Operator price wars in East Africa have blighted operators’ efforts to ensure quality of service, meet customers’ expectations and retain their loyalty. As consumers buy up multiple SIM cards to take advantage of the best deals, subscription rates have been artificially increased 19% year-on-year whilst ARPU has declined to a mere 12% to reach just US$7.13 at the end of 2010.
All of this is set to change with the impending introduction of Mobile Number Portability in East Africa. It’s well accepted that consumers elsewhere are loyal to their mobile number, not their operator, so for the first time East African consumers will benefit. It is likely the consumer will now look to network quality and value added service offerings when choosing their service provider, triggering fresh competition between the operators on quality, and away from the dirty price wars. As the artificial buffer of multiple SIM cards is knocked back, Safaricom - as the dominant incumbent so far - is expected to be the biggest loser, and competition will heat up further.
But there has been disappointing news in local press reports this week, that mobile operators in Kenya may not be ready for the adoption of the Mobile Number Portability which is scheduled to take effect from 1 April 2011. The four operators are yet to start test-runs on the switch platform dubbed, the ‘All Call Query System’ and insist that they need at least four weeks to perform the tests. The industry regulator, CCK has reiterated that the deadline for the switch-over will not be extended. For the sake of the consumer, we hope this doesn’t end in deadlock.
East African operator leaders will be meeting in Nairobi, 5-6 April to discuss implementation of new networks and services across the region at East Africa Com conference. Find out more online www.comworldseries.com/eafrica