Airtel Kenya is calling for the regulation of the telecommunications sector arguing this will increase competition and investment according to its presentation to the Parliamentary Committee on Communication, Information, and Innovation.
The Committee is looking into the dominance of Safaricom which holds a 67 per cent market share while it also reviews the recommendations the Communications Authority of Kenya (CA) has made to address this problem.
The authority has however asked the Committee not to punish the largest telco in the country because that will negatively impact on the economy. CA also said there is no need for regulators to act since it does not have any evidence of Safaricom abusing its dominance.
Some of the recommendations CA made for regulating the sector require Safaricom to share its transmission sites and mobile money agent networks with its competitors Airtel and Telkom Kenya.
Airtel’s View
According to Airtel, the regulation of the telecom sector will ensure that the market does not fail and it will create a level playing field for competitors.
“More players create demand for scarce resources such as spectrum, numbering and right of way hence regulation is pivotal in ensuring that these resources are equitably allocated and efficiently utilised,” Airtel’s presentation reads.
“Given that most players tend to concentrate and invest in commercially viable areas when rolling out their networks and services, regulation is key in ensuring fulfilment of certain societal and consumer objectives such as universal service access and in some instances, quality of service.”
The telco company, that has operations in 16 countries in Africa and Asia, also believes that regulation will eliminate the negative effect of market dominance and anti-competitive behaviour. Furthermore, it will ensure that customers have “right of choice, accessibility, affordability and quality of service.”
In its presentation, the telco observes that the market shares for smaller telcos have not attained a sustainable threshold where Airtel has 19.7 per cent stake in the Kenyan market while Telkom Kenya has 8.6 per cent. Additionally, Airtel notes that although the mobile money sector is growing, the market is dominated by one operator thereby denying consumers the power to choose.
The Proposals
In its presentation, Airtel has proposed the implementation of zero-rated mobile termination rates (MTR) to address the gaps that contribute to anti-competitive behaviour. According to the telco, the MTR regulations executed from 2010 to 2014 did not solve the existing market challenges.
Airtel is also recommending for mobile money agents to use one float to enable customers to deposit and withdraw from the same agent, the prohibition of individually tailored loyalty schemes, prohibition of on-net and off-net discounts, and replication of tariffs.
“We feel that a declaration of dominance will facilitate full implementation of the much-needed remedies by the Communication Authority as empowered by the law,” Airtel says.
