This “Bamba” Monster Called Safaricom

If you will read this post in the morning (Kenyan time) you will be taking it in even as a meeting will be going on between CCK Director General Charles Njoroge and chief executives of all the mobile phone operators in the country. The main item on the agenda is the thorny mobile number portability (MNP) service.

There is nothing new under the sun and to really understand the issues at hand it is important to understand the monster called Safaricom created by you and me and millions of other Kenyans.
Those Kenyans who know who this man is will better understand what is going on in the Safaricon versus Airtel wars.

What would you feel if you single-handedly created the cell phone industry in Kenya? Actually that is exactly what Michael Joseph’s Safaricom did. When he took over the reigns at Safaricom the mobile phone operator had one base station and one would-be competitor (Kencell, today’s Airtel) run by a sleepy CEO who did not believe that there was any serious market for cell phones outside Muthaiga and its’ environs. In those days it cost about Kshs 250,000 to own a cell phone and subscribers were also charged for calls received. This was happening when vegetable sellers in neighbouring Tanzania were already using cell phones.

Mr Joseph with very little knowledge on Kenya and Kenyans headed straight for the Kibera slums where he started his talks to the curious poverty stricken Kiberians with phrases like “This is a cell phone.” To date Joseph has not told Kenyans the fact that his advertising agencies and so called “marketing experts on Kenya” laughed at him in his face and told him he was crazy and what he was trying to do would never work. Anyway at about the same time the Kencell MD (who was making much more sense to local marketing experts) was addressing Kenyans through press conferences on the then debate about per second versus per minute billing for calls with phrases like: “It is much cheaper to buy a bottle of wine at a restaurant rather than a glass at a time.” Most of his audience had never been to a smart restaurant in their entire lives and would never EVER hope to come anywhere near one unless they were doing the cooking or guarding the cars outside. So they would never understand what the hell he was saying in a hundred years. The ones who understood did not care less about what they were being charged for their calls. Indeed some of them were pretty upset that the price for a mobile phone was rapidly dropping from the status symbol pricing of Kshs 250,000. Did you hear the story about the man in Karen who when driving past one day angrily threw his cell phone in the bush on seeing a night watchman using one as he walked to work?

Anyway you all know how that business fairy tale ended. Today Safaricom is a multi-billion shilling company, by far the most profitable enterprise in history in East and Central Africa and well beyond. Kencell has basically been struggling and has changed hands several times.

With this kind of historical background, if you were Safaricom wouldn’t you quite rightly feel that you owned the mobile phone industry in Kenya? And that anybody else trying to take away the customers you literally created has no right to do so? Those who will appreciate what I am saying here are entrepreneurs who know how hard it is to make one single sale let alone create and grab millions of faithful customers.

And with this kind of knowledge you will appreciate where the problem is. Fellow Kenyans we have created a monster called Safaricom and now that we have discovered the joys of cheaper calls we can’t just wish them away. In fact we cannot simply shout “I divorce you” three times and expect her to go away. Or at the very least behave themselves as we welcome our new younger and more desirable wife called Airtel.

The truth is that Safaricom’s super profits have come from our blood and sweat money. The company is still making profits even as they charge much lower tariffs. That is the truth.

To understand how companies that dominate rapidly growing markets can be uncontrollable monsters later when other players want a level playing field read the story of the richest man in history. One John D. Rockefeller. Interestingly Kenyans have in recent days seen for themselves the power of oil companies against EVEN legislation and the laws of a country. Indeed oil companies have organized regime changes in very many countries and it all started with Rockefeller’s monopolistic business tactics. But that is a story for another day.

In short I do not envy Bwana Njoroge and his CCK and my bet is that the meeting this morning will resolve nothing. The truth for ordinary Kenyans is that it is very difficult to move from Safaricom while retaining your cell phone number. Read this article. That is the truth!!

Other recent posts by Chris:
Ikolomani: Why the man with two wives won

Why the next president of Kenya will be the "wrong kind of president for Kenya."

Hot tip from Kumekucha: Did you know that even as you read this there are some Kenyans based in Nairobi quietly making money from all over the world (to the tune of $5000 and more every month without fail). This is their secret. Do your own research if you don't believe me