i)
Stakeholder Impacts associated with Price Caps of Off-net to On-net Tariff
Levels: That there are no significant risk exposures to the licensees associated
with this intervention as the cost for providing a one minute off-net voice service
is lower than that of providing a one minute on-net service and the large on-net to
off-net tariff spread by large operators in the Kenyan market are price distortions
that are negatively affecting competition. In addition, off-net traffic account for
small component of the entire traffic volume as most of the traffic (and therefore
cash flows) is generated from on-net traffic;
j)
SMS Termination Rates: That the negotiated wholesale tariffs for mobile and
fixed SMS services are way above the incremental costs of providing these
services across networks and this limits the scope for passing cost benefits to
consumers through lower retail SMS prices; and,
k)
Impact of Mobile Money Transfers on the Voice Market: That the mobile money
transfer Services differentiates voice services and therefore strengthens and
sustains a ‘’club’’ effect through reduced churn rate primarily because the costs to
non-registered users are very high.
7.
THE DETERMINATION
Having considered all the above factors reviewed during the Network Cost Study and
taking due regard to the mandate of the Commission to, among others, promote the
development of a competitive market in the telecommunications sector in Kenya, the
Commission hereby determines:
7.1.
That all mobile and fixed telecommunication operators in the Republic of Kenya
shall implement the mobile and fixed interconnection rates stipulated in Table 1
below on the effective dates indicated therein;
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