Kenya’s Safaricom loses 1.6 percent of its telecom subscribers’ market share in Q2

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Safaricom, a Kenyan telecommunications company part-owned by South Africa’s Vodacom and Britain’s Vodafone, lost 1.6 percent of its telecom subscribers’ market share in the quarter ended June 2018. The company, which is the country’s biggest operator, notes that the loss marks the third straight quarterly drop.

Safaricom’s user base was up by 0.7 percent from the previous quarter, but its rivals including Bharti Airtel’s Kenyan unit added more subscribers, a development that led to Safaricom’s reduced market share. Airtel’s subscribers rose by 11.9 percent to secure a market share of 21.4 percent while Safaricom subscribers’ market share has reduced to 65.4 percent from 72.6 percent in June 2017.

Eric Musau, a research analyst who covers the company at Nairobi-based Standard Investment Bank, said investors were unlikely to be concerned by the market share drop, especially because Safaricom grew its user base and commands a big lead in revenue.

Industry regulator, Communications Authority of Kenya and Safaricom have clashed over a report on competition in the industry. The report among other things calls on Safaricom to implement price controls, a move that will help smaller operators.

According to Communications Authority, in 2015, Safaricom enjoyed the largest share of revenue, with more than 90 percent in key categories such as voice calls.

Safaricom, which as been dealing with a fall in its market share has had its Chief Executive Officer, Bob Collymore absent for nine months as a result of a medical treatment. Collymore however returned to Kenya in August and attended two public events after he resumed work.

Musau noted that “Safaricom is one of the companies which you are quite confident that the CEO isn’t the only person who can run the business. He was ably represented and the organisation generally is quite well-structured”.

 

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