The Competition Authority of Kenya (CAK) has defended Safaricom against claims that the telco has abused its dominance in the telecommunications sector.
The Authority’s director-general Wang’ombe Kariuki, yesterday told the Senate that compliance checks on the telco’s M-Pesa platform, voice and text services had not revealed contracts and practices that have exposed its rivals, Airtel and Telkom to unfair competition.
CAK said Airtel Money and T-Kash operated by Airtel and Telkom respectively had over the years increased their share of money transfers and mobile subscribers due to the fair playing field in the sector.
Safaricom holds more than half of market share in mobile money, voice and messaging and fixed data sectors, a position that has attracted criticism from rivals and Parliament.
“Agreements between Safaricom PLC and its agents are free of clauses limiting the agents from trading in products from Safaricom’s competitors,” Mr Wang’ombe said.
“Secondly, the market share of the top firm, Safaricom PLC, has been decreasing over time. This indicates lack of significant market power.”
Safaricom’s share of mobile subscribers dropped from 80.7 per cent in September 2010 to 63.6 per cent in September last year while rivals have slightly increased their stakes.
The telco’s M-Pesa platform holds 98 per cent of the mobile money market while Safaricom controls 64.7 per cent of the voice market compared to the combined share of 35.1 per cent of Airtel and Telkom.
A conviction of abusing a dominant market position can lead to a five-year prison term and as much as a Sh10 million fine, according to the Competition Act.
