Orange Kenya protests MVNO licences

Orange Kenya protests MVNO licences

CC image courtesy of @fran on Flickr

Orange Kenya has written to the Communications Authority of Kenya (CAK) complaining of an oversight of rules of engagement and parameters on how mobile operators should do business after the regulator issued licences to three mobile virtual network operators (MVNOs) in the absence of contractual guidelines.

HumanIPO reported last week the CAK issued MVNO licences to Finserve Africa Limited, a subsidiary of Equity Bank, Zioncell Kenya Limited and Tangaza’s Mobile Pay Limited, giving them the opportunity to set up and provide mobile cellular services without the need to heavily invest in the rollout of infrastructure – with the three companies having entered into an agreement with Airtel Kenya.

Business Daily reports Orange Kenya chief executive officer (CEO) Mickael Ghossein told the newspaper the lack of clarity from the regulator had made it difficult to strike deals with parties that have approached the company, with the result now being inequitable distribution of partnerships and market concentration of MVNOs with a single operator.

“We are not opposed to the MVNOs. However we have written to the regulator seeking clarification on specific issues such as the lack of framework that guide the operators and the MVNOs when entering into contracts,” said Ghossein.

Ghossein said one of his major concerns was that the licence only costs KSh100,000 (US$1,200) yet the parties will be able to offer all services, including voice, data, mobile money transfer services and SMS. This automatically makes them serious competitors yet they will not have invested as much as the telecoms.

“The MVNOs will be assigned their own numbering range where they will request and provide services as bona fide entities,” Francis Wangusi, CAK director-general, said, meaning that they will operate independently and compete with the host network provider in the services they offer.

Wangusi said the authority is working on the policy guidelines and will release them before June.

“The MVNO licence has been issued under the Application Service Provider (ASP) category to provide all forms of services to end-users using the communications infrastructure of a licensee under Tier I category (the four mobile operators),” he said.


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