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Why safaricom must reduce its costs and expenditures to remain a viable stock in future
muganda
#71 Posted : Thursday, September 09, 2010 5:32:39 PM
Rank: Elder

Joined: 9/15/2006
Posts: 3,907
KulaRaha wrote:
Ndemo lives in the stone age.

@KulaRaha, you've imputed wrong motive, yet Mr. Bitange Ndemo is argued to be one of the most hardworking, effective Permanent Secretarties well respected by all players in ICT industry.

In fact Fibre Optics, TEAMS, lower Interconnect Rates, Digital Villages, Kenya ICT board, strides in Business Process Outsourcing, e-Government, duty free computer regime, local digital content, empowering young entrepeneurs are some of this achievements.

With a PhD in Industrial Economics from the University of Sherfield UK, an MBA from the University of Minnesota and University of St. Thomas, and a Bachelors Degree in Finance; he is much more qualified than most of us on this matter.



KulaRaha
#72 Posted : Thursday, September 09, 2010 5:38:31 PM
Rank: Elder

Joined: 7/26/2007
Posts: 6,514
Then I retract my words, but I cannot believe such a "progressive" individual is upset that there is a mobile price war on...doesn't make sense don't you think? He should be encouraging the war, rather than worrying about it. He wants uptake, doesn't he? Or is he worried about the corporates' profits?
Business opportunities are like buses,there's always another one coming
Much Know
#73 Posted : Thursday, September 09, 2010 5:49:22 PM
Rank: Elder

Joined: 12/6/2008
Posts: 3,579
@Kularaha, the Indian mobile market has 650million users, Bharti alone has 150million, however analyst expect a telcos bubble to burst in India due to price wars (layoffs, closing down of mobile companies e.t.c). Bharti had a major decline in profits (32%) in the last financial year and it's competitors, the main one reliance has it's profits nearly wiped out. Bhartis main incentive for buying African operations was to try and escape the imminent chaos that will surely happen in India. Indians are obsessive (even nonsensical) about saving, they switch of vehicle lights in lit roads to "save the battery". Bharti sold out it's entire mobile infrastructure in the process of these wars, so? Why should Ndemo cheer? By the way, it is important to consider profits from well managed private companies as an informal tax rather than feel bitter about "supernormal profits". Safcom was able to acquire 3G earlier than Bharti was in India, they were able to put in funds into a much required fiber optic cable, in the end these gains accrue to you amongst other infrastructural developments they are undertaking. Cheap is sometimes cheap.
Ras Kienyeji Man
KulaRaha
#74 Posted : Thursday, September 09, 2010 6:11:38 PM
Rank: Elder

Joined: 7/26/2007
Posts: 6,514
Much Know,

Safcon made $250M in profits last year from 13 million subscribers. Bharti made $ 300M (extrapolated from $150M at half year i.e. Sept 09) from 150 million subscribers.

Who do you think would buy 3G first? The big telco fighting for small profits, or the small telco making a killing on a tiny subscriber base?

So what gains did I accrue when my telco made the same profit as a telco 10 times their size? The profit came from somewhere right? Probably me? WOW, genius!

Wake up...you have been exploited and everyone is now panicking because the exploitation has ended. The telco is panicking, the govt is panicking, even those poor delusional shareholders with miniscule shares are panicking.

When a ship sinks, the rats always jump off first.
Business opportunities are like buses,there's always another one coming
youcan'tstopusnow
#75 Posted : Thursday, September 09, 2010 6:21:32 PM
Rank: Chief

Joined: 3/24/2010
Posts: 6,779
Location: Black Africa
Wow! So every Safaricom subscriber contributes 19 dollars to yearly profits while Bharti customers contribute only 2 dollars? Hmmm... Call it what you want, but Safcom has been screwing people in the ass!
GOD BLESS YOUR LIFE
gathinga
#76 Posted : Thursday, September 09, 2010 6:24:01 PM
Rank: Veteran

Joined: 11/30/2006
Posts: 635
KulaRaha wrote:
Much Know,

When a ship sinks, the rats always jump off first.


Applause Applause
KulaRaha
#77 Posted : Thursday, September 09, 2010 6:25:46 PM
Rank: Elder

Joined: 7/26/2007
Posts: 6,514
youcan'tstopusnow wrote:
Wow! So every Safaricom subscriber contributes 19 dollars to yearly profits while Bharti customers contribute only 2 dollars? Hmmm... Call it what you want, but Safcom has been screwing people in the ass!


Hallelujah my brother...you have seen the light!! And every Safcon subscriber uses 75 minutes while Bharti ones use 450. Looks like we were being screwed not just in the ass....

What infrastructure assistance has Safcon brought? They bought all that fibre and 3G with your money, not theirs!

Don't beleive the hype....
Business opportunities are like buses,there's always another one coming
Much Know
#78 Posted : Thursday, September 09, 2010 6:42:39 PM
Rank: Elder

Joined: 12/6/2008
Posts: 3,579
@kula safs income is not only voice, there is staff like mpesa etc, as Ndemo was trying to explain, safcoms investment in data will enable poor kids in rural areas access books on those chinese tablets? What will zain with its losses do?
Ras Kienyeji Man
mv_ufanisi
#79 Posted : Thursday, September 09, 2010 7:14:11 PM
Rank: Member

Joined: 1/15/2010
Posts: 625
youcan'tstopusnow wrote:
Wow! So every Safaricom subscriber contributes 19 dollars to yearly profits while Bharti customers contribute only 2 dollars? Hmmm... Call it what you want, but Safcom has been screwing people in the ass!



Herein lies the problem. Safcom has lost credibility coz people now realize they were getting screwed and overcharged to fund hyper-profits by a near monopoly.
Trust is a pretty hard thing to win back. That's SCOM real loss. Airtel needs to do a SouthWest-like ad blitz to get the people on their side. It would go something like this:
"Before we came in with our new offers: Kenyans were paying through the roof for calls (show a Kenyan calling and having to talk super fast and the dial tone for no more money coming immediately after just filling up with credit).
Airtel has come into the market with new rates designed to ease your communication hustle (show a Kenyan talking and talking but still has credit). Then have a voice warning the viewers that if they don't support Airtel the big bad wolf will wait and then go back to the high prices regime - it's a temporary offer remember? Then ask the public to support the under-dog, talk about their good service, strong networks etc. Maximize the impact of this thing. Are any smart Airtel management people reading this? ... It's a classic HBS case.
KulaRaha
#80 Posted : Thursday, September 09, 2010 7:16:15 PM
Rank: Elder

Joined: 7/26/2007
Posts: 6,514
India with 650M subscribers considers the pool too small to make any visible impact on their profits from non voice products.

Kenya with 16M subs considers this the insurance against voice profits.

Even though we probably pay 10, maybe 20 times their rates for substandard Internet, do you think it will it help??

As for Safcon foundation, which telco won't spend lees than 1% of profits on CSR?
Business opportunities are like buses,there's always another one coming
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