Rank: Chief Joined: 1/3/2007 Posts: 18,137 Location: Nairobi
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Who owns Mobicom?Mobicom, one of Kenya’s largest and most seasoned telecom dealers, has ended its contract with market leader Safaricom as the battle for control of the mobile phone market takes a new shape with the expected entry of India’s Bharti Airtel.
The firm, estimated to control nearly 10 per cent of Safaricom’s dealership revenue, ended the nine-year contract last Tuesday and will instead market the services of rival Zain.
Key players
Safaricom’s 400 dealers handled more than Sh5 billion worth of business per month by September last year – excluding the M-Pesa business estimated to have been worth more than Sh10 billion per month.
Together with the sale of the wireless internet modems, laptops and phones, the monthly business turnover handled by the dealers stands at more than Sh20 billion a month, making them key players in the telecoms market.
At Zain, Mobicom becomes the 86th dealer for Kenya’s second largest telecoms operator by subscriber base.
Winning Mobicom – one of the few dealers with a national footprint — to its side offers Zain a much larger sales platform to spread its footprint and increase visibility in the marketplace.
Rene Meza, Zain Kenya’s managing director, said the company has been talking to Mobicom and other established dealers for partnerships to help strengthen its distribution network but had sealed no deal by last Friday.
“Our new strategy is to focus on rural areas and dealers are key pillars to the achievement of such a goal,” said Mr Meza, adding: “We have been talking to a number of established dealers including Mobicom as they have the experience and the financial capability to take our products down to the subscribers.”
Bharti, the new owners of Zain, have recently announced plans to spend part of the $150 million they intend to invest in Kenya on shoring up their distribution network and improving quality.
Safaricom chief executive Michael Joseph confirmed that Mobicom had terminated their contract with the firm but declined to comment further.
“I do not wish to comment on this until I understand the reasons behind the move,” said Mr Joseph, who will be retiring as Safaricom’s chief executive
in November.
A wide dealership network that offers its subscribers access to the company’s products such as airtime and M-Pesa has been one of the key pillars of Safaricom’s market leadership with 78 per cent of the voice market.
Safaricom has 500 dealers compared to Zain’s 85 for 10.4 per cent of the voice market, Telkom Kenya’s 56 for 5.6 per cent and Essar’s Yu with 20 for 5.6 per cent.
The operators have been using different incentives to woo and keep the dealers in their stable.Greedy when others are fearful. Very fearful when others are greedy - to paraphrase Warren Buffett
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