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Safaricom tightens its grip on mobile telephony market

  Shoppers at the Safaricom customer care centre on Kimathi Street in Nairobi after CCK announced that it would switch off fake handsets last year. FILE
Shoppers at the Safaricom customer care centre on Kimathi Street in Nairobi after CCK announced that it would switch off fake handsets last year. FILE 

Safaricom has strengthened its market dominance in Kenya mobile telephony business whose subscriber base has been hit by the switch off of the unregistered SIM cards.

Safaricom market share on voice traffic increased to 79.5 per cent in the quarter to March from 77.5 per cent in the three months to December as rival operators shed market share.

The operator recorded 5.8 billion minutes of calling period of the 7.2 billion posted by the four operators despite being the most affected by the SIM card switch off—which cut the number of mobile phone subscribers to 29.8 million from 30.7 million in December.

Safaricom lost 200,071 subscribers followed by Airtel (169,237) Orange (7970) and Essar’s yu (1,735).

The removal of unregistered SIM cards started in December 28 and was aimed at curbing the growing incidence of crime, especially kidnapping and ransom.

“The market shares by voice traffic for the operators declined during the quarter except for Safaricom Limited,” read part of the CCK quarterly report.

“The wide disparity could be as a result of Safaricom’s significantly high market share of subscribers resulting in a large percentage of calls terminating on its network.”

Safaricom recorded 93.1 per cent or 5.4 billion minutes of calls within its network compared to Airtel subscribers who made 53.2 per cent of their calls to rival networks.

This has left Airtel with a high a termination bill—the fees, which stood at Sh1.44 a minute, that mobile phone operators charge each other for interconnecting rivals’ calls.

Airtel market share stood 11.5 per cent in March compared to 10.5 per cent in December while YU also declined by one percentage point to 7.6 per cent. Telkom’s share stood at1.3 per cent from 1.4 per cent.

The dominance helped Safaricom return a net profit of Sh17.5 billion in the year ended March, reflecting a 38.8 per cent growth.

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