The Communications Commission of Kenya (CCK) has slashed the mobile calling tariff by 20 per cent after a gruesome price war among the Kenyan network operators.
The changes, which take effect today, will see operators charged KSh1.15 a minute to terminate calls on other networks, down from KSh1.44 a minute.
The regulator’s director-general Francis Wangusi said operators have already started to implement the reduction.
“From the returns we are getting from the operators, the third phase has commenced,” said Wangusi.
Shivan Bhargava, Airtel Kenya’s managing director, said the firm has implemented the new mobile termination rate (MTR) and passed the savings onto its customers through new product offerings.
“Airtel recently launched new value bundles ‘Airtel Tosha’ that give its customers up to 20 times more on voice calls, SMSes and data on a low daily subscription rate in anticipation of the glide path implementation,” Bhargava said.
Though many Kenyans expect the new rates charges to be passed onto them through cheaper calls, some providers have insisted that the consumers should not anticipate cheaper call charges.
“The rates are already low. Using KSh10 a day is like the calls are free,” yuMobile Kenya country manager Madhur Taneja said, terming the move by the regulator to cut the rate further as “good for the industry”.
In 2010 Airtel initiated a price war when they lowered their call charges to an all time low after the CCK cut the rate by half to KSh2.21, which forced other operators to lower their charges as well causing a rapid drop in profits for the industry.
The MTR which mobile operators charge each other to terminate calls from another network, is expected to fall to KSh0.99 next year, according to a “glide path” developed by the regulator in 2010.