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Why safaricom must reduce its costs and expenditures to remain a viable stock in future

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gathinga		#51 Posted : Thursday, September 09, 2010 9:28:57 AM
Rank: Veteran Joined: 11/30/2006 Posts: 635		Daily Nation page 7: Zain's new offer. Nokia 1280 with 1800 free airtime(150/- monthly for 12 months). This is a terrific offer for those safcom subscribers who want to buy a zain line for making calls only. clearly this war is headed to the gutters!
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selah		#52 Posted : Thursday, September 09, 2010 9:42:02 AM
Rank: Elder Joined: 10/13/2009 Posts: 1,950 Location: in kenya		KenyanLyrics wrote: According to a Safaricom insider, here is their plan for the war: Voice is, and will always be the core business of a mobile phone company. Anything said otherwise is just to maintain customer and investor confidence. On that premise, Safcom are absolutely 100% sure that Zain's pricing model is unsustainable. So what was the reasoning behind Safcom's reaction? Safcom want to call Zain/ Airtel's bluff on their tariff. The contentious issue here being the promise of the tariff being 'forever.' Safcom has said that they will launch a one month 'Masaa ya Kubamba' offer. The great unknown is what will happen after this one month is over? Safcom will decide to 'extend' their offer. On top of this, they will expand the reach of the offer to another service. Safaricom keep playing this game of Russian Roulette for the better part of a year, till one day, after realising that all the major profit avenues have been closed, Zain/ Airtel deals itself the inevitable fatal blow, and reneges on it's '3bob forever' promise. Customers feel betrayed, run back into the arms of their ex, Safaricom, who can now restore normal super-profits by declaring 'Masaa ya Kubamba' over. Meanwhile, the whole saga sends a chilling message to other operators that you just don't mess with Safcom. Your analogy is completely wrong safaricom is really in trouble I am a die hard safaricom mind you but safaricom strategy this time round is completely outsmarted by the indians.When you loose confindence/trust from your target market its hard to redeem it.The final blow will come with the portability service. The only way safaricom can redeem themself is by taking this price war seriously first they cut their cost on MPESA,DATA, voice to a bearable minimum and boost their customer care. Bharti has done something which is unsustainable Now but if they get a critical mass they will make profits. '......to the acknowledgment of the mystery of God, and of the Father, and of Christ; 3 In whom are hid all the treasures of wisdom and knowledge.' Colossians 2:2-3
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mv_ufanisi		#53 Posted : Thursday, September 09, 2010 9:52:20 AM
Rank: Member Joined: 1/15/2010 Posts: 625		KenyanLyrics wrote: According to a Safaricom insider, here is their plan for the war: Safcom will decide to 'extend' their offer. On top of this, they will expand the reach of the offer to another service. Safaricom keep playing this game of Russian Roulette for the better part of a year, till one day, after realising that all the major profit avenues have been closed, Zain/ Airtel deals itself the inevitable fatal blow, and reneges on it's '3bob forever' promise. Customers feel betrayed, run back into the arms of their ex, Safaricom, who can now restore normal super-profits by declaring 'Masaa ya Kubamba' over. Meanwhile, the whole saga sends a chilling message to other operators that you just don't mess with Safcom. In December number portability will come in, this will be the final blow for Safcom. They better not be thinking like this for the sake of their company. They will lose big when portability checks in. Orange, Zain and Yu will be ready to go for the kill at that time. Safcom better be prepared.
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the sage		#54 Posted : Thursday, September 09, 2010 10:07:02 AM
Rank: Member Joined: 11/20/2008 Posts: 367		[quote=sparkly]Zain and orange were making losses when the calling rates were 8 bob. Sasa with calls at 3 bob mambo kwisha. Someone will have to pull off their punching gloves and that in my guess will be zain. Saf will be left to screw us some more and make a trillion in profits But CCK has also said that it will further reduce interconnection fees. July 2011-Sh1.44 July 2012-Sh1.15 July 2013-Sh.99 IMHO data, mobile money transfer services, banking, utility are the next battlegrounds.
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alma		#55 Posted : Thursday, September 09, 2010 10:10:00 AM
Rank: Elder Joined: 7/20/2007 Posts: 4,432		Someone should tell safcom that we are not interested in their marketing plans and fatal blows. we are interested in lower prices. To be more precise, fair pricing that does not allow them to make 60% profit margins on my back. People will never pay 8 bob a minute...ever again. so they had better get used to that. After number portability, there will be no reason on earth to stick with safcom other than "i am a shareholder"...they can go green all they want and have the "best marketing team" in kenya. But if that call rate goes higher than 3 bob a minute, they are KWISAAA! I am waiting for data. 4G and zain 3G will come out at the same time...Let us see if I'm right when I say, I would rather pay 500 bob a month on 3G than 5000 bob a month on 4G.... If safcom does not get it, then these indians will just continue bending them over every month. Jose: If I make it through this thug life, I'll see you one day. The Lord is the only way to stop the hurt.
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jguru		#56 Posted : Thursday, September 09, 2010 10:12:01 AM
Rank: Veteran Joined: 10/25/2007 Posts: 1,574		Safaricom has no other "better option" but to cut costs. Otherwise the profits (or losses) will be embarrassing at the next announcement. I said it here too: http://wazua.co.ke/forum...&m=101675#post101675 Set out to correct the world's wrongs and you will most certainly wind up adding to them.
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VituVingiSana		#57 Posted : Thursday, September 09, 2010 10:20:38 AM
Rank: Chief Joined: 1/3/2007 Posts: 18,349 Location: Nairobi		SafariCON is the CONplicated Option Greedy when others are fearful. Very fearful when others are greedy - *to paraphrase Warren Buffett*
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selah		#58 Posted : Thursday, September 09, 2010 10:28:22 AM
Rank: Elder Joined: 10/13/2009 Posts: 1,950 Location: in kenya		why is everybody quoting the 8/= everytime saf is mentioned at those rates Yu was the cheapest at 6.50 while Zain was @ 8/= before going to 7.50/-and finaly to 6/= so when you commend zain remember the pple who made calling cheap is YU(Essar) our liberator. '......to the acknowledgment of the mystery of God, and of the Father, and of Christ; 3 In whom are hid all the treasures of wisdom and knowledge.' Colossians 2:2-3
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Wendz		#59 Posted : Thursday, September 09, 2010 10:53:15 AM
Rank: Elder Joined: 6/19/2008 Posts: 4,268		selah wrote: why is everybody quoting the 8/= everytime saf is mentioned at those rates Yu was the cheapest at 6.50 while Zain was @ 8/= before going to 7.50/-and finaly to 6/= so when you commend zain remember the pple who made calling cheap is YU(Essar) our liberator. I think when MJ said we have peculiar calling habits he was right. We are screaming hoarse of how we were exploited by Safcom when all other providers were cheaper and we did not vuka. As we speak, we are all praises to Zain for lower rates and completely ignoring YU which is on its knees pleading with us to give it a chance to allow us to call to any network for 50 cents....... and we arent even seeing that. If you are not in YU, then stop talking of switching providers because you were exploited.... then one you have now is also exploiting (bearing in mind exploitation is relative).
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chris79		#60 Posted : Thursday, September 09, 2010 11:05:11 AM
Rank: Member Joined: 7/31/2007 Posts: 341		@Wendz, 50 cents per second is still 3 bob per minute. That's just a marketing gimmick...
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