Category Archives: Uncategorized

Mobile ‘Market Share’ Strategy

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Essar Telkom’s Yu brand, announced on July 12, a free on-net tariff within its network, active between 6 A.M and 6 P.M daily, to run for three months.

Madhur Taneja, the C.E.O, was reported saying “the offer is aimed at building market share, adding that profits are not their priority in the short-term as they seek numbers to

New offer by Yu

grow revenues in the long term.” The C.E.O presented that “the offer is absolutely free. There are no hidden charges or subscription charges per day. We take this seriously and our competitors should know that we are in the market to stay.” The Standard reported. Recently, President Kibaki issued a directive to Communications Commission of Kenya, to suspend implementation of the Mobile Termination Rates (MTRs), which would see a further drop in interconnection charges.  “This is a big blow to Airtel Kenya, which has been pushing for a further fall in the termination rates as its business strategy, just like that of Essar Telkom’s Yu…” which both depend on a “low-cost mass market model.” allAfrica.com reported. Safaricom and Telkom Orange opposed the reduction in (MTRs) warning that “a further cut would have a negative effect on the sectors profitability, risk of job losses, curtail new capital investments, reduce government revenue and competitiveness.” allAfrica.com reported. In August 2010, CCK cut termination rates by half from Sh. 4.42 to Sh. 2.21, which experts have directly linked to the price wars that saw Safaricom’s market share drop to “69.9% from 75.9% as rival Airtel and Orange, “increased their market share to 15.2% from 13.5% and 8.5% from 4.0% respectively.” However Essar Telkom’s Yu “edged down 0.3% to 6.4%”, Dyer & Blair Investment Bank website reported. From an economic analyst perspective, “it is flawed to assume that lower mobile termination rates will automatically lead to lower overall retail prices and to higher consumer welfare.” However, “this is not to say that the level of mobile termination rates (MTR) does not matter or that high MTRs are necessarily good, as there is a level of termination rates, usually cost based, which maximizes total (consumer plus producer) welfare.” Assessing the impact of lowering mobile termination rates, (July 2008).

That said, Essar Telkom’s Yu latest maneuver (having in mind mobile number portability) to woo over new and existing subscribers from rival networks by offering a free on-net tariff within its network all day, could be viewed as the game-changer in the mobile telephony industry. But is it?

What’s Your Say?

The Conversation begins…

References:

‘yu’ offers free daytime calls for three months Business Daily July 12, 2011

Yu free calls cause ripples in market The Standard (As of) July 17, 2011

Lower Mobile Phone Calling Rates Put On Ice After Intense Lobbying allAfrica.com June 14, 2011

Safaricom’s Stand On Interlink Fee Triggers New Battle With Regulator allAfrica.com April 27, 2011

Safaricom loses market share to smaller players Dyer & Blair Investment Bank June 10, 2011

Assessing the impact of lowering mobile termination rates Frontier Economics July, 2008

 

 

 

Drought Situation in East Africa

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In August 2010, World Meteorological Organization (WMO) and the National Oceanic and Atmospheric Administration Climate Prediction Center (NOAA/CPC), both, officially declared a La Nina event.

Sea Surface Temperature (SST) measurements in 2010 indicated rapid cooling, thus yielding “a moderate La Nina event…” projected to last for 9 to 12 months, Famine Early Warning Systems Network (FEWSNET) reported. “La Nina events are generally associated with drier than normal conditions in the eastern sector of East Africa, and wetter than normal conditions in the western and northern sector of the region.” FEWSNET reported. According to National Aeronautics and Space Administration (NASA), the La Nina phenomenon results in “drought over most parts of East Africa and floods and lush vegetation in Australia and other parts of southeast Asia.” guardian.co.uk reported. Jan de Leeuw, the Operating Project Leader (OPL) in the Vulnerability and sustainability in pastoral and agro-pastoral systems within ILRI’s People, Livestock and Environment theme (PLE) was put on record saying, “this La Nina event is one of the strongest since the 1970s.” Meanwhile, Daily Nation reported that “Kenya has been listed among countries facing the world’s worst food security crisis in the eastern horn of Africa.” Further afield, Associated Press (AP) reported that, “UN officials sounded the alarm Tuesday about a deepening humanitarian crisis in East Africa caused by a severe drought and fighting in Somalia…” Approximately 10 million people in northern Kenya, Ethiopia, Somalia, Eritrea and South Sudan need urgent humanitarian assistance as the region experiences the worst drought in 60 years. An estimated 1,300 Somali refugees stream into Dadaab refugee camp daily following continued conflict in Somali, coupled with severe drought. The situation on the ground is getting worse as the world’s largest refugee camp- Dadaab, in Kenya has been forced to house people, four times its full capacity.

I echo Kimani wa Njuguna’s opinion on Tuesday that, “Rather than being preoccupied with weighty bread and butter issues which will add value to the lives of Kenyans, we have seen most elected leaders concentrating on non-issues like singing to the tune of tribal kingpins, how to escape paying taxes, and the 2012 elections.” Real issues are on the ground; drought, a looming food shortage, high inflation, delayed constitutional implementations, and so on. “A pessimist sees the difficulty in every opportunity; an optimist sees the opportunity in every difficulty”, Winston Churchill said. The Kenyan Government should savor the opportunity to act decisively and do something significant to comprehensively take care of the current drought situation.

What’s your say?

The Conversation begins…

References:

Kenya in urgent need of food aid, says US Daily Nation July 11, 2011

La Nina blamed for east African drought guardian.co.uk July 14, 2011

UN struggling to cope with East Africa drought Associated Press July 12, 2011

Executive Brief: La Nina and Food Security in East Africa August 2010 FEWSNET as of July 14, 2011

East African drought ‘worst in 60 years’ Channel 4 News June 28, 2011

Leaders must get their priorities right and put food security at top of agenda Daily Nation:-Opinion July 12, 2011

 

 

 

Replacing Paul Scholes

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Former Manchester United midfielder Paul Scholes

Paul Scholes decided to hang his boots at the end of last season, 2010/11; ending a successful career of 17 years dominating the midfield. This has left the Manchester United manager, Sir Alex Ferguson, with a huge task of finding a replacement for Scholes. The United boss says that it is impossible to replace Scholes, a player he ranks among the top four midfielders in the world.

The United boss is in the efforts of rebuilding a team that was out classed in all possible ways by FC Barcelona in the Champions League Finals. Having already made a combined £50million signing of Phil Jones, Ashley Young, and David de Gea; United have more room and money for at least one more signing to fill the position left by Scholes. Manchester United is targeting Inter Milan’s Wesley Sneijder as a possible Scholes replacement. Sneijder’s eye for goal, good vision, and accurate passing are some of the qualities the United boss is interested in.  Sniedjer, however, will not come cheap. Inter Milan are demanding an estimated £35million to release the player. The deal will also see Sneijder pocket £190,000 a week. Arsenal’s Samir Nasri and Luka Modric of Totenham were the other names linked with a move to United, but Sneijder is the main priority at moment with a deal expected to go through within the next 48 hours.

Manchester United and the fans expect the new signings to help the club clinch their 20th Premier League title and possibly the Champions League. A rebuilt Manchester United will face the ultimate test when the play Barcelona, arguably the best football team ever, in a friendly on 30th of July.
References:
An expensive gamble by Sir  Alex Ferguson FootballFanCast.com July 13th, 2011
Sneijder agrees terms with United Mirrorfootball.co.uk July 13th, 2011
Man Utd confident of landing £ 35m top target Footylatest.com July 13th, 2011

Facebook Launches a Video Calling Feature

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Facebook has launched a video calling feature powered by Skype. The announcement was made on Wednesday afternoon at the Facebook news conference. Along with the launch of video calling, Facebook also rolled out a new feature for group chatting. To get started with video calling, a small install is required; it can be downloaded from the Facebook site. The chat tool did get a little facelift as well.

httpv://www.youtube.com/watch?v=cqd_4KSbnJo

The announcement comes just a week after the launching of Google+ project, Google’s social network, which is currently in limited field trial. Google+ has its own video calling feature, Google Hangout, which supports group calls of up to ten users. Facebook’s video call currently supports only one-on-on calls, but the Facebook CEO, Mark Zuckerberg, said that most video calls are one-on-one and that is what Facebook is focusing on. Skype is also set to benefit from the partnership with Facebook by having their service accessible by the 750 million Facebook users.

Even though Facebook lacks group calling, video calling is expected to be a new and exciting experience to its massive user base. Video calling will ensure Facebook stays ahead of Twitter and Google+, who are said to its closest competitor.

References:

Facebook announcesSkype-Powered Video Chat BGR July 6th, 2011

Facebook Video Chat V. Google Hangout: It’s no contest Techcrunch  July 6th, 2011

Facebook Releases Group Chat Mashable July 6th, 2011

The Alcohol Dilemma

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In an already soaring economic environment, the so soon effected directive to increase excise duty on alcohol is projected to reduce government revenue.

On March 22nd 2010, National Campaign against Drug Abuse (Nacada) acceded to legalizing chang’aa so that its production can be regulated. On July 22nd the same year, Sam Ikwaye, the Executive Officer of the Pubs and Restaurants Association of Kenya (PERAK) was reported saying that “the proposed laws(Alcoholic Drinks Control Act) will do to the alcohol industry what the “Michuki Rules” did to the public transport sector.” However, we should note that the cause/effect of either vary significantly. Ideologically, the new alcohol law is designed to limit drinking hours in an effort to allow for more time to be spent on productive activities. In a society characterized with high unemployment, and rising cost of living, compounded by increased taxation on alcoholic drinks, it will be difficult to implement the Alcoholic Drinks Control Act because, frequent alcohol consumers who can now not afford the bottle would compulsively opt for cheaper nonstandard alcoholic drinks, which are still highly unregulated, thus reduced revenue collection from licensed alcohol. “Increase of excise duty on alcohol is ‘counter productive’ and likely to reduce government revenue from the industry which is one of the major contributors”, said Consultancy firm Deloitte and Touche Kenya.

Instead of aggressively enforcing regulation of the alcohol industry by strict adherence to directives by the district liquor licensing boards, the government should consider a more overt system to address the issue of alcohol abuse by establishing adequate and affordable rehabilitation facilities and advocate for aggressive civil education on the economic, social, and psychological effects of alcohol abuse. Do not bite the hand that feeds you, and two wrongs never make a right.

References:

High Alcohol Tax Likely to Affect Revenue-Analyst allAfrica.com June 10, 2011

License Chang’aa, Nacada tells State Daily Nation March 22, 2010

New alcohol law hard to effect, say players Daily Nation July 22, 2010

 

Fraud in the Ministry of Education

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More than 100 people, including top civil servants may face graft charges following a new forensic audit by the government revealing fraud involving Sh4.2 billion in the Education Ministry.

The Deputy Prime Minister Uhuru Kenyatta disclosed findings that alleged Sh4.2 billion intended for the Free Primary Education Programme (FPEP) is unaccounted for. Kenyatta, who is also the Finance Minister, handed over the audit report to the Criminal Investigation Department (CID) Director, Ndegwa Muhoro. Daily Nation website reported that, “according to Finance Minister Uhuru Kenyatta, the officials (in the Ministry of Education) not only stole the money, but also manipulated the records to hide the theft.” On one hand, Education Minister Prof. Sam Ongeri has sided with Uhuru Kenyatta in saying, “the focus was not going to be on prosecutions alone, but also on the recovery of the money, with the real possibility that some of the assets of those found guilty may be seized”, Daily Nation reported. On the other hand, Kenya Anti-Corruption Commission (KACC) Director, PLO Lumumba was reported accusing Uhuru Kenyatta of “putting on a show for the World Bank…” The article goes on to read that “Lumumba said Kenya is trying to look good before the world, whereas it is not, adding that the launch and handover of the report to the CID was meant to please the World Bank officials who are in the country to inspect the projects they sponsor.”  Last year, the U.K. Department For International Development (DFID) terminated its financial support to the Ministry of Education in Kenya citing, “It is vital that U.K. aid money is being spent on its intended purpose. We could not be sure this was happening and also we have stopped direct funding to the Ministry of Education in Kenya,” following a statement made by the DFID concerning allegations that some officials in the Ministry misappropriated the fund. Prior to the statement by the DFID, Prime Minister Raila Odinga suspended Ongeri from office for a period of three months following a report by PricewaterhouseCoopers Kenya and  Internal Auditor General, which “laid credible foundations…” African Press International (API) website reported. However, President Kibaki later annulled the suspension.

In 1970, Abba Eban, an Israeli diplomat, said, “history teaches us that men and nations behave wisely once they have exhausted all other alternatives.” Maybe this time the culprits involved in the scam will face the law. ‘Big and small fish’ alike all should be prosecuted, because only then will the government inch closer to recovering the lost billions and more so, toward ending the culture of impunity.

References:

How free education billions were stolen Daily Nation June 16, 2011

Heat over missing billions for schools The Standard June 14, 2011

DFID Halts Funding for Kenyan Education Ministry Devex March 16, 2010

Ministers Ongeri, Ruto suspended by PM Raila over graft: Will his action breed powerful

enemies and destroy his chances to seek presidency come 2012? African Press International February 14, 2010

 

The Migingo,Ugingo Dispute

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His Excellency the President of Kenya, Hon. Mwai Kibaki, in his speech at Nyayo Stadium, addressing the nation on the 48th Madaraka Day celebration rendered that the disputed islands of Migingo and Ugingo belong to Kenya. He was quoted saying, “I also wish to reassure all Kenyans that the islands of Migingo and Ugingo lie squarely on Kenyan territory in Lake Victoria.”

 

Capital FM website on May 1st reported that, “Ugandan Security forces operating at the two islands, both lying about 15km from the shorelines of the lake on the Kenyan side of the border have in the past defied exit orders issued by the Kenyan government.” On 3rd June 2011, allAfrica.com reported that “Ugandan authorities have told their troops to ignore President Kibaki’s statement declaring Migingo and Ugingo islands in Lake Victoria as Kenyan territory…” This has been seen as a response to Kibaki’s statement on Madaraka Day that partly read, “My Government is committed in providing security for all. We have intensified patrols along the borders to contain any forms of crimes.” The Ugandan forces in the area have further been reported to have “warned Kenyan Fishermen in and around both islands to obey their administration and expect no change of guard there.”

This has not been the first time that Kenya and Uganda have conflicted over the two islands, On March 9th 2011, Capital FM reported the American Ambassador, Michael Ranneberger saying, “There is some speculation that Kibaki’s silence on the issue is designed to embarrass Prime Minister Odinga, showing him powerless to resolve the dispute which negatively affects his ethnic Luo community.” Uganda has continuously insisted that Migingo and Ugingo islands are in their territory. The Ugandan Marine Police on both locations  have been collecting taxes from Kenyan Fishermen and even going further to harass and arbitrarily arrest the Fishermen. Kibaki has always advocated for a diplomatic solution but Wikileaks reported that the Ugandan “seizure” of Migingo Island is an emotive issue among Kenyans living around Lake Victoria, who also form the bedrock of Mr. Odinga’s political support, reported Africa Review website.httpv://www.youtube.com/watch?v=X-gNt3n8ZlU

 

Flashback to April 7th 2009 and Daily Nation website reported that “Kenya President and his Ugandan counterpart Yoweri Museveni held talks over Migingo Island and agreed that the issue must not be allowed to overshadow the good relations between the two countries.” A joint communiqué was signed between the two countries the previous month.httpv://www.youtube.com/watch?v=s6EwrF7wjUM Thus, this issue should not be allowed to spill over yet again considering also that the region’s countries are having hard economic times. At all costs, both countries should seek a mutually agreeable solution that will uphold human rights and fair co-existence. The Kenyan government executives should stop holding political grudges and work as parts of one unit, purposely to move Kenya forward on the growth agenda.

 

References:

Kibaki and Museveni Agree on Migingo Daily Nation April 7th,2009

Migingo,Ugingo islands belong to Kenya, Kibaki declares The Standard June 1st,2011

Kenya’s President ‘set PM up’ in Migingo island dispute Africa Review March 9th,2011

Kibaki says Migingo, Ugingo in Kenya Capital FM June 1st,2011

Uganda to Ignore Kibaki On Islands June 3rd,2011

Kibaki ‘Set Raila Up’ in Migingo Dispute March 8th,2011

 

Government to Control Opinion Polls

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MP Jamleck Kamau(Kigumo), on 11th May, 2011, moved a motion before the house urging the government to “develop a framework that includes an Opinion Polls Controls Board for the regulation and conduct of the opinion polls…” MP for Naivasha, John Muthutho seconded the motion saying, “the pollsters were to blame for the political chaos that rocked Kenya in the 2007 elections,” allAfrica.com reported.

Jamleck who is the PNU (Party of National Unity) Vice-Chairman, in his statement made in parliament pointed out that “propaganda and misinformation are potent tools for destabilization of peace and stability especially during the electioneering period…” The Bill which Jamleck, Muthutho and a team of allied lawyers are working on purposes to “put discipline and restore professionalism in the operations of research so far as opinion polls are concerned,” Jamleck said.  The Bill will create an Opinion Polls Control Board that will be under the office of the Vice-President according to the proposed legislation. In response to this developing story, the Managing Director of Synovate Kenya, George Waititu said that in Kenya, research companies work under the Market and Social Research Association that regulates their operations. The proposed legislation will “require research companies to declare to the Board the sponsor of the survey and the organization behind the survey. The Board will require that the research company declare the date of the survey, the population from which the sample respondents were drawn, the number of people contacted to participate, and the margin of error in the obtained data.” allAfrica.com reported.

Laws and Regulations Restricting the Publication of Electoral Opinion Polls introduces that, “one specific area in which restrictions on freedom of expression have been imposed to protect the integrity and fairness of the electoral process is in relation to the publication of pre-election opinion and exit polls. Pre-election polls are public surveys which assess the views of the electorate on various election-related matters while exit polls take place immediately after people have voted and assess the level of support for the various parties and candidates. Media coverage of such information can, at times, be controversial. This is particularly true of polls and projections commissioned or conducted by a source that is not impartial. Furthermore polls may be subject to manipulation at many levels; in the choice of questions, the choice of sample, the time that the questions are asked, and so on. It is often perceived, therefore, that polls and projections may have a distorting effect on the vote, rather than simply reflecting public sentiments.” What the MP’s are proposing is appropriate only that they are not doing it the right way. Many democratic governments have tried it in their respective jurisdictions but failed because this issue is pertinent to and touches on the delicate issue of freedom of speech and expression. Instead, the government should find ways to strengthen relations and build trust with civil institutions (including research institutions) through the various established regulatory bodies, and be a government that works for, and with the people.

References:

Ban Opinion Polls-PNU allAfrica.com 12th May,2011

Ban Opinion Polls Mynucleus.org 12th May,2011

Laws and Regulations Restricting the Publication of Electoral Opinion Polls Google Docs (as of) 12th May,2011

Mixed reactions to PNU plan to ban opinion polls The Star 13th May,2011

 

Unexploded Ordnance Kills Five Children

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Four children aged between six and twelve were killed on Sunday following a fatal detonation of what has since been said to be an anti-personnel bomb. A fifth child involved in the same incident succumbed to injuries while undergoing treatment at the Kenyatta National Hospital. The explosion occurred 25 kilometers north of Ngong Town, while the five youngsters were out grazing cattle in Ole Maroroi village, Ewaso Kedong.

Police have revealed that the bomb was an unexploded munition from the nearby Ngong Range, used for training by the military and police. This incident is related to similar accidents reported in Samburu, where there have been explosives left behind after military training sessions by the local and military personnel from Britain. News From Africa reported that, “more than 200 accidents have been recorded in the area where the British forces have been carrying out exercises.” Unexploded ordnances, sometimes brightly coloured, are compared to toys that attract children. These unexploded ordnances are “explosive weapons (bombs, bullets, shells, grenades, land mines, naval mines, etc.) that did not explode when they were employed and still pose a risk of detonation…”- Wikipedia.org. Human Rights activists have indicated that, “one in four casualties resulting from sub-munition that fail to explode on impact are children who often pick up and play with the explosive canisters…” UN Secretary General Ban Ki-moon spoke of “not only the world’s collective revulsion at these abhorrent weapons, but also the power of collaboration among governments, civil society and the UN to change attitudes and policies on a threat faced by all humankind”, referring to his contribution as the Convention on Cluster Munitions, Dublin, entered into force.httpv://www.youtube.com/watch?v=1p82jNCJNlk Kenya signed the Convention on Cluster Munitions (CCM) in Oslo, Norway in December 2008 to express her “commitment to support efforts aimed at limiting the indiscriminate effects to civilians of Cluster Munitions as areas affected are not suitable for economic development and growth.” However, Kenya has not yet ratified the treaty. The Attorney General’s office alleges that competing priorities have stalled the process, and that ratification of the treaty in Kenya requires approval by the cabinet. Nobel peace prize winner Jody Williams called the convention “the most important disarmament and humanitarian convention…”

Capital FM website reported on May 9th that, Military Spokesman Bogita Ongeri was “non committal when asked if families of the children killed will be compensated by the Department of Defense.” The government should speedily ratify the CCM such that Kenya joins other States Parties who have “resolved to do their utmost in providing assistance to Cluster Munition victims, including medical care, rehabilitation and psychological support, as well as providing for their social and economic inclusion.”httpv://www.youtube.com/watch?v=MlcGHj5sosY&feature=player_embedded#at=25

 

References:

Tragedy as four boys are killed in bomb blast DAILY NATION May 11th,2011

Military on the Spot over Death of Five Boys News From Africa May 10th,2011

KENYA’S RESPONSE TO THE UNITED NATIONS SECRETARY
GENERAL’S REQUEST FOR VIEWS ON INTERRELATION
BETWEEN ARMED VIOLENCE AND DEVELOPMENT Google Docs (as of) May 11th,2011

Kenya Cluster Munition Ban Policy Landmine & Cluster Munition Monitor (as of) May 11th,2011

DIPLOMATIC CONFERENCE FOR
THE ADOPTION OF A CONVENTION
ON CLUSTER MUNITIONS Google Docs (as of) May 11th,2011

 

 

Americans Kill Osama bin Laden in Pakistan

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After a 10 year manhunt in Afghanistan for Osama Bin Laden it is finally over. In a 40 minute Navy SEALs operation, Osama was killed with one shot to the head.  Osama was the leader of Al-Qaeda and the mastermind of the September 11, 2001 (9-11) terrorist attack on the world trade center buildings in New York, the Pentagon and Pennsylvania. In Kenya Osama Bin Laden was responsible for the slaying of innocent victims in the 1998 bombing of the US Embassy in Nairobi.

In a dramatic late-night appearance in the East Room of the White House, Obama declared that “justice has been done.” After he refused to surrender, Bin Laden used a woman in the compound as a human shield to no avail.  Bin Laden was killedby the hands of the elite forces of the Navy SEALs and the CIA at a lush compound about 1.5 hours away from the Pakistani capital in the city of Abbottabad. Immediately following his killing, special forces conducted a live DNA test on Osama’s body. The process was watched in real-time by CIA director Leon Penetta. Bin Laden’s body was later buried by American forces at sea within 24 hours of his death as is required by Islamic tradition.

Visit msnbc.com for breaking news, world news, and news about the economy

Kenya suffered the wrath of Al-Qaeda terrorist attacks in 1998 with the killing of over 200 people in Nairobi and subsequent attacks in Kikambala and Mombasa. As leaders and the world rally to congratulate President Obama and the US forces, we should all pause to remember all the innocent lives lost in East Africa, America, Pakistan, Afghanistan, and Iraq under al-Qaeda and the hunt for their fallen leader, Osama Bin Laden.  Obama’s administration has done justice for not only Americans, but for all world citizens.

References:

Osama’s death is being featured on My Nucleus: http://www.mynucleus.org/featured