MPs brush off Airtel on dominance claim

Airtel CEO Prasanta Das Sarma when he appeared before the National Assembly Communication, Information and Innovation Committee on the inquiry into legislative and regulatory gaps affecting competition in telecommunication at County Hall,Nairobi on Thursday 26/07/18. [Photo: Boniface Okendo,Standard]

A new bid by Airtel for stronger regulations in the telecommunications sector to deter dominance by some players has hit a snag.

The petition wants the industry regulator to review sections of the Kenya Information and Communications Act and make it possible for any telecommunications firm that has more than 50 per cent market share to be declared dominant.

While making a case for regulations to counter dominance before Parliament’s ICT Committee, Airtel Kenya Chief Executive Prasanta Das Sarma said the industry had become hostile and diminishing revenues had made it difficult for Airtel to offer services.

Market control

“We are in a situation where one player has a market control of 65 per cent, bigger than all the other players combined. It is unfair for the rest who are seeing diminishing revenues and can hardly keep up operations,” said Mr Sarma.

“I think by law, any one entity with a market share of more than 50 per cent should be declared dominant. And the regulator should treat that entity differently from the rest.”

However, Committee Chairman William Kisang led the MPs in demanding that Airtel must do more to improve its competitiveness.

Mr Kisang told the Airtel team that it needed to reinvest its revenues in improving its products, especially its network and customer service, before demanding stiffer regulations on dominance.

“We are a free market, a situation where the market corrects itself naturally without too much State intervention,” he said, adding:“We cannot punish success when one player is doing better than the rest of the telcos.

“What Airtel needs to do is to invest more in things like making money transfer safer and more affordable, a clearer network and anything else that will attract the customer to them before demanding regulations”.

Sarma countered, saying Airtel’s revenues were being swallowed by operating expenses and that there was nothing much to reinvest in the business.