Working Nation…no no no Kenya is not…may be a walking and hold up on Traffic Nation. It is hard to tell the amount of time one needs to move from one point to another due to traffic gridlock. It is estimated that traffic jams cost Kenya more than 50 Million Kenyan shillings in a month.
Ok, now you can relax when caught up in the traffic while travelling in the public matatus. Yes, the matatus are going to be wired at long last. Safaricom today announced their partnership with PSV operators in an initiative that will see passengers access free internet in more than 200 matatu’s and buses by September this year.
A total of 46 PSV vehicles plying the Buruburu, Langata, Rongai, Umoja, Githurai, Dandora, Kiambu and Kenyatta University routes have already been fitted with subsidised Wi-Fi routers in the Kshs.7 million initiative which is part of the Safaricom’s on-going effort to grow its data.
It is understandable that Safaricom wants to grow its Data Revenue. In the last Financial Year, Safaricom recorded 28% growth in Mobile Broadband Data revenue to Ksh.6.31 Billion. At the same time, 30 day active mobile data users grew by 57% to 7.1m . That is now 37% of their customer base. From where I sit, I believe Data is everything going forward, but well, some bloggers still don’t agree with that. Recently we had argument with Tom Makau about the viability of Data as source of Revenue for Telcos in Kenya. His argument is not so much that Data is not the future but the fact that most devices in Kenya still on 2G and therefore investment on 3G or 4G is still not necessary.
From the following graph, Tom’s argument is totally wrong , especially the first one where he is saying that Safaricom has not recouped their investment on 3G network almost four years down the line
Safaricom made Ksh.2.89 from the Mobile Broadband Data Revenue in 2010, Ksh.4.45 Billion in 2011, Ksh.5.22 Billion 2012 and 6.31 Billion in 2013. In the last four years Safaricom made a total of Ksh.18.87 Billion from Mobile Broadband Data. Yes, there is cost in doing all that but the most significant one is the Investment they did in deploying 3G network, which was 25 Million Dollars (Around Ksh.2.22 Billion). Saying that Safaricom has not gained from Deploying 3G network in Kenya to me is not making sense.
So why Matatus WiFi for Safaricom? Safaricom says the move will give customers the opportunity to remain connected to unlimited 3G internet without having to use their existing bundles. From outside you might ask whether Safariocm will gain or lose from this deal. Well, for Safaricom, spending 7 Million, to ensure that Kenyans get hooked up on their mobile data should not be a big deal. Practically, increasing the number of users on their data network at this point makes more sense than trying to make money out of them.
Speaking during the Launch, Safaricom CEO had the following to say:
“Most of our customers use Matatu’s and buses as their preferred mode of transport on a day to day basis. This therefore presents us with a fantastic opportunity to drive home the internet story and make it a way of life among our customers which we believe we will achieve by availing FREE Wi-Fi internet in matatus.”
Collymore further added that that the new initiative is part of an on-going campaign to democratize data. Presently, more than half of Safaricom’s customer base has access to an internet device a result Collymore attributed to the introduction of subsidized smartphones.
But in Kenya, there is always a BUT….
The move is fantastic and already tested by the Modern Coast Bus, doing the Nairobi Mombasa Route. It works well, because of the structure of the bus and seriousness of the journey from Nairobi to Mombasa or the other way around… The but of the Nairobi routes is the number of thieves who would try to snatch the phones from the users when they are stuck on the traffic. Using reasonably good phone on Eastlands routes in a 14 saater Matatu , especially when there is traffic jam is too risky and probably the easiest way to lose a phone. The great thing is, the 14 seater matatus are being phased off. 28 seater matatus are still risky but not to the level of 14 seaters. So if you are using those Buru Buru Matatus…check if you can spot Safaricom WIFI….