Industry

Safaricom, Airtel spared paying customers for network outages

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The Communication Authority of Kenya headquarters at Westlands, Nairobi on December 21, 2020. PHOTO | LUCY WANJIRU | NMG

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Summary

  • Customers were to be compensated for a maximum of three dropped calls daily for up to Sh30.
  • Expiry of the Bill is a reprieve for the companies that would have spent millions of shillings to compensate callers hit by call outages on their networks.
  • A Bill expires or lapses when it is not read for the second time and committed to the respective Parliamentary committee for scrutiny within a calendar year.

Telecoms operators have been spared from paying customers for voice service outages after expiry of a proposed law that had sought to impose a penalty of up to Sh30 per day for dropped calls.

The Kenya Information and Communication (Amendment) Bill required the telcos, including Safaricom #ticker:SCOM , Airtel Kenya and Telkom Kenya, to compensate their callers Sh10 for every dropped call.

Customers were to be compensated for a maximum of three dropped calls per day for up to Sh30.

The Bill was introduced in Parliament in 2020 to compel mobile telephony firms to improve the quality and availability of calls on their networks.

Its expiry is a reprieve for the companies that would have spent millions of shillings to compensate callers hit by call outages on their networks.

“The following Bills which were published in 2019 and whose second reading had not been concluded by end of the fifth session have now lapsed,” Justin Muturi, the Speaker of the National Assembly, ruled on Wednesday.

A Bill expires or lapses when MPs fail to debate it and it is not reviewed by a parliamentary committee one year after being tabled in the House.

It can be published afresh and returned to Parliament by an MP. But this looks remote given the tight parliamentary calendar, which ends in May ahead of the August 9 General Election.

The proposed law aimed at shielding millions of mobile phone clients from poor services related to network outages, including lack of Internet connections.

It, however, exempted telcos from paying users for call outages caused by factors beyond the control of an operator, technically known as force majeure.

“A licensee is liable to credit a customer who initiates a call that gets cut out after a connection by Kenya Shillings ten worth of airtime for each call drop within its network for a maximum of three call drops per day,” said the Bill.

Callers are currently not compensated for call outages, a legal gap that has shielded telcos grappling with network hitches in different parts of the country.

The communications regulator is permitted by law to sanction any telecommunications company that inconveniences customers through service interruptions as a result of the operator’s omission.

An operator found in breach risks a fine of up to 0.2 percent of its revenues, which could run into hundreds of millions of shillings.

The proposed law sought to include compensation to clients for mobile phone outages.

The Communications Authority of Kenya (CA) last year flagged Airtel and Telkom for poor quality of calls on their networks across 33 counties in 2020 but failed to sanction them.

The CA instead put the firms on notice, saying that a repeat of the outages would attract fines.

Airtel scored an average mark of 52 percent in the survey— the lowest of the three telcos— followed by Telkom Kenya at 73 percent. Safaricom scored an average of 92 percent in the survey conducted in 2020.

The CA had set a minimum threshold of 80 percent on quality of calls for the three telecommunications firms across 33 counties in the review period.

Kenya sought to join countries in the West where users of telecoms services are compensated in the form of a credit on their bill after network outages.

In some European countries customers are able to claim for any out-of-pocket expenses that resulted from being without phone services. This must be a genuine loss which can be proved with evidence.

In Kenya, Safaricom and Airtel have faced regulatory investigations after outages left their customers without services for hours.

In 2017, Airtel was fined Sh26.6 million by the CA for failing to meet the set standards on call quality in a period that saw rival Safaricom slapped with a hefty penalty of Sh270 million.

Telkom Kenya paid Sh14.9 million for quality breaches during the same period.

Telecommunications service outages have also been viewed as a threat to the economy, especially for critical services such as money transfers.

A 2016 Treasury report warned that a collapse of the M-Pesa service could, for instance, cause widespread disruption in the economy.

The CA has been considering imposing steeper penalties on operators that offer poor quality voice, data and messaging services.

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