Safaricom CEO says dominant player tag to slow its growth into global brand

Corporate News

Safaricom CEO Bob Collymore before the Senate ICT committee on July 30, 2015. PHOTO | JEFF ANGOTE 

By LYNET IGADWAH

In Summary

• Safaricom CEO Bob Collymore says curtailing Safaricom’s dominance would limit its target to grow into a global brand.

Safaricom chief executive Bob Collymore has told Parliament that the telecommunications regulator does not need to impose sanctions on it as long as it is not abusing its dominance in the market.

Mr Collymore told the Senate Committee on ICT on Thursday that curtailing Safaricom’s dominance would limit its target to grow into a global brand.

“Our target market is global. We are competing with the likes of Google who enjoy dominance in their country of origin,” the Safaricom boss told senators in defence of relentless calls by rivals to impose sanctions on the company.

In an apparent swipe at Safaricom’s main competitor Airtel, Mr Collymore said the company is owned by foreigners who “probably do not have the best interest of Kenyans at heart.”

Airtel Kenya is owned by Indian conglomerate Bharti Airtel. Early this year, Airtel wrote to ICT Secretary Fred Matiang’i requesting to have Safaricom declared a dominant player and split into three independent entities.

READ: Airtel renews calls for regulators to declare Safaricom dominant

If declared dominant, Safaricom would operate in a more restricted business environment in terms of marketing and pricing.

“We see no justification for splitting our business into three. The likes of Google, Microsoft, Panasonic and Sony are vibrant because they stand on their own two feet,” said Mr Collymore.

In March, the Communications Authority of Kenya published a set of 11 regulations, among them Fair Competition and Equality of Treatment regulations.

The regulations initially intended to come to force in mid-June would have seen any telecommunications or broadcasting firm that controls 51 percent of the market share automatically declared dominant.

The Competition Authority of Kenya opposed the move until a number of factors were considered, key among them being abuse of the dominant position.

The Senate ICT committee also queried Mr Collymore about issues that had been raised about safaricom’s market dominance including M-Pesa, percentage of drop calls and roaming charges.

Airtel Kenya CEO Adil El Youssefi has insisted that failure by the regulators to declare Safaricom dominant has made it the only profitable mobile firm in the country.