BY PETER MUTAI
NIROBI, Dec. 21 – The Kenyan government has extended deadline by four months for mobile operators to switch off subscribers using counterfeit handsets. A statement from the industry regulator, the Communications Commission of Kenya CCK) said the extension will effectively give the affected subscribers reprieve to replace their handsets before they are disconnected in April 2012.
Acting CCK Director-General Francis Wangusi said the extension was necessitated by the need to first undertake a consumer awareness campaign and also for the industry to establish a mechanism through which consumers could confirm the status of their mobile devices. “ICT sector regulator, the CCK, today announced the extension of the disconnection deadline from the end of this month to April 30 next year,” Wangusi said in a statement released in Nairobi on Wednesday.
Counterfeit phones have gained popularity in the Kenyan market due to their cheap pricing. The Anti Counterfeit Authority has said that the country loses an estimated 3.2 billion shillings yearly through tax evasion and the sale of fake handsets. However, the operators are opposed to the move saying that there are subscribers who may not be aware that the handsets they are using are illegal.
The operators also stand to lose revenues from the directive given by CCK. The move poses a challenge in pushing sales in the telephony market where calling rates have dropped and mobile price wars have affected the profits of major operators already. He said the extension will also allow mobile operators to undertake the requisite technical preparations in readiness for disconnecting counterfeit handsets.
“The extension will provide the affected mobile subscribers with more time to replace their mobile handsets in view of the prevailing hard economic realities in the country,” he said. Wangusi said the industry was exploring the possibility of putting in place a system through which subscribers would be able to interrogate a central database via SMS to verify whether their devices are genuine or not.
The move by CCK to block counterfeit handsets from being used in Kenya is expected to affect more than 3 million people currently believed to be using the handsets. Safaricom, Kenya’s largest telecom operator claims there are nearly 1 million devices with non-recognized IMEI on its network. If the CCK’s move works, it is expected to have a ripple effect in the region with more countries adopting similar measures.
Nokia and Samsung have been hardest hit by counterfeit products in Africa. Most pirates have targeted them because of their brand popularity in the region. Regulatory concern over counterfeit handsets stems from the fact that counterfeit devices deny manufacturers of revenue through counterfeit production of their products.
In addition, use of counterfeit handsets may expose consumers to safety and health risks as the phones may not meet the approved radiation standards. Further, counterfeit devices typically enter markets via unofficial channels thus denying the government of revenue. According to industry statistics, close to 2.4 million mobile phones in the market are counterfeit, representing 9.4 percent of the active mobile devices in the country.
Analysts say the ongoing initiative to rid Kenya of counterfeit mobile phones is driven by CCK in conjunction with industry players, handset manufacturers, and other relevant government agencies including KeBS, Office of the President, Anti-Counterfeit Agency, and the Kenya Revenue Authority. The move will work in support of major phone manufacturers such as Nokia and Samsung who have been affected by the sale of counterfeit phones. The phone manufacturers have said that the sale of counterfeit phones account for between 30 percent and 40 percent of Kenya’s mobile phone handset sales.
All mobile retailers are supposed to register their handsets with the regulator, though only the major players in the market comply with this requirement while others do not register their handsets at all. (Xinhua)