CIO East Africa (Nairobi)

Kenya: Airtel Hikes Cross-Network Calls, Offers Bundles for Calls Within Network

Airtel Kenya has reviewed its call rates upwards. This comes in the background of a decrease in mobile termination rates (MTR), which is the rate that mobile providers pay each other for handling calls from other networks. The industry had expected Airtel to drop calls further, but the operator has instead moved in the opposite direction by increasing charges for cross network calls . Rates within the network had either remained unchanged of have been decreased for users who buy bulk bundles.

Dubbed Pamoja, the new tariff bundles calls within Airtel in daily bundles where the price drops when the user buys a higher bundle. Pamoja 5 will cost KSh. 3 per minute to Airtel, Pamoja10 KSh. 2.4 per minute to Airtel, Pamoja20 KSh. 1.8 per minute to Airtel,

Pamoja30 KSh. 1.2 per minute to Airtel. Calls to other networks will be charged at KSh. 3.6 per minute.

Daily Bundle

Cost (Kshs)

Seconds

Airtel to Airtel

Effective call

rate per second

Pamoja5

5

100

5 cents

Pamoja10

10

250

4 cents

Pamoja20

20

667

3 cents

Pamoja30

30

1,500

2 cents

Customers can subscribe to the Pamoja bundles by dialing *767# .

Other Airtel tariffs have also seen their rates adjusted with their equivalent of peak Airtel to Airtel calls now at KSh. 3.6 per minute (6 cents per second) and an off peak rate of KSh. 1.2 per minute within Airtel. Calls to other networks will cost KSh. 3.6 per minute

In August 2010, with Airtel's purchase of then Zain, the operator cut call rates by about 60 percents, a KSh. 5 drop from KSh. 8 to KSh. 3. The move saw competitors similarly drop rates to about KSh. 3. This was after the Communications Commission of Kenya (CCK) cut MTRs from KSh. 5.57 to kshs. 2.21 on September 1st 2010.

In September 30th, 2011, Safaricom increased its rates to KSh. 1 to KSh. 4 within the network and KSh. 5 to other networks, saying that the lower rates were no longer sustainable.

On 26th November 2012, CCK announced the drop of MTRs from KSh 2.21 to KSh 1.44, sparking speculations of another price war.

Airtel had lowered the call rates hoping that the move would lead to longer calls and hence more revenues such as happens in India.

CCK statistics for the fourth quarter 2011/2012 show that Safaricom has 64 percent of the mobile market share compared to 16.5 percent for Airtel, 10.5 percent for Orange and 9 percent for Essar Yu. In the same period, Airtel had 11.2 percent of Kenya's mobile voice traffic compared to safaricom's 78.9 percent.

Airtel's voice traffic consisted of 279 million minutes within the network and 430 million minutes to other networks.

Minutes per user dropped from 89.3 a year ago to 71.2 between April and June 2012. India had 346 minutes of use per user for the same period.

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