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Safaricom slashes SMS tariffs as price war hots up

September 14, 2010 • Mobile and Telecoms, Top Stories

Outgoing Safaricom CEO Michael Joseph


THE good times keep rolling for Kenyan cellular subscribers following Safaricom’s unveiling of the cheapest SMS tariffs in the country’s telephony market.

Dubbed “Masaa ya SMS”, the move is seen as a strategy to beat the November deadline set by the Communication Commission of Kenya that could see the average cost of an SMS fall under one shilling.

The Safaricom tariff reduction will give the network’s 16 million subscribers the opportunity to send text messages for as low as 20 cents each — the lowest charge for a text message in the Kenyan market currently.

The firm’s PrePay and PostPay customers will benefit from the tariff slash.

The plan, launched under the tagline “Say more for less permanently, on the Better Option”, allows subscribers to send text messages within the network at the lower rates, depending on what SMS bundle one selects.

Announcing the tariff changes, outgoing CEO Michael Joseph said a bundle of 100 SMS will be available at Sh20, which denotes a unit price of 20 cents per message sent.

“Subscribers will be able to buy some 20 text messages for Sh10, translating into 50 cents per text message, while the last bundle, for Sh5, will afford one five text messages, meaning a unit price of Sh1 each,” said Joseph.

“Masaa ya SMS is a permanent tariff and not a promotion,” he assured subscribers.

According to the director general of the CCK, Charles Njoroge, there were glaring distortions in the pricing of SMS services in the country.

“CCK considers the wholesale termination rate of two shillings per SMS negotiated by the operators extremely high. All operators must renegotiate lower mobile and fixed SMS termination rates and file the new rates with the Commission within three months,” said Njoroge.

Joseph said “Masaa ya SMS” was a way of thanking the firm’s over 16 million subscribers for their loyalty.

“We shall continue creating true value for our subscribers by deliberately listening to them and coming up with products and services that best answer their needs,” he said.

Safaricom has been charging a uniform rate of Sh3.50 for SMS. Zain Kenya, Essar and Telkom Kenya are currently charging between one and two shillings respectively for SMS on their networks.

CCK said SMS services to consumers cost only 0.01 for each SMS sent over a network.

In recent weeks a brutal price war has broken out between the mobile operators, slashing the cost of calls between networks by at least 50%, and in some cases 75%. The cuts have come so fast and are so deep that they caused Kenya’s August inflation rate to drop.

BRIAN ADERO in Nairobi, Kenya

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