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Friday, July 30, 2010


Reclusive Kenyan billionaire Paul Ndung'u (left in the picture) came to the limelight this week still protesting that he doesn't like people to know him.

The man who holds the single largest individual stakes in many listed NSE companies also happens to be founder and chairman of Safaricom's largest dealer, Mobicom Ltd. That at least was the case until Mobicom terminated the deal last week.

The move to ditch Safaricom came as a surprise to many but even more astonishing was the announcement that Mobicom would now be dealing for Telkom Orange, the consensus sleeping giant of the Telecom sector.

Just what does Ndung'u and his equally rich partner and MD of Mobicom Joel Kibe see in Telkom?

The simple answer is CAPACITY! More on that later but first ruminate on the size of business that Mobicom will be giving up.

As Safaricom's largest dealer doing just about 10 per cent of its business, Mobicom moved Sh450million monthly or roughly Sh5.5billion in turnover annually.

They had 42 Safaricom shops which in turn fed sub-dealers and agents across the country.

By size they dwarfed Samchi and Capital Real Time, two other well known SafCom dealers.

So why move to Safaricom.

For starters this was a deal three months in the making. It was negotiated not just with Telkom Kenya but with France Telecom.

Secondly, Mobicom stands to have Superdealer status as it is the only among the other 56 Telkopm Dealers that has a national presence. The others are regional and will likely have to deal with Mobicom.

But as Joel Kibe put it, the silver lining is in capacity.

"Telkom has a lot of idle capacity," Kibe said.

Apparently, Mobicom is confident it can sell this capacity and make more money than it was making in Safaricom.

Starting August the company will spend about Sh30million to rebrand all its shops with Orange colours.

It then plans to stock a wide range of products including modems, telecommunication equipment, WiMax radios, CDMA gadgets among others. It will also sell fixed lines to customers.

So this is where matters stand, Mobicom believes it has the footprint to take Telkom's products to places where the latter does not reach. Particularly, it hopes to sell the enormous capacity on TEAMS/Eassy that TKL has as well as on Telkom's terrestrial fiber optic network and the Telkom managed government owned National Optic Fiber Backbone (NOFBI).

Kibe 's parting shot: We could do up to Sh20billion in revenues.

Thursday, July 29, 2010


I first heard it from the inside, that as jostling and positioning continues within the Zain fraternity following the acquisition of the African operations by Bharti Airtel, one fellow who would probably emerge in a stronger position would be Michael Okwiri, currently in charge of communications, Zain-Kenya office.

"This guy went to school in India, that's the first thing," the Zain employee said. "Secondly, he knows how to read a script, if you don't surprise him and tell him these are the questions that will be asked, he will shine."

Ostensibly, Okwiri knows how to make a presentation and without getting into Ervin Goffman's analysis of "Presentation of the Self" suffice it to say that he has impressed the new big cajunas at Parkside to warrant a promotion.

Nairobitech has learnt that Okwiri will now go to head Zain Africa Communications Office putting him in charge of communications in 15 African countries.

Not bad brother. One person who might be left feeling lonely is Rene Meza. These two were thick as thieves and practically ran Zain Kenya together.

As for Meza, let us hope he learns from his sidekick and makes all the right noises to keep his seat.

Wednesday, July 21, 2010


Who is more important? Security Forces secret communication or your mobile internet experience? This is not a theoretical question, it is one that the Communications Commission of Kenya will have to confront soon.

It is emerging that the next step in mobile communication technology, the so-called 4G or Long Term Evolution LTE faces a major hurdle in Kenya. The frequencies at which 4G operates, 2.4GHz - 2.6GHz, are held by Kenya's Armed Forces.

Now that is a problem!

So although Huawei Technologies are ready to deploy the technology for their client Safaricom, they cannot because the frequencies are not available.

I don't see the Army just giving up its frequencies and I wouldn't even want to imagine how much of is tied to these frequencies much in the same way most handsets are only second generation and cannot work with say 3G.

You see, mobile technology is now at what we call third generation 3G stage in Kenya -Safaricom has 3G, Telkom and Zain are rolling it out.

Previously, we were at 1G Analog, then we moved to 2G digital (voice, SMS) where most Kenyans are today. The bulk of mobile phone subscribers have 2G handsets and only now are more and more people on 3G (Multi Media, video etc) enabled handsets.

But there is talk of moving to the next stage, 4G where speeds are seen to be truly blazing.

Which is why the Communications Commission of Kenya needs to step up and reorganize spectrum management in the country.

For example, Safaricom because of the current situation where Armed Forces occupy the frequencies which should be used for 4G had said they would consider using the 2G space to deploy this superior technology.

But the bulk of their subscribers have 2G handsets so they can't do away with 2G or risk cutting them off and it will be sometime before majority of handset makers have affordable 3G handsets.

The situation is further compounded by the fact that the space within our Radio Frequencies that mobile operators have been allocated are similar in size. But Safaricom has 14million subscribers while others have a combined total of less than 5million.

So congestion is all too likely to be an issue. CCK however, needs to come out boldly and say what it is doing about the Spectrum issue and not be a hindrance to development of technology.

Tuesday, July 13, 2010


If you don't know why KCB keeps talking about its new core banking system T24 that it has deployed across its 212 branches in the region, picture this.

Before, you could go to your ATM withdraw all the cash there, then walk into the banking hall and do the same all over again and walk out with double the green you had in your account.

Reason? The bank has been running a separate ATM system from the one running inside the banks.

In fact, the banking platform KCB was using was so inadequate that it could serve a maximum of 99 branches. This means, the additional 100 plus branches had to be connected to these others as some sort of extension office.

To run an ATM system, the bank now had to get a separate platform from the already overstretched banking system and this created the gigantic loophole that I mentioned above.

Reconciliation was not instant. Therefore, transactions on the ATM network would not automatically reflect on the main banking system meaning even if you had cleared your account, you could walk into the banking hall and do an over-the-counter withdrawal without the bank suspecting.

Truth would dawn on them much later.

The versatile T24 system solves that and ensures the bank is on top of every transaction carried out within its system.

It also means you do not have to be attached to one branch, any of the 212 branches of KCB that you walk into, be it Rwanda, Southern Sudan, Zanzibar etc, will act like your local branch.

The bank is now installing new intelligent ATMs and upgrading from KCB Quickserve to Visa Electron.