By Morris Aron
Vicious price wars aimed at growing market share in the voice segment of the telecommunication sector is back in earnest.Yesterday, Safaricom launched a promotion aimed at enticing its subscribers to call on net for longer to enjoy discounts.
The promotion dubbed Wakenya Tuongee, will see Safaricom subscribers pay Sh4 for the first minute of their call, Sh3 for calls between one and two minutes and Sh2 for the calls that last between two and three minutes.Calls that last for more than three minutes will be charged at Sh1.
“On a periodic basis, we always review our customer propositions with a view to enhancing the Safaricom experience for our customers,” said Bob Collymore, Safaricom’s chief executive.
Call time
“(Based on) insights that indicate that a majority of customers talk for less than two minutes, and this proposition is aimed at encouraging customers to talk more with their families, friends and business partners”
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Safaricom’s promotions comes at a time when Renaissance Capital analysis of the Communication Commission of Kenya data stated that the figures needed to be taken ‘with a pinch of salt.’
While Safaricom still retains the market lead, and gained the most in subscriber numbers in absolute terms, Essar Telecom’s Yu brand gained customers at the highest rate in the first three months of this year.
CCK data for March indicated that Safaricom had lost its market share to its rivals with yuMobile growing by 14.5 per cent in subscriber numbers—gaining 0.8 percent market share, after the company slashed its calling charges to a flat rate set up fee of Sh5 per day for the first minute of calls made within the network.
It, however, charges Sh3 per minute for off net calls.
Safaricom gained 386,777 new subscriptions — representing a quarterly growth of 2.1 per cent with Telkom Kenya and Airtel Kenya gained 209,447 and 210,370 new subscriptions–0.3 and 0.1 percent gain in market share respectively.
Safaricom’s move to spike the voice market price wars also comes amid reports that mobile phone users could soon enjoy reduced and more stable calling rates following a decision by industry stakeholders to lower the amount of money mobile companies pay each other for calls that terminate in a rival’s network.
At a recent meeting, it was agreed that the Mobile Termination Rates be reduced from the current Sh2.21 to Sh1.60 per minute.
Safaricom’s promotion follows Airtel’s launch of one of the biggest discount on top up and usage promotions on the domestic telecommunications scene where a subscriber is required to spend Sh100 on any given day receives Sh500 free talk time for on-net calls to be used by midnight of the very day.
Those who understand the pricing trends in the telecommunication industry say this is the beginning of another round of a vicious price war in the voice market segment.
The Wakenya Tuongee promotion will only apply to Pre-Paid customers making Safaricom to Safaricom calls from 6am to 6pm and runs for a month.
