Where did it all begin? What were the first crucial decisions that were made and how did Safaricom grow from a rusty analogue mobile network run by Government-owned Telkom Kenya, to its current status as one of the most valuable and trusted global brands?
The following events occur between 1997 and 2007, capturing details of how the foundations and building blocks of Safaricom were laid and structured, dusted and turned into a ferocious cash dispenser that it has become today. Where it all begun
In the 1990’s, the then state-owned Kenya Posts and Telecommunications Corporation(KPTC) began an intense search for a technical strategic partner, to take over its moribund analogue mobile phone service. This process went on up until May of 2000 when Vodafone Group Plc, a mobile network operator headquartered in Newbury, Berkshire, England, turned up at the scene.
The transnational immediately pumped in a cash injection of US$ 20 million, into an outdated and congested network, which had struck out as a malignant tumour on the foot of a dying parastatal. During this period, the analogue mobile phone service which had just acquired a GSM license and was operating within Nairobi and Eldoret. It had only a paltry 11 base stations in Nairobi and 5 in Mombasa, offering a highly overpriced service to those who could afford it.
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Michael Joseph, a South African with Kenyan and Irish citizenship, who is also current Board Chairman of Kenya Airways turned up. What Michael had inherited and used as his building blocks was a company offering a damn expensive but poor quality service, fraught with a long queues of angry subscribers.
“It was damn expensive to get a mobile phone and use one if you could use it. There was also a low quality customer service with subscribers queuing to pay their bills. Sometimes one got a bill and sometimes not. It was not a very great service. It was almost a service put together on a shoestring, reminisces Michael Joseph.
Michael arrived in Kenya in June 2000, landing in Nairobi with a team of five people from Vodafone, with a mission to resuscitate Safaricom.
“We inherited a very poor network and unhappy subscribers. Our immediate target was how to relaunch this company. We only had US$ 20 million, which Vodafone had originally put into the company,” said Michael.
While it was expected that KPTC was to chip in, all they did was to provide its rusty network and noisy subscribers.
Also acting against Michael was his close competitor, then known as Kencell after rebranding from Celtel. Kencell was already ahead with a freshly awarded second mobile phone operator license, in February of 2000. It was already off the starting blocks and was rearing to launch its service in August of that year.
Michael begun the job of piecing together an outfit, finding all the missing parts, dismantling the entire and putting it back together, all the while with a ferocious competitor breathing down his neck.
“The agreement with Vodafone was that we would take over all the Safaricom employees of about 55 people. In July 55 people came over from Telkom. We then awarded a contract to Siemens for the infrastructure upgrade, setting up the platforms and the pre-paid billing system,” said Michael.
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