Safaricom has filed a case with the Communications and Multimedia appeals tribunal, opposing the recent move by the Communications Authority of Kenya (CA) to lower mobile calling rates. The telco argues that CA ignored its procedures and erred by using benchmarking methodology rather than the long-run incremental costing (LRIC) that has been used in previous reviews.
Last week, CA cut the rates commonly known as Mobile Termination Rates (MTRs) local mobile phone operators charge each other for interconnecting customers by Ksh. 0.87 or 87.7%. The Authority claimed that the review aims to match shifts in technology that have made mobile telephony more efficient. The regulator cut the rates from Ksh. 0.99 to Ksh. 0.12.
Safaricom has called upon the tribunal to render the matter urgent, considering that CA wants the new rates to take effect on January 1st. The company has further called on the tribunal to declare issue an injunction restraining CA from implementing the cuts until the appeal is heard and determined. It says CA ignored public participation, adding that it was not given an opportunity to be heard and make representations before the final decision was arrived at.
On the flipside, Telkom Kenya welcomed the move saying it is timely and a progressive step towards making voice services more affordable and accessible to Kenyans. In a statement shared last week, Telkom Kenya said big and dominant players or incumbents in mobile telephony markets have had a pricing advantage due to the imbalance of connecting traffic between themselves and other network operators. Higher MTRs and FTRs it said have the potential to negatively impact the consumer if these larger operators are to price discriminate between on-net and off-net calls.
Airtel Kenya, in a statement issued today also supported CA, saying the move will greatly benefit the Kenyan consumer. Airtel argues that the reduction will also increase mobile penetration in Kenya and enhance access to voice and data services to support the Government’s broadband strategy and better position Kenya as a regional ICT Hub.