Not bad, not bad.
As the man on the street, I am more than happy! Hehe..It would even be better if I can get free calls.
If I had shares in Zain, I might not be so happy.
Everytime a Zain subscriber calls SafCON, Zain collects 2.38 i.e. 3/- less tax of 26%.
Now the interconnection rate is Ksh. 4.42 so they hand over 4.42 to SafCON leaving them out of pocket by Ksh. 2.04
(Somebody check this maths, I am no expert on interconnection and possibly the 4.42 is remitted net of tax).
I have heard the argument about subscriber acquisition and that there will be momentum as the new subs acquired will also have a club effect calling each other on Zain-to-Zain, but this is still a gamble. I suspect people who have both SafCON and Zain SIMs will just use Zain SIMs to call more and especially call SafCON numbers as well.
If on the other hand Zain erodes only Orange and Yu,then more profit to SafCON. I suspect SafCON will just tinker with their Supa Ongea and make sure that 3/- and 4/- are showing a little more often...heck, even put certain parts of the day to have 2/-...but MJ is not a fan of price-wars so they may just ride the storm.
However, perhaps Zain knows something that we all don't e.g. CCK has been hinting at lower interconnect rates and if this happens, Zain may just pull this off.