Controversial, costly decisions that stalked Communication Authority’s Wangusi

Communications Authority Director General Francis Wangusi made some controversial decisions, some that may have cost the State billions of shillings.

Losing the Sh2 billion licence case at the High Court last year appears to have been the waterloo for a man who had fought many battles at the CA.

Sources also say CA did not effectively use the legal counsel that would have been provided by the office of the Attorney General to put up a solid case against Airtel, in what saw the government lose revenue at a time when the National Treasury was struggling to raise cash to fund expenditure.

Sources who describe the events at the Authority as a ‘witch-hunt’ say the government felt poorly represented in court in the Airtel case in which Mr Wangusi is seen as having failed to put up a water-tight case to protect the interests of the state.

Grant waivers

The High Court last year dismissed the case in which the national Treasury was demanding license fees through the communications regulator following the 2014 exit of Essar’s yuMobile from the Kenyan market.

The deal was valued at about $100 million (Sh10.3 billion) and saw Airtel acquire the 2.7-million yuMobile subscribers at a cost of $6.9 million (Sh710 million) while Safaricom took up the frequency and phone masts.

According to Airtel, CA had promised to merge its operating licence with that of yuMobile, with the deal granting Airtel a lease to operate in the country until January 2025.

A few months later, however, CA wrote to Airtel demanding that the telco pay up Sh2 billion to renew its operating spectrum licence. CA said the National Treasury had insisted the Sh2 billion payment be made since licence fees were a matter of public revenue and only Treasury could grant waivers.

The High Court sided with Airtel, arguing that the National Treasury erred in demanding the fees despite an existing agreement between the telco and CA. The court argued that the Treasury has no power to direct the CA on how to carry out its mandate. The court further said that the need to raise revenue was not justification for CA and Treasury to flout an agreement made with Airtel.

The other controversial decision was the awarding of Jamii Telecoms, a tier 2 telecommunications firm, a license to operate another mobile phone service for just Sh100,000.

The award, seen as a gift, has been protested by the other telecommunications companies operating in the country given that it was too small, compared to over Sh2.5 billion they were paying to be allowed to operate.

The other question raised on the award of the licence for the 700MHz frequency to the firm associated with businessman Joshua Chepkwony, was why the CA did not put it up for auction to allow other players to participate.

Telkom Kenya chief executive Aldo Mareuse says the apprehension of other operators is heightened by the fact that the tier 2 operators will be directly competing in the same market they operate and might not be subjected to the same terms with regard to fees, roll-out obligations or other conditions.

Sensitive data

Wangusi’s other undoing at the authority was the failed mobile number portability, which was supposed to make it easy for consumers to move from one mobile firm to the other without losing their mobile numbers.

Five years after it was launched, the service is yet to fully take off.

The other controversy that has stoked his tenure was the push to have mobile operators install a gadget on their networks that was feared could be used to snoop on Kenyans.

Mobile companies said the gadgets have the ability to tap communication, read and track down activities of the tens of millions of Kenyans who have access to mobile devices.

The main blunder by CA was to have brought in a third party to do it, in what could have handed sensitive data to a Lebanese company.

CA was only forced to suspend implementation of the system following a court order.