Over the past couple of days, telecommunications firm Safaricom has attracted criticism following a letter it authored and sent to the Communications Authority if Kenya (CA).
In the letter, Safaricom was interpreted by many Kenyans as being rattled by the entry of billionaire Elon Musk’s Starlink into the Kenyan market.
The company, in the letter, called on the government to revoke the license given to Starlink for satellite internet services, and instead compel internet service providers such as Starlink to partner with local companies – such as Safaricom.
In one of the criticisms penned by Kenyans against Safaricom’s petition against Starlink, popular Kenyan hotelier Mohammed Hersi drew parallels the entry i to the market by M-Pesa and how it was fought by commercial banks and the current entry into the market by Starlink which Hersi says is being fought by Safaricom.
Here is Mr. Hersi criticism of the move by Safaricom; Do you think Mr. Hersi is right? Does Safaricom have anything to fear about the entry of Starlink into the Kenyan market?
“When Michael Joseph (MJ) became the first CEO of Safaricom and mooted the idea of M-Pesa, the top banks were furious. They lobbied and finally had a date with the then acting finance minister, the late Hon. John Michuki, alongside the then Governor of Central Bank Njuguna Ndung’u.
Banks made it clear that a communication company venturing into the world of money without being a bank is a big no-no. While banks approached CBK 17 years ago, Safaricom is today approaching CA, the regulator, trying to stop a fellow communication company.
Michuki and Ndung’u paid close attention and disregarded the banks’ appeal, allowing M-Pesa to continue operating. If banks receive the news that M-Pesa will disappear today, they will be the first to voice their objections.
Safaricom is asking CA not to license Starlink but to insist they partner with local players. Why does Starlink need a local player to set up shop apart from the unnecessary broker role, which is not required at all?
It saddens me greatly that today a firm that benefited from the free market is busy seeking favors that don’t exist in law. The Internet is a necessity and no longer a luxury. As a hotelier, we have camps and lodges that struggle with connectivity, and even what we get is hit-and-miss while the cost is insane.
In Kenya, there are numerous small towns and schools that lack connectivity. This means that learners and residents of these smaller towns often miss out on the benefits of full connectivity at decent speeds, simply due to their perceived lack of financial resources.
Safaricom has no business trying to place obstacles in Starlink’s path. Today, Safaricom finds itself in a similar situation to banks, which are attempting to block M-Pesa services. Well, what is good for the goose is good for the gander, so please allow Starlink to be.
Starlink doesn’t require you, Safaricom, or any other player to act as a go-between. This is precisely why Starlink relies on satellite technology, eliminating the need for intermediaries who would only increase the cost.
Bw Ndegwa, please wear your creative hat with your team and come up with a counter as opposed to seeking to place hurdles in the path of Starlink.
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When MJ was asked about M-Pesa, he said he is not targeting the bank’s clientele; he was simply targeting what the banks then described as the ‘unbankable’; those are the clients who could not maintain a minimum bank balance of Sh. 30,000.
Today, Starlink is also serving the unserved and undeserved in the digital world of connectivity. Well, they will also then target Safaricom clients like yours truly here; in fact I am using my home fibre to share this message.
Instead of trying to stop a river, how about building a dam for a rainy day? Reach out to Starlink to be their partners in Kenya and use your wide network across Kenya to service them. Banks did not insist that M-Pesa service go through them but by default that finally happened purely dictated by market demand and not through government control or dictates.
Please learn to grow the cake to achieve a larger pie, and avoid becoming overly comfortable with a bigger slice of a smaller cake.”
