Government has no plan splitting businesses in telecommunication industry

NAIROBI, KENYA: The government will not separate businesses of telecommunication companies due to dominance.

On Tuesday, Cabinet Secretary ICT Joe Mucheru dispelled rumours that the government through the Communications Authority of Kenya was planning to split the business of players who are alleged or perceived to be dominant.

“It is not the Government’s intention to punish success but enhance competition so as to foster growth of the telecommunications subsector and indeed the wider ICT sector. I wish to note here that CA is mandated by law to develop ex-ante competition safeguards to prevent any potential abuse of dominance,” said Mucheru.

Speaking at a workshop to release competition study, the CS said regulation will be stepped up against the abuse of dominance.

The study captured recent developments in the data market, Mobile Virtual Networks operators and Mobile Money transfer services.

According to the study conducted by Analysys Mason, each mobile operator retains a monopoly on call and SMS termination to its mobile network, Safaricom remains dominant in towers market.

Also the study says Safaricom is dominant in the retail markets for mobile communications and mobile money. The findings are based on market share of subscribers, volume and value confirmed by analysis of qualitative factors

The study proposes tariff control in relevant geography and access through regulated site sharing limited to seven most rural counties with review after five years.

Communications Authority in the past had to postpone release of the study on a number of occasions. It said the delay was prompted by the sensitive nature of the implications of the report, “it was important for the Authority to be alive to the prevailing circumstances in its external environment.”