form the core business model of the operator. OTT services have also competed with and completely
overtaken other business models such as the video/DVD rental business which now effectively have
ceased to exist in its traditional form. OTT services however are one of the main drivers of internet
adoption by consumers. Attempts by network operators to compete back with OTTs by throttling or
blocking OTT services has led to a consumer led debate in many countries on the subject of ‘net
neutrality’ where the consumer demands that OTT services will work well regardless of their choice of
network operator.
OTT services can also bypass territorial regulations such as regulated tariffs, content control, taxes on
services consumed, or encryption services which are invisible to lawful intercept and other regulatory
aspects by being used by consumer, in a jurisdiction that can be far removed from that which the
service is being delivered. Thus, in the countries where the service is consumed, the OTT service
providers may be physically and legally present in a different territory which is not subject to the
regulation.
A net neutrality policy may need to be developed to ensure fair competition between different
content and service providers. However, a blanket open Internet policy could inadvertently undermine
key policy objectives such as the promotion of innovation local content production and universal
service
18.5 Policy Objectives
(a) The policy recognizes that OTTs are largely technologically and legally out of reach of
regulation but promote inclusion of OTTs into the Kenyan economy;
(b) OTT services, both local and global, need to be able to develop in order to promote internet
adoption and to allow locally innovated and hosted OTT services to arise;
(c) Encourage eventual investment and contribution to the local economy by global OTT service
providers;
(d) Encourage local peering, and local content caching partnerships;
(e) Encourage locally regulated telecommunications operators and broadcasters to develop their
business models in order to effectively stay competitive in light of the challenge that OTT
brings to their business models, but with awareness of the emerging issue of net neutrality.
18.6 Mobile Money
Mobile money in Kenya has enabled customers convert cash to and from electronic value (i.e. emoney), as well as use mobile money to perform transfers or make payments. This was borne out of
the need to serve low-income customers profitably, particularly in rural areas.
Government has supported a market led approach to enable the thriving of mobile money services
particularly by mobile money providers. Further, the Government has encouraged digital financial
inclusion amongst Kenyans and this has also contributed to the uptake of Mobile Money services in
Kenya. Digital Financial Inclusion has in turn contributed economic growth, offered convenience and
consumer protection, and has reduced the vulnerability of a country’s financial system by lowering
the risks caused by the informal economy and widespread use of cash.
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