAAAAANayfd3%2b2VQYZo%2flcEcy23BwBGVjMm%2bu2wT5L%2b09sJnJi7AAACCuteAABGVjMm%2bu2wT5L%2b09sJnJi7AB4xzB0cAAAJ&attcnt=1&attid0=EAAMf1dr1NMFTaXab9x9F4f4]

---------------------------------------------- This message has been scanned for viruses and dangerous content by Jambo MailScanner, and is believed to be

---------------------------------------------- This message has been scanned for viruses and dangerous content by Jambo MailScanner, and is believed to be clean. --------------------------------------------- "easy access to the world"

Dr. Siganga, With regard to the Banking Sector, i am reliably informed that the banks jointly own a clearing house for the cheques administered by Kenya Bankers Association, i stand to be corrected on this, in so far as the telecoms sector is concerned number portability still sound like rocket science since players don't want to cooperate. Going forward it might be worthwhile to examine whether the current practices in the industry will facilitate growth of the industry, it is worth noting that coverage in areas such as Archers post and some parts of North Eastern is still wanting, as Bob says lets make this debate more factual for the sake of the future generations, If it is true that price wars have affected other economies, what can we learn for such instances? there is not point burying our heads in the sand, we should aim at accessibility and affordability to all and not a select few.. On Wed, Feb 16, 2011 at 12:28 PM, Edith Adera <eadera@idrc.or.ke> wrote:

Bwana Ndemo,

While I agree with most of your analysis (not all), could you please be SPECIFIC on what your "conservative stand" is?

That would allow appropriate response.

In the meantime, we need to keep in mind what drives innovation - the insatiable desire to survive (NOT TO DIE) rather than "protection"!!

Lets support innovation rather than protection!

Edith

PS: who should be the "objective" arbitatrator given Government's stake in Safaricom? or was it all sold?

_______________ Edith Ofwona Adera Senior Program Specialist ICT4D Program and Climate Change & Water Program International Development Research Centre | Centre de recherches pour le développement international Regional Office for Eastern and Southern Africa Tel: +254202713160 | Fax/Téléc: +254202711063 | Skype: edithadera eadera@idrc.or.ke | www.idrc.ca | www.crdi.ca ________________________________________ From: bitange@jambo.co.ke [bitange@jambo.co.ke] Sent: 16 February 2011 11:58 To: Edith Adera Cc: bitange@jambo.co.ke; KICTAnet ICT Policy Discussions Subject: Re: [kictanet] Price Control in the Telecom Market in Kenya?

Edith, Prices will eventually come down even below one shilling especially when Subscriber base begins to exceed 100%. It is selfish for us now to celebrate lower tarrifs when coverage is at 40%. We need to improve coverage to at least 90%. There are pockets even in Nairobi where none of the operators has covered. The quality of service is still wanting as new technologies that put pressure on capex keep on emerging. We are not seeing aggresive rollout of 3G which all of you agree that it is critical to our last mile broadband.

For many years, Kenya's development has largely been minimalist, depressing and expensive. In the past few years, we started moving from such experiments and made serious interventions in the Telcoms and Road sectors. Serious investors are now considering Kenya as a good investment destination. Other consideration include return on investment not only for foreign investors but local investors too. Margins therefore become a critical factor.

There is no where in the world where lower margins have kept pace with technology. Any analyst will tell you that at the pace which prices are coming down in Kenya, one operator is bound to die. Unfortunately, most of the celebrating crowd will train their spears on government asking what it was doing. Whichever way the government gets the flak. That is why I make no apologies for taking a conservative stand.

Regards

Ndemo.

...

Listers,

The news I heard today made me wanna shadder!

A player with market power asking for price controls in the telecom market? Are we progressing or retrogressing?

Telecom Economics dictates otherwise and this must NOT happen in a free and competitive market! Our recent discussions on broadband access just goes to confirm that we are not there yet. We have not yet reached the most remote and isolated corners of this country....control MUST not be an option!

The Kenyan consumer continues to be constrained by availability, accessibility and affordability to fully realize the socio-economic benefits of telecoms.

As a voice for the common consumer.....among a million other voices......price control is NOT an option!

Edith

________________ Edith Ofwona Adera Senior Program Specialist ICT4D Program and Climate Change & Water Program International Development Research Centre | Centre de recherches pour le développement international Regional Office for Eastern and Southern Africa Tel: +254202713160 | Fax/Téléc: +254202711063 | Skype: edithadera eadera@idrc.or.ke<mailto:eadera@idrc.or.ke> | www.idrc.ca<http://www.idrc.ca/> | www.crdi.ca<http://www.crdi.ca/> [ https://email.idrc.or.ke/owa/attachment.ashx?id=RgAAAAANayfd3%2b2VQYZo%2flcEcy23BwBGVjMm%2bu2wT5L%2b09sJnJi7AAACCuteAABGVjMm%2bu2wT5L%2b09sJnJi7AB4xzB0cAAAJ&attcnt=1&attid0=EAAMf1dr1NMFTaXab9x9F4f4 ]

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-- Barrack O. Otieno Afriregister Ltd (Kenya) www.afrire <http://www.afriregister.com>gister.bi, www.afriregister.com<http://www.afriergister.com> <http://www.afriregister.com>ICANN accredited registrar +254721325277 +254-20-2498789 Skype: barrack.otieno

We have to think of the internecine effects of unsustainable low prices across the market that affect : 1- the airtime seller (who used to make 5% on every shilling sold but now seems to make 5% on every 50cts) - many people rely on airtimes sales to either make a living or augment their revenues. 2 - The investors in operators (whether publicly listed, privately owned, etc) and the overall effect on our investment climate when recent entrants who had a business case and certain near and mid term ROI expectations, now find themselves back at the drawing board. 3 - The people employed directly and indirectly. 4 - The government who need taxes from operators to invest in infrastructure (roads, comms, elec), 5 - The people who will remain technologically marginalised because operators are hard pressed to expand infrastructure, 6 - The existing users who are becoming more sophisticated and demanding - will suffer quality of service/congestion/etc because operators cannot really invest in more bandwidth/network upgrades/network expansion, . 7 - Submarine cable operators (and investors who include various operators) - seeing how margins are really thin, operators cannot take up more capacity than they presently need - in some cases, operators do not really disclose the capacity the end user gets (contention ratios) and some dishonesty starts to creep in as operators find ways to make money I know there have been arguments that the two shillings I save on each minute will be spent elsewhere - I agree. And overall it means the revenue I will divert to EABL, Total, Uchumi, Nakumatt, BAT, Mama Mboga, etc etc will still help other parts of the economy but in the near to mid term, stifle one part that stimulates all the other parts. My two pesetas On , james ratemo <jratemo@gmail.com> wrote:

It will be interesting to hear what CCK has to say about this.

As for me I think there could be some bullying going on in the industry. But again we should guard against price predation where some operators could bring the price so low, kick out or discourage potential 'other' competitors that would lead to a near monopolistic regime.

Yeah as Ndemo argues, we need the operators to rollout 3G extensively. As much as we need low prices we also need quality services. A balance must be struck to ensure satisfaction for customers and sustainability for investors.

Keep the debate rolling.

On Wed, Feb 16, 2011 at 11:58 AM, bitange@jambo.co.ke> wrote:

Edith,

Prices will eventually come down even below one shilling especially when

Subscriber base begins to exceed 100%. It is selfish for us now to

celebrate lower tarrifs when coverage is at 40%. We need to improve

coverage to at least 90%. There are pockets even in Nairobi where none of

the operators has covered. The quality of service is still wanting as new

technologies that put pressure on capex keep on emerging. We are not

seeing aggresive rollout of 3G which all of you agree that it is critical

to our last mile broadband.

For many years, Kenya's development has largely been minimalist,

depressing and expensive. In the past few years, we started moving from

such experiments and made serious interventions in the Telcoms and Road

sectors. Serious investors are now considering Kenya as a good investment

destination. Other consideration include return on investment not only

for foreign investors but local investors too. Margins therefore become a

critical factor.

There is no where in the world where lower margins have kept pace with

technology. Any analyst will tell you that at the pace which prices are

coming down in Kenya, one operator is bound to die. Unfortunately, most

of the celebrating crowd will train their spears on government asking what

it was doing. Whichever way the government gets the flak. That is why I

make no apologies for taking a conservative stand.

Regards

Ndemo.

...

Listers,

...

...

The news I heard today made me wanna shadder!

...

...

A player with market power asking for price controls in the telecom

...

market? Are we progressing or retrogressing?

...

...

Telecom Economics dictates otherwise and this must NOT happen in a free

...

and competitive market! Our recent discussions on broadband access just

...

goes to confirm that we are not there yet. We have not yet reached the

...

most remote and isolated corners of this country....control MUST not be an

...

option!

...

...

The Kenyan consumer continues to be constrained by availability,

...

accessibility and affordability to fully realize the socio-economic

...

benefits of telecoms.

...

...

As a voice for the common consumer.....among a million other

...

voices......price control is NOT an option!

...

...

Edith

...

...

________________

...

Edith Ofwona Adera

...

Senior Program Specialist

...

ICT4D Program and Climate Change & Water Program

...

International Development Research Centre | Centre de recherches pour le

...

développement international

...

Regional Office for Eastern and Southern Africa

...

Tel: +254202713160 | Fax/Téléc: +254202711063 | Skype: edithadera

...

eadera@idrc.or.keeadera@idrc.or.ke> |

...

www.idrc.cahttp://www.idrc.ca/> | www.crdi.cahttp://www.crdi.ca/>

...

[https://email.idrc.or.ke/owa/attachment.ashx?id=RgAAAAANayfd3%2b2VQYZo%2flcEcy23BwBGVjMm%2bu2wT5L%2b09sJnJi7AAACCuteAABGVjMm%2bu2wT5L%2b09sJnJi7AB4xzB0cAAAJ&attcnt=1&attid0=EAAMf1dr1NMFTaXab9x9F4f4]

...

...

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...

This message has been scanned for viruses and

...

dangerous content by Jambo MailScanner, and is

...

believed to be

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-- James Ratemo ICT reporter, The Standard Newspaper, PO Box 49990-00100, Nairobi Cell Phone: 0724960649 OR 0731960649 Other Emaili-jratemo@standardmedia.co.ke or jratemo@gmail.com

Website:www.ictcradle.com. Twitter accounts: kenyacurrent and jratemo Skype account:ratemoj

Who is rich? He that is content. Who is that? No one.

Kenya has chosen the "technology neutral" path, difficult to dictate to operators, but what other regulatory measures can be put in place to ensure that happens? Edith ________________ Edith Ofwona Adera Senior Program Specialist ICT4D Program and Climate Change & Water Program International Development Research Centre | Centre de recherches pour le développement international Regional Office for Eastern and Southern Africa Tel: +254202713160 | Fax/Téléc: +254202711063 | Skype: edithadera eadera@idrc.or.ke<mailto:eadera@idrc.or.ke> | www.idrc.ca<http://www.idrc.ca/> | www.crdi.ca<http://www.crdi.ca/> ________________________________ From: kictanet-bounces+eadera=idrc.or.ke@lists.kictanet.or.ke [kictanet-bounces+eadera=idrc.or.ke@lists.kictanet.or.ke] On Behalf Of james ratemo [jratemo@gmail.com] Sent: 16 February 2011 12:41 To: Edith Adera Cc: KICTAnet ICT Policy Discussions Subject: Re: [kictanet] Price Control in the Telecom Market in Kenya? It will be interesting to hear what CCK has to say about this. As for me I think there could be some bullying going on in the industry. But again we should guard against price predation where some operators could bring the price so low, kick out or discourage potential 'other' competitors that would lead to a near monopolistic regime. Yeah as Ndemo argues, we need the operators to rollout 3G extensively. As much as we need low prices we also need quality services. A balance must be struck to ensure satisfaction for customers and sustainability for investors. Keep the debate rolling. On Wed, Feb 16, 2011 at 11:58 AM, <bitange@jambo.co.ke<mailto:bitange@jambo.co.ke>> wrote: Edith, Prices will eventually come down even below one shilling especially when Subscriber base begins to exceed 100%. It is selfish for us now to celebrate lower tarrifs when coverage is at 40%. We need to improve coverage to at least 90%. There are pockets even in Nairobi where none of the operators has covered. The quality of service is still wanting as new technologies that put pressure on capex keep on emerging. We are not seeing aggresive rollout of 3G which all of you agree that it is critical to our last mile broadband. For many years, Kenya's development has largely been minimalist, depressing and expensive. In the past few years, we started moving from such experiments and made serious interventions in the Telcoms and Road sectors. Serious investors are now considering Kenya as a good investment destination. Other consideration include return on investment not only for foreign investors but local investors too. Margins therefore become a critical factor. There is no where in the world where lower margins have kept pace with technology. Any analyst will tell you that at the pace which prices are coming down in Kenya, one operator is bound to die. Unfortunately, most of the celebrating crowd will train their spears on government asking what it was doing. Whichever way the government gets the flak. That is why I make no apologies for taking a conservative stand. Regards Ndemo.

Listers,

The news I heard today made me wanna shadder!

A player with market power asking for price controls in the telecom market? Are we progressing or retrogressing?

Telecom Economics dictates otherwise and this must NOT happen in a free and competitive market! Our recent discussions on broadband access just goes to confirm that we are not there yet. We have not yet reached the most remote and isolated corners of this country....control MUST not be an option!

The Kenyan consumer continues to be constrained by availability, accessibility and affordability to fully realize the socio-economic benefits of telecoms.

As a voice for the common consumer.....among a million other voices......price control is NOT an option!

Edith

________________ Edith Ofwona Adera Senior Program Specialist ICT4D Program and Climate Change & Water Program International Development Research Centre | Centre de recherches pour le développement international Regional Office for Eastern and Southern Africa Tel: +254202713160 | Fax/Téléc: +254202711063 | Skype: edithadera eadera@idrc.or.ke<mailto:eadera@idrc.or.ke><mailto:eadera@idrc.or.ke<mailto:eadera@idrc.or.ke>> | www.idrc.ca<http://www.idrc.ca><http://www.idrc.ca/> | www.crdi.ca<http://www.crdi.ca><http://www.crdi.ca/> [https://email.idrc.or.ke/owa/attachment.ashx?id=RgAAAAANayfd3%2b2VQYZo%2flcEcy23BwBGVjMm%2bu2wT5L%2b09sJnJi7AAACCuteAABGVjMm%2bu2wT5L%2b09sJnJi7AB4xzB0cAAAJ&attcnt=1&attid0=EAAMf1dr1NMFTaXab9x9F4f4]

---------------------------------------------- This message has been scanned for viruses and dangerous content by Jambo MailScanner, and is believed to be

---------------------------------------------- This message has been scanned for viruses and dangerous content by Jambo MailScanner, and is believed to be clean. --------------------------------------------- "easy access to the world" _______________________________________________ kictanet mailing list kictanet@lists.kictanet.or.ke<mailto:kictanet@lists.kictanet.or.ke> http://lists.kictanet.or.ke/mailman/listinfo/kictanet This message was sent to: jratemo@gmail.com<mailto:jratemo@gmail.com> Unsubscribe or change your options at http://lists.kictanet.or.ke/mailman/options/kictanet/jratemo%40gmail.com -- James Ratemo ICT reporter, The Standard Newspaper, P.O Box 49990-00100, Nairobi Cell Phone: 0724960649 OR 0731960649 Other Emaili-jratemo@standardmedia.co.ke<mailto:Emaili-jratemo@standardmedia.co.ke> or jratemo@gmail.com<mailto:jratemo@gmail.com> Website:www.ictcradle.com<http://www.ictcradle.com>. Twitter accounts: kenyacurrent and jratemo Skype account:ratemoj Who is rich? He that is content. Who is that? No one.

Thank you Michael for putting my point more clearly. Let me add just one point.Without significant power market power, I do not see how any operator can engage in predatory pricing. It would therefore be useful for any lister with useful information in this area to share it . John Kariuki. ________________________________ From: Musya Michael <michael.musya@gmail.com> To: ngethe.kariuki2007@yahoo.co.uk Cc: KICTAnet ICT Policy Discussions <kictanet@lists.kictanet.or.ke> Sent: Thu, 17 February, 2011 8:12:03 Subject: Re: [kictanet] Price Control in the Telecom Market in Kenya? Furthering the quoted wisdom from the Holy Bible-Proverbs 18,17-18 by one John Kariuki,do we have Airtel,YU or Orange representatives in this list? Hearing from them can kind of steer this debate.

Why don't you analyse this from an ethical perspective:- 1) Is the competition currently in place beneficial to the common mwanainchi ? I believe the answer is yes. Price wars help the majority as they can get more for less. 2) Is putting a price floor useful to the common public ? Well you decide, my view is that this will deny the public the right to cheaper quality services. Isn't it human nature to purchase cheaper yet quality products. You also deny the public the right to innovation that fierce competition brings. 3) Can taxes be controlled/maintained due to price control floors? If i'm not mistaken there is no relationship. My take is that with lower prices you will speak for longer hours and thus still run up a bill that will assist in adding to the tax kitty of KRA and the people at large. The people defining these floors must consider that it will be hampering business development and the move would be ethically questionable as the winners of such a move would be the minority and not the majority . A word of warning: Putting a price floor on one product will open avenues for other moguls to apply for floors. Petrol, food, housing, clothing, electricity, water .... I hope you get the picture. Thanks Athar

Dear Badru Ethics in this case would be defined as how the have nots get access to basic communication facilities to earn their daily bread. My perspective is that the Internet is the best example of how amazing revelution takes place when price controls are forgotten. Now several industries have benefited through uncontrolled competition provided to the development of the Internet. Secondly the last mile solution for access to the global Internet window for most people is through cell companies. Increase this cost and it will impair the recent development the country is experiencing in the ICT front. I believe policy makers should think of the wider and long term benefit rather then current myopic schemes for the benefit of a few. On Thursday, February 17, 2011, Badru Ntege <ntegeb@one2net.co.ug> wrote:

Athar

In this aspect ethical perspective to ,me would be the wrong terminology.  Ethics and fierce competition are not good bed fellows.

Ethical

BN

On 17 Feb 2011, at 16:52, Athar Ahmad Bhatti <atharab@gmail.com> wrote:

...

Why don't you analyse this from an ethical perspective:-

1) Is the competition currently in place beneficial to the common mwanainchi ? I believe the  answer is yes. Price wars help the majority as they can get more for less.

The answer will be yes if you look at the short time. I.e today however what are the long time repercussions for the industry in the long run.

...

2) Is putting a price floor useful to the common public ? Well you decide, my view is that this will deny the public the right to cheaper quality services. Isn't it human nature to purchase cheaper yet quality products. You also deny the public the right to innovation that fierce competition brings.

In some sectors cheaper and quality will work but in the telco sector cheaper and quality are not easy to balance and thus the increase in dropped calls and congested lines.  The floor needs to be marched with deliverable measures of quality.  If a telco can guarantee a level of service then they can lower the price.  If they fail to meet that level of service then they should operate at the stipulated floor.

...

3) Can taxes be controlled/maintained due to price control floors? If i'm not mistaken there is no relationship. My take is that with lower prices you will speak for longer hours and thus still run up a bill that will assist in adding to the tax kitty of KRA and the people at large.

The people defining these floors must consider  that it will be hampering business development and the move would be ethically questionable as the winners of such a move would be the minority and not the majority .

A word of warning: Putting a price floor on one product will open avenues for other moguls to  apply for floors. Petrol, food, housing, clothing, electricity, water ....

But not putting a price floor does not prevent the same moguls from doing the same.

...

I hope you get the picture.

Thanks

Athar

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Dear Barrack Considering the crucial role that mobile communication plays in the lives of the citizens of Kenya,the Government will do whatever it takes to protect the interest of its people. If not then development becomes a myth that only the few elite will enjoy it. Just look around and see how mobile communication has improved the livelihood of for instance fishermen who can communicate and sell their catch even before they reach the shore.

From a different perspective just put this to a vote. I do believe that most of us will go for comm services that are reasonably low in cost. The few elite can then go for crystal clear, 'platinum coated' services.

I mean why have bread when you can have cake. But do not deny the rest bread however hard it may be... Athar

On Sat, Feb 19, 2011 at 1:53 AM, Barrack Otieno <otieno.barrack@gmail.com> wrote:

Precisely Athar, going forwad my submissions are emphasising on the fact that we shouldnt necessarily focus on growth of the industry per se but that of the entire economy, i would subsicribe to this argument if we had 100% coverage, considering the fact that we still have  some parts of the country that need to be covered how will this be attained?

a Universal Service Fund or requirement would be a useful first step. This would entail significant investment. Lowering the tax burden on telcos while implementing Universal Service would be necessary. This means less for KRA, but that money would go to ICCK for implementation. are the Mobile Telcos

getting sufficient return on their investment or do they have to rely on revenues from other Countries to expand coverage?

Depends on who is defining "sufficient" I think ;-) -- Cheers, McTim "A name indicates what we seek. An address indicates where it is. A route indicates how we get there."  Jon Postel