On Sat, Sep 11, 2010 at 1:44 PM, Peter Osotsi
<peter.osotsi@gmail.com> wrote:
Luke;
Before I became a tech, I was an economist. And from an economist's perspective, what Safcom is making is very little compared to their size and size of our market. When compared to other regional telecommunication providers, Safaricom is making a tidy profit. Its such a small profit, if tech people think its a lot of money, then this country is doomed. We have to think outside of the box - kinda how is Safaricom able to make more money than other players? I want Safaricom to make USD 1 billion, not a paltry USD 300 Million. Its because they have the infrastructure, people and the market to make USD 1 Billion.
Aaah, you want Safaricom to make USD 1 billion? Means they have to charge us 3 times the previous rates or how do you propose they do this?
Looking around, Safaricom is the most accessible telecoms provider to a majority of Kenyans. That means when a Kenyan is looking for a telecommunications service provider, the nearest shop they will find is a Safaricom outlet. If a Kenyan wants to send or receive money on the mobile, its a Safaricom dealer that will be the nearest. Same for airtime top ups. Safaricom is made up of upto 50% local shareholding. You and me.
Not forgetting the renowned Mobitelea:-)
Can someone tell us who is Mobitelea? You said some companies ship their money outside, while Safaricom keeps all in Kenya, right? Is mobitelea "some Kenyans", and can they stand up?
Thats what has made Safaricom a dorminant player. Safaricom invested in all that through bonds on the stock market and private placement loans from abroad. They didn't get loans or concessions from government. Orange Telkom did. Infact GoK has reaped tremendously from Safaricom than from all other private enterprises, do your research. I have never heard other players raising money whether locally or internationally.
Put all this economics aside. How does the Safaricom rates help the small man? Not you, the economist. You are discussing ecomomics, not quite what the common man wants to know. They want cheap rates.
Then if Safaricom invests in technology and an Indian comes and wants to make a profit, and we resort to killing an investment just to appease a mpita njia, thats a silly mistake.
Now you reason like a layman. What is the mistake? Zain does NOT control the Telecommunications sector in this country. CCK does.
They need to learn from this unique market, and adopt to it. Kenya will never be India, or South Africa. Ask me how new entrants Groupe Bank of Africa or Ecobank are able to compete silently in the banking sector despite the likes of Equity, Standard Bank, Barclays and Standard Chartered. These two are unique because they are francophone, and from West Africa. And are doing quite well looking at the foothold they are having on their core markets. South African and Indian firms have to learn from West Africans.
Guys lets stop complaining when a small profit is made by a telcoms service provider, we should in fact encourage them to grow bigger by giving them concessions, tax breaks and other business incentives because their contribution to families, KRA (GoK) and CSR is good for the economy.
Osotsi, do you know how much Kenyans are taxed?? If you did, you'd not be reasoning like this. We need cheaper call rates and that is nothing new. The time has come and there is no turning back. Just let the different arms of the govt fight, but they cannot tell us CCK folks made a dumb decision reducing interconnection charges. Let Safaricom compete. Is it the share prices worrying you? We've all lost on that but that should Safaricom can make money by innovation - 3G, 4G, or even 5G;)