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discrimination, discriminatory provisioning of as well to use commercial resources in order to
network facilities, overpricing of essential facilities achieve development goals. 25
and other network elements and services provided
to competitors, unfair trade practices, tie-in sales, Some of these issues can be clarified through
and anticompetitive bundling). asking questions such as these:

One of the more likely outcomes is that an • Are the regulatory arrangements for
m-service or app that rides on a large network infrastructure-sharing adequate to achieve
will ultimately benefit from network effects, goals for national access?
much to the discomfort of other operators in
the same market. This happened in Kenya when • Are the exclusive arrangements governing
Airtel Money, which operates the second-biggest m-services and apps riding on MNOs and
mobile money platform in Kenya, petitioned operating systems raising competition
the Competition Authority of Kenya (CAK) to concerns?
investigate Safaricom for alleged abuse of its
position as the market leader in M-commerce. • What is the impact of these exclusive
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arrangements on pricing? Are the tariffs fair
Airtel Kenya had claimed that Safaricom’s charges and non-discriminative?
for customers to send money to Airtel Money
accounts were double the amount Safaricom • Have all relevant stakeholders in this issue
charged to send money to its own customers. been identified and consulted widely for input?
Airtel Kenya also wanted Safaricom to allow
M-Pesa agents to deal with other agents like Answers to these questions will guide appropriate
Yu money, Airtel money and Mobikash. In a regulatory interventions to avoid entrenching
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demonstration of regulation in a multi-sectoral anti-competitive market features. Particularly
space (and of regulatory forbearance), the CAK important are considerations of pricing, as the
deferred the issue to the Central Bank of Kenya cost of sending a text message or purchasing an
(CBK) Communications Authority of Kenya (CA). app ultimately will determine the affordability and
access to the m-service or app. Regulators must
In July 2014, the CA ordered Safaricom to allow its ensure that the interconnection framework is
mobile money agents to also operate with other clearly defined and that interconnection charges
platforms. The CA further recommended that are based on objective, economically sound, and
the CBK handle the petition on M-Pesa tariffs, as solidly substantiated costs.
these were charges for financial services. The
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M-Pesa agency system initially operated within the It is also apparent that in aiming for a robust
Safaricom network only, but now is interoperable competitive environment, the telecommunication
with other networks. construct for competition regulation may be
inadequate. It is incumbent on regulators to set
The scenario just described raises several issues for appropriate safeguards and then to intervene to
regulators to consider when attempting to foster leverage opportunities in the digital ecosystem.
diffusion of m-services and apps. It indicates that Introduction of number portability, interoperability
assessment of competition concerns in the digital and infrastructure-sharing are other mechanisms
economy requires an in-depth investigation to that could also be considered. These safeguards
evaluate the “pain point” being raised. It is clear will be discussed later in this chapter.
that a restrictive arrangement does arise when an
m-service is locked into an MNO or when an app is
locked into a single operating system. This has the 5.3.4 Stimulating demand – universal access
potential to raise competition concerns. The lock-
in effect has spurred discussions about platform The network reach and intelligence to support
agnosticism and the creation of open mobile apps. access to m-services and apps remains on the
This related to a desire to see free sharing of apps regulator’s radar now, more than ever before.
on the mass market, in order to achieve critical The urgency to bridge access gaps compels new
development goals in fields such as m-learning, ideas and creativity in order to identify optimal
strategies for achievement of universal service.

132 Trends in Telecommunication Reform 2016