Ratio Magazine :: The Inside Track to East Africa’s Economies - Kenya: Press Release: Zain Kenya Lowers Charges Across Networks by 60% with New Vuka Tariff

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Kenya: Press Release: Zain Kenya Lowers Charges Across Networks by 60% with New Vuka Tariff

Friday, 26 September 2008

Zain Kenya announced a massive 60% reduction in the tariff for calls across networks. Under the new Vuka Tariff launched today, Zain subscribers will be charged a flat rate of KES8 per minute, inclusive of all taxes, to call any network in Kenya. The KES8 price is quoted per minute but charged per second so that subscribers pay even less if they need to talk for a short period of time.

“We are happy that our subscribers will continue enjoying the most affordable rates in the mobile industry and now when calling to any network in Kenya, 24 hours a day, seven days a week,” said Mr. Rene Meza, Zain Managing Director.

Subscribers on the new Vuka Tariff will also pay a flat rate of Kshs. 3, inclusive of all taxes, to send text messages to any network in Kenya. The new tariff is available to both prepaid and postpaid subscribers. Prepaid subscribers can switch to the new Vuka Tariff, free of charge, by dialing *123*8# while postpaid subscribers can migrate by dialing*128*8#.

The new Vuka Tariff makes Zain the most affordable mobile phone service provider in the country offering the lowest tariff for across-network calls. Last week Telkom Kenya entered the mobile telephony market with the launch of its Orange brand and announced it would be charging KES14 for across-network calls while Safaricom currently charges its subscribers between KES20 and KES30, for calls to other networks, depending on the tariff plan.

“With our new Vuka Tariff Zain customers will pay the lowest price per minute to call any network in Kenya. It is now cheaper to call from Zain to any network in Kenya than from some of our competitors within their own networks,” Mr. Meza said.

Furthermore, Zain subscribers on the Vuka Tariff can also enjoy the benefits of the “Unlimited Talk” package, which allows both prepaid and postpaid subscribers unlimited Zain to Zain calls from 6am to 6pm, Mondays through Sundays, for as low as KES65 per day. To subscribe to the Unlimited Talk package customers have to dial *100#.

“During my three-week-market visit throughout the country I have noticed that some customers and retailers were concerned about the fact that the Unlimited Talk package was just a promotion. The Unlimited Talk package is not a promotion, it is a permanent value proposition that will stay for all our subscribers,” Mr. Meza emphasized.

He added: “Our market share has been growing steadily over the past three months. Currently we are taking over 50% of the new mobile subscribers in this country every month”.

Following the steady growth of the subscriber base, Mr. Meza said that over the next three months, Zain will invest over KES3bn to further enhance the network. “This investment will enhance our status as the leading mobile service provider in terms of network quality and coverage,” he said. Currently, Zain has the widest network reach covering over 85% of the population.

The Managing Director also mentioned that the impact of the Zain brand, which was launched in the country hardly two months ago, has been “phenomenal” making Zain the most visible brand in the country today: “We are encouraged by the fact that we have reached a record level in terms of brand awareness and visibility in less than two months.”

Mr. Meza concluded that Zain will continue introducing new products and services in the market and disclosed that a competitive mobile banking solution was underway.

Background

Zain is a leading emerging markets player in the field of telecommunications aiming to become one of the top ten mobile operators in the world by 2011. Zain was established in 1983 in Kuwait as the region’s first mobile operator. Since 2003, it has grown significantly becoming the fourth largest mobile network in the world in terms of geographic presence with a footprint in 22 countries spread across the Middle East and Africa providing mobile voice and data services to over 50.74 million active customers (as at 30 June 2008).

Zain operates in the following countries: Bahrain, Burkina Faso, Chad, the Republic of the Congo, the Democratic Republic of the Congo, Gabon, Iraq, Jordan, Kenya, Kuwait, Malawi, Madagascar, Niger, Nigeria, Saudi Arabia, Sierra Leone, Sudan, Tanzania, Uganda and Zambia. In Lebanon, the company manages the network on behalf of the government operating as MTC-touch. The company’s mobile operations in Ghana will begin by the end of 2008.

In Kenya, Zain is the second largest mobile operator covering over 80% of the country’s geographical region.

The Zain brand is wholly owned by Mobile Telecommunications Company KSC, which is listed on the Kuwait Stock Exchange (Stock ticker: ZAIN). The company had a market capitalization of over USD27.5bn on 30 June 2008.

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