East Africa's largest mobile phone operator Safaricom is hopeful they can continue to boost voice revenue for 2011 through market penetration despite ongoing price wars in the region that have destabilized the industry. According to Safaricom's CEO Bob Collymore, with only around 45 percent of the Kenyan population using mobile phones, there is a market to attack and generate more users. His company said they would spend a sizable investment into developing infrastructure to improve coverage to the nearly 40 million people in Kenya. “There is still more penetration to be got,” said Collymore. “We also have a lot more rural coverage to go chase.” Price wars in the country has led to declining costs of making calls and has seen profit margins dwindle in the country. Through March, Safaricm posted a 13 percent drop in the 12-month profits they earned, leaving analysts wondering of the future of large mobile operators in the country. “It is an important moment for operators to understand where they stand in the market and to look at way so of creating a larger market niche through greater infrastructure and penetration,” said Khalil Jamil, an analyst based in Mombasa. Many operators, including Safaricom, are worried that the government's decision to slash interconnection rates between operators will further reduce profits and limit their ability to invest in building up networks in rural areas. BM
