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Why Jamii Telecom’s Faiba 4G Unlikely To End Safaricom’s Dominance But A Game Changer For Kenya

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Joshua Chepkwony, Jamii Telkom M.D. during the Faiba 4G launch in Nairobi.

Safaricom remains the telecommunication giant in Kenya with a market share of 71.2 percent in Kenya according to 2016 second quarter statistics report by the Communication Authority of Kenya (CA) this translates to about 28M active subscribers. This leaves other players like Airtel, Telkom Kenya, and Equitel with mere 28.8 percent share scramble.

Jamii Telecoms Ltd is the latest entry into the Mobile Operator market making it the 5th entrant. With a 4G market launch, Faiba has caused serious ripples with many analysts saying it could be the game changer to Safaricom’s dominance that has been in play for more than a decade. However, it is easier said than done, we’ve seen several companies come and go citing unfair market environment attributed to the Saf’s dominance.

Faiba 4G is however not a usual launch, in a country with estimated 86% internet penetration with about 41M Kenyans accessing the internet and majority through their smartphones, Jamii Telecoms saw a perfect opportunity. Famed for the Faiba broadband home and businesses high-speed internet connectivity, they already have a ground with over 120K subscribers to kick them off.

During the launch of Faiba 4G

The Communication Authority of Kenya awarded Jamii the prestigious 4G spectrum amidst complaints, especially from Safaricom that it was unprocedural and that the company didn’t pay the required Sh2.5B for the 4G license. So far only Safaricom and Telkom Kenya have acquired the 800MHz spectrum, Airtel still at 3.75G. Despite the complaints of favoritism, Faiba 4G is officially live with mind-boggling data price tags.

A look at JTL’s pricing signals competitive times ahead: 1GB data bundles will cost Sh50 (valid for one day), 70GB at Sh3,000 (valid for a month) and 210 GB at Sh6,000 for a month as well.

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Safaricom on the other hand offers 150MB for Sh50 (valid for a day), 1GB for Sh500 (valid for a month) and 12GB at Sh3,000 (valid for a month).

Airtel’s 1GB 24-hour data bundle costs subscribers Sh99, 6GB costs Sh1,000 (valid for a month) and 24GB goes for Sh3,000 (valid for a month).

Safaricom which offers highest internet speed compared to its competitors yet have highest data prices in the market is viewed as the main target as Faiba seeks to take a huge chunk of the share. Faiba 4G operates on band 28, 700MHz frequency spectrum, this is both great news and bad. First, it’s great since it will give consumers miraculous internet speeds, from tests, we’ve learned the Faiba 4G speeds goes up to 72Mbps, it also has higher penetration capabilities like into buildings as compared to the 800MHz spectrum now used by Safaricom and Telkom.

Secondly, Faiba 4G is limiting in so many ways; device selectivity, only those with 4G enabled phones with VoLTE features will be able to access their internet or their own Faiba mobile. Most Kenyans own budget smartphones that aren’t necessarily 4G VoLTE enabled thereby limiting the number of people able to use their services.

VoLTE stands for voice over LTE and it’s more or less exactly what it says on the tin. It’s voice calls over a 4G LTE network, rather than the 2G or 3G connections which are usually used. The big advantage of VoLTE is that call quality is superior to 3G or 2G connections as far more data can be transferred over 4G than 2G or 3G.

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Faiba 4G promises lifetime on-net calls as long as you have an active data bundle, while this sounds appetizing, it is also limiting that such calls can only happen if both have VoLTE enabled phones and within 4G area, when network signal weakens, the call quality is reduced or disconnects.

Faiba 4G’s mi-fi

So far, there’s no provider that beats Faiba 4G’s data bundles but the biggest headache that will stall their immediate boom is the device selectivity and also network reachability. Nairobi, Nakuru, Kisumu, Eldoret, Mombasa, and Thika are covered by the Faiba 4G with 300 bases and a plan to extend the bases to 1000 in the next 3 years.

Disrupting Safaricom’s dominance is not a walk in the sand and needs more than a flashy launch with heavenly offers. Reliability, reachability, innovations are some of Safaricom’s confidence zones that have seen them stand firm in the market. Mpesa remains one of re greatest innovations by Safaricom that has made it East Africa’s giant. Kenya, for instance, is synonymous with mobile transactions, the economy is literally running on Mpesa with billions moved across the platform annually.

Mpesa actually could as well be Safaricom’s biggest asset that keeps it afloat. We’ve seen Airtel money even with zero rate transactions, unable to beat of Mpesa, not for anything but reliability, agents are spread all over the country and it’s not a hustle to access your money compared to other providers. Therefore, if Faiba 4G is to hack this, then they must not play the same cards by competitors that have failed but come up with new innovations and strategies to level Mpesa dominance. Faiba Money is set for launch as well. Accessibility of Safaricom network even in the most of remote areas also makes it stand out and a major preference, if Jamii can invest heavily to match up the reach then they’re in the right lane to beat it off.

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According to the management, all is not lost for Faiba 4G as they’re likely to change bands from 700MHz depending on the availability of frequencies, this will obviously increase their reach and capture more customers angry for affordable data services. We’re also told they have solid strategies that will spread over the next coming years to totally disrupt and maul a good share of the market. As it stands, it’s a wait and sees situation.

Coming months, Kenyans are likely to witness a brutalizing corporate war as Faiba, Safaricom, Telkom fight for customers loyalty and the data market share. As the giants engage in the brawl, consumers can sit back and expect affordable, quality data services, a competitive market is often a blessing to the consumers. Safaricom is unlikely to let go easily what they have and so is Telkom, Airtel and Equitel both who’re struggling to rise. Faiba 4G as the new entrant has to go an extra mile to make an impact in the market but until then the market is open but literally a one man’s show.


Kenya Insights allows guest blogging, if you want to be published on Kenya’s most authoritative and accurate blog, have an expose, news, story angles, human interest stories, drop us an email on tips.kenyainsights@gmail.com or via Telegram

Kenya West is a trained investigative independent journalist and a socio-political commentator on matters Kenya and Africa. Send me tips to [in.kenyawest@gmail.com]

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Citron Report Reveals Why NYSE Listed Jumia Is A Fraud

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In 18 years of publishing, Citron has never seen such an obvious fraud as Jumia.  As the media in the US is naively anointing Jumia the “Amazon of Africa”, the media in its home country of Nigeria has a plethora of articles discussing the widespread fraud in this Nigerian company.  Not even that elusive Nigerian prince can cover this one up.

Jumia is the worst abuse of the IPO system since the Chinese RTO fraud boom almost a decade ago.  Worse than being “the most expensive” US listed ecommerce company, Jumia reported financials show us a stagnant business that has burned through $1 billion and has moved the suckers game to the US Markets.

In this report, Citron will expose the SMOKING GUN and show why the equity is WORTHLESS.  We believe investors cannot rely on reported numbers and a restatement of financials is on the horizon.  The SEC must protect US Investors.

Full report here.


Kenya Insights allows guest blogging, if you want to be published on Kenya’s most authoritative and accurate blog, have an expose, news, story angles, human interest stories, drop us an email on tips.kenyainsights@gmail.com or via Telegram
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Kenya Airways No Longer Profitable

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Kenya Airways Plane in The Sky Photo|KQ

The former Pride of Africa, Kenya Airways, announced its annual financial performance this week.

KQs Chairman, Michael Joseph said that 2018 was a very challenging year for the loss making airline.

Kenya airways posted a pretax loss of 7.59 billion Kenyan shillings an equivalent of $74.93 million.

In the last annual financial report, 2017, they posted the loss of Ksh 9.44 billion.

The battling to remain relevant and regain profits Airline’s chief executive Sebastian blames the loss to high fuel costs.

Sebastian has also said that KQ has super expensive personnel and their aircraft dealers are expensive.

The CEO and the Chief Executive said they’re looking at other avenues to minimise the loses.

“We started mitigating this risk by implementing a new hedging policy with minimal risk. Kenya Airways offers other services, technical and ground handling to domestic, regional and international customers” Sebastian emphasized.

“We have however seen growth in passenger numbers. Management team have done a great job under the circumstances and thanks to the board for massive support. KQ is not just an airline but a strategic asset for the country. We should be proud of what KQ has done for Kenya & support, we can help improve the country’s GDP and create employment opportunities despite our challenges. We need support from media, investors and government,” KQ’s Chairman Michael Joseph.

The recurring losses have raised questions about the current leadership of the airline. With some saying that the financial loses are tricks to help the airline chiefs to bargain for their full running of the JKIA operations.

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Kenya airways seems to have never bought affordable fuel. They complain every time of cost of fuel. Where do they get it?

However, the New Symbolic route is still below the much expectations.

Kenya airways has been forced to reduce was the number of its flights to New York from once per day to only five trips per week.

Reports indicate that the route has only had 15,000 customers in a Year.

“I do not consider it to be a lucrative route. There is nothing lucrative about flying to New York,” KQs CEO, Sebastian Mikosz says.

Seems the new added routes have no much impact to KQs financial boost programs. They are adding more expenses to an already loss making company.

Last year, KQ had added Mauritius, Libreville and Mogadishu to its destinations.

They further included Rome and Geneva to its routes after signing the New York deal.

Despite all this, the carrier expects to add two Boeing 787 Dreamliner planes back to its fleet later this year. The planes had been leased to Oman Air.


Kenya Insights allows guest blogging, if you want to be published on Kenya’s most authoritative and accurate blog, have an expose, news, story angles, human interest stories, drop us an email on tips.kenyainsights@gmail.com or via Telegram
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Urithi Adopts A Unique Model To Deliver Affordable Housing In Kenya

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Urithi Housing Cooperative Society Chairman Samuel Maina handing over the keys to the new owners of one of the houses during the handing over ceremony of Springs View gated community estate in Gatuanyaga Location of Thika East in Kiambu County.

Since President Uhuru Kenyatta unveiled his Big Four Agenda during his inauguration to serve his second term in office, the different sectors that anchor his legacy have been making all necessary alignments to fit into the presidential vision which can only be achieved through collaboration between public and private sector players.

One of the pillars of President Kenyatta’s legacy is affordable housing, with a target of 500,000 new housing units per year.

Opinions and commentaries have been penned but what has stood out is the many experts who have made a strong case that the projected numbers can only be achieved if stakeholders would embrace the socio-economic model of housing provision.

Legend supports this narrative yet fact is that it is not exclusively dependent on this model but that this will largely drive the realization of this pillar. So what is the socio-economic model of housing, how does it work and does any of the current players in property business operate on this model?

The model is entirely dependent on members, whose contributions are key and vital in initiating and executing any project that seeks to provide housing, be it public or private. Upon payment of a pre-determined deposit or down payment, the balance of the cost is spread out and paid over a period of between 12 and 48 months.

Samwel Maina, the Chairman of Urithi Housing Society, the only player that operates on this model, says monthly subscriptions vary from one member to the other depending on their economic ability.

“For the project timelines to be achieved, also entirely depends on the speed of members to make their contributions. However, slow remittance by some members has contributed to delays being experienced as most times the society has to move with the speed of the slowest member in payment,” he says.

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“Speed is determined by how fast you get money from members. But due to the uncertainty and unpredictable nature of contributions and cash flows we adjust accordingly.”

The pricing does not change over time “simply because the model mitigates on cost of labor, land and materials. Hence making it affordable without changing the initial price.”

Being an off plan project, there are critical steps, approvals and mandatory procedures that must be undertaken. Market sounding is the first of the many steps and acts a notice of the intention to undertake the project.

Then follows mobilization which entails recruiting members and other stakeholders, which process is followed by pursuit of statutory and other approvals by various government bodies, both national and county level.

Once the necessary approvals have been granted, the groundbreaking marks the beginning of construction work, whose completion is entirely dependent on members’ fidelity to make subscriptions.

“There are incidents where a member pays their subscriptions in full and expect that they would get their units but the principle here is that we pool together to own together.

“The explanation is very simple. While you may have paid yours in full, the model works in such a way that those who pay upfront help kick-start the project and sustain it by making the first commitment which is key to property ownership and the subsequent subscriptions take us through to the tail end,” adds Mr. Maina.

Urithi has over the past six years, completed and handed over thousands of housing units in Springviews in Thika, Plainsview in Juja, Gem1 in Witeithie and Lanet Homes (Nakuru and Juja).

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They intend to complete and hand over all housing projects currently under construction in the next 12 months. They include Utange – Mombasa, Gem2 and Rongai Homes which are set for completion in the next quarter for handing over to the members, while investors in the Osteen Terrace Gardens will be delivered by the last quarter of 2019.

“The OTG project is the first-of-its-kind to enable us achieve affordable housing for our members and we are using the socio-economic model. This particular project [OTG] is very timely and it will hugely compliment the government’s efforts in attaining the big 4 agenda – the housing component, by engaging other stakeholders like us,” adds the Urithi boss.

President Uhuru Kenyatta’s Big Four Agenda focuses on expanding the manufacturing sector, Universal Health Care, Food security and Affordable housing.

Under the affordable housing pillar, the government through the National Housing Corporation and collaboration with private sector players, intends to construct 500,000 units annually by using innovative construction methods and low cost building and construction materials.

“The government will achieve its dream fast if they partner with the saccos and cooperatives. Cooperatives and Saccos have structures, a wide geographical reach and most importantly members,” avers Mr. Maina, who believes affordable housing is a major milestone towards achieving the other three pillars of President Kenyatta’s legacy plan.


Kenya Insights allows guest blogging, if you want to be published on Kenya’s most authoritative and accurate blog, have an expose, news, story angles, human interest stories, drop us an email on tips.kenyainsights@gmail.com or via Telegram
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