Money Markets
By NEVILLE OTUKI, notuki@ke.nationmedia.com
In Summary
- Current subscribers of monthly billing service will be retained until May 2015 after which they will have the option of migrating to other tariffs.
Telecoms operator Safaricom
on Monday terminated two of its post-paid calling tariffs, but retained
current subscribers of the monthly billing service for one more year.
The telco cited losses in the Karibu post-paid
tariff which had gained popularity in the past few months owing to its
enticing bouquet for its over 140,000 retail clients.
Current individual subscribers will continue
enjoying the service until May 26 2015 after which they will have the
option of migrating to other tariffs.
“We would like to notify our customers that the
Karibu PostPay bundles (1,000 and 2,500) have been discontinued and
shall not be available to new customers with effect from Monday, 26th
May, 2014,” read a notice from Safaricom in the dailies on Sunday.
The Karibu post-paid tariff
has two price plans. For Sh1,000 per month, a subscriber gets 900
minutes talk time for on-net calls, 100 minutes for off-net calls, 100
megabytes of data and 100 on-net SMSes.
For the Sh2,500 per month package, subscribers get
2,200 minutes for Safaricom- to - Safaricom calls, 300 minutes to rival
networks, 250 megabytes of data and 250 on-net text messages.
Chief executive Bob Collymore Sunday told the Business Daily
that the company had received approval from the Communications
Authority of Kenya (CAK) last week to cancel the service as the firm
could not sustain it longer.
“The Karibu post-paid tariff was a promotional
tariff whose time has lapsed,” said Mr Collymore on phone. “It was a
loss making tariff.”
The low revenues from the tariff were attributable
to the fact that subscribers on Karibu post-paid bundles pay less than
one shilling per minute to make calls compared to Safaricom customers on
pre-paid plans who are charged Sh4 per minute for calls made during
peak hours (8am and 10pm).
Safaricom has, however, maintained other post-paid
tariffs such as New Advantage, community phone and those for corporate
clients.
Safaricom, which is the largest telecoms operator
in Kenya by market size, introduced the post-paid service in 2011 in the
midst of calling tariff wars in the industry.
Mr Collymore said that in the intervening period, the telco would come up with several new post-paid tariffs that would offer subscribers options.
Mr Collymore said that in the intervening period, the telco would come up with several new post-paid tariffs that would offer subscribers options.
“We will come up with new tariffs between now and
next May to give the existing subscribers of Karibu tariff and new
customers other options,” said Mr Collymore without mentioning whether
the charges would increase or the service bouquet would shrink.
Local mobile operators have post-paid plans where
payments are made once a month and a client gets a set mix of airtime,
data bundles and text messages based on their monthly fee.
Industry data recently released by CAK shows that
in the three months to December, Safaricom’s post-paid clients grew from
312,528 to 431,425, a 30 per cent growth.
During this three-month period, Airtel Kenya’s
post-paid clients grew 4.5 per cent to 124,355 while yuMobile’s clients
increased 18 per cent to 1,572.
Telkom Kenya saw its post-paid clients decrease by nine to 3,151.
Telkom Kenya saw its post-paid clients decrease by nine to 3,151.
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