Good analysis Brainiac, On the sms front, may be the system is already too congested with balance enquiries, mpesa hence no need to compromise QOS to the subs. after all it is not that profitable anymore. if you give subs the opportunity to access the net, most likely the sms market will be invaded with the advent of akina facebook, mig33 etc. My question is why consider post paid client as unnecessary evil. one, their ARPU is definately higher. two, these are the only clients who dont contribute to the dealer residuals i.e everything goes to safcom and three and most importantly, they are 'Loyal' and less likely to vuka than a prepaid guy On Wed, Aug 25, 2010 at 1:26 AM, [ Brainiac ] <arebacollins@gmail.com>wrote:

After a long day analyzing and re analyzing decisions made by safaricom, and after looking at the provisional product presented to "cool off" the market, I am of the opinion that in so doing safaricom may have unwittingly exposed what clients give them most revenue. -> those that spend Ksh 100 and above. hear me out.

1: They have changed nothing on the sms front, meaning they know once youre hooked on the correct calling rates, it will not matter how much you are charged. (and the converse is true--> no tarrif is likely to perform well if the incentive is only cheap (or even free) text messages).

2. The cost of supporting the clients on the 5bob to 20 bob airtime range must be abnormally high or not worth it in the long run. I suspect safaricom may actually be deliberatily easing the decision by these clients to move to zain and competition so that they are left only with the "right" kind of clientelle, where the average support cost per client is lower and probably ARPU higher.

3: Postpaid clients are .. an unnecessary evil, or a well kept secret that they hope to grow in the long term. I suspect this has something to do with holding up cash flow for the company.

Conclusion: Competitors might want to look at their reactionary move and strike where it hurts most, otherwise they stand to remain with clients at the absolute lower end of the market where volumes are high but value is low.

Me thoughts.

-- Posted on 100% recycled electrons

_______________________________________________ Skunkworks mailing list Skunkworks@lists.my.co.ke http://lists.my.co.ke/cgi-bin/mailman/listinfo/skunkworks ------------ Skunkworks Server donations spreadsheet

http://spreadsheets.google.com/ccc?key=0AopdHkqSqKL-dHlQVTMxU1VBdU1BSWJxdy1f... ------------ Skunkworks Rules http://my.co.ke/phpbb/viewtopic.php?f=24&t=94 ------------ Other services @ http://my.co.ke