- It is estimated that Safaricom may lose almost Sh1.5 billion annually when the new mobile termination rates (MTR)- charges levied by a mobile service provider on other operators for terminating their voice calls on its grid come into effect from this month
It is estimated that Safaricom may lose almost Sh1.5 billion annually when the new mobile termination rates (MTR)- charges levied by a mobile service provider on other operators for terminating their voice calls on its grid come into effect from this month. An agreement was reached earlier between the Communications Authority of Kenya and Safaricom to cut MTR rates from the current Sh0.99 per minute to Sh0.58 per minute.
As the leader in the market, with a major market share in the voice business, Safaricom has been a major beneficiary of the MTR. It registered a net gain of Sh3.8 billion from its rivals Airtel Kenya, Telkom Kenya, and Equitel in the year ended June 2021 under the current tariff.
The revised rate, to be affected for one year starting this month, will erode Safaricom’s net income from the charges 41 percent to about Sh2.2 billion. At the same time, the other telcos will save on what they have been paying to the Nairobi Securities Exchange-listed firm.
Safaricom would have lost even more if CA’s earlier plan to cut MTR to Sh0.12 per minute effective was implemented. Safaricom challenged the CA’s proposal at the Communications and Multimedia Appeals Tribunal. But the parties reached a middle ground and filed consent.
Also read;
https://trendsnafrica.com/safaricoms-bid-to-block-iristel-kenya-limited-thwarted/
https://trendsnafrica.com/expensive-phone-sets-dampens-safaricoms-5g-expansion/
