Safaricom catches the Jubilee Virus mismanagement cold-6%drop huge for a monster

[gout]

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The effects of virus mismanagement.

For the beast said to contribute 6% of GDP, this is seismic.

[Nefertiti]

Disappointing. I thought data would grow exponentially. Folks are broke but Mpesa trx should skyrocket as covid force cashless economy.

[Nefertiti]

Pundit & hk - I warned you Tusker dwarf is no good for tech transformation. Are they still trying to scale to Ethiopia? The only news-worthy item in the last full year is closure of their Alpha lab.

[RV Pundit]

CBK illegally forced Safaricom to transfer money almost for free; during COVID-19. Kenyans are splitting transactions to below 1K. Mpesa is safaricom cash cow.

Safaricom is solid company.

This is COVID-19 - and to come out with 6% down is GREAT NEWS.

[Nefertiti]

Huh? - folks are sending Mpesa for free?? Safcom as digital leader should be milking covid in-door spend like AT&T and Viacoms here. They all doing better YoY.

CBK illegally forced Safaricom to transfer money almost for free; during COVID-19. Kenyans are splitting transactions to below 1K. Mpesa is safaricom cash cow.

Safaricom is solid company.

This is COVID-19 - and to come out with 6% down is GREAT NEWS.

[RV Pundit]

Safaricom without this - could have grown maybe another 25% as usual.
https://www.businessdailyafrica.com/news/Safaricom-risks-billions-as-CBK-extends-free-M-Pesa-transfers/539546-5582454-10djast/index.html

Huh? - folks are sending Mpesa for free?? Safcom as digital leader should be milking covid in-door spend like AT&T and Viacoms here. They all doing better YoY.

[Nefertiti]

I see. This small disruption... basically they are mpesa company. What will they do as real disruption come?

Safaricom without this - could have grown maybe another 25% as usual.
https://www.businessdailyafrica.com/news/Safaricom-risks-billions-as-CBK-extends-free-M-Pesa-transfers/539546-5582454-10djast/index.html

Huh? - folks are sending Mpesa for free?? Safcom as digital leader should be milking covid in-door spend like AT&T and Viacoms here. They all doing better YoY.

[RV Pundit]

Safaricom is not your mate. This is 12B dollar company with revenues of 3B dollars. Even in US - it would certainly feature - as a big company - maybe top 500 or 100?

I see. This small disruption... basically they are mpesa company. What will they do as real disruption come?

[Nefertiti]

Lol definitely tiny SMB. Paypal is 216B. Alipay 200B. Uber 85B. Snapchat (teen photos) 60B. Stripe (fintech) is 36B. 13B company is the "small" in SMB.

Safaricom is Mpesa mobile pay business - Sim card - soon will be turned upside down by Facebooks. Facebook simcards will be in vogue soon with no roaming charges. Only diversifying into more product lines can save them... Masoko and Little Cab should be big subsidiaries by now otherwise they are doomed. I don't see a bright future for Safcom.

Safaricom is not your mate. This is 12B dollar company with revenues of 3B dollars. Even in US - it would certainly feature - as a big company - maybe top 500 or 100?

I see. This small disruption... basically they are mpesa company. What will they do as real disruption come?

[Nefertiti]

Pundit there are no Fortune 500 companies in Sub Sahara let alone top 100

https://en.wikipedia.org/wiki/Fortune_Global_500

[RV Pundit]

Kenyans need to think globally - but we are thinking regionally.

[hk]

Pundit & hk - I warned you Tusker dwarf is no good for tech transformation. Are they still trying to scale to Ethiopia? The only news-worthy item in the last full year is closure of their Alpha lab.

Yes you were skeptical of the keg guy to drive up growth.  However the guy just took over April 1st 2020, not to say that he'll do a great going forward though. Safaricom key profit and revenue driver is Mpesa, once that  was adversely affect the revenue growth stalled. Data growth should have made up for loss in Mpesa revenue. Safaricom needs to borrow a page from Jio of india, offer cheap mobile data. This should have been a growth driver. Safaricom hasn't innovated since advent of Mpesa. Safaricom Mpesa risks being commoditized by a super app e.g what paypal,square did to visa,mastercard and bank accounts.

[KenyanPlato]

Mpesa will die a technology soon. Then what?

[gout]

The beast inafuliza

Safaricom  borrowed additional short-term bank loans amounting to Sh24.7 billion in the half year ended September

This marks the largest borrowing by the cash-rich firm which had in recent years become almost debt-free as it made enough money to fund its operations and pay dividends.

The renewed borrowing appetite was driven by an early dividend payment besides increased investment in its mobile and financial service M-Pesa infrastructure.

https://www.businessdailyafrica.com/bd/corporate/companies/safaricom-taps-sh24bn-loans-as-virus-cuts-profit-3016864

[Nefertiti]

Pundit & hk - I warned you Tusker dwarf is no good for tech transformation. Are they still trying to scale to Ethiopia? The only news-worthy item in the last full year is closure of their Alpha lab.

Yes you were skeptical of the keg guy to drive up growth.  However the guy just took over April 1st 2020, not to say that he'll do a great going forward though. Safaricom key profit and revenue driver is Mpesa, once that  was adversely affect the revenue growth stalled. Data growth should have made up for loss in Mpesa revenue. Safaricom needs to borrow a page from Jio of india, offer cheap mobile data. This should have been a growth driver. Safaricom hasn't innovated since advent of Mpesa. Safaricom Mpesa risks being commoditized by a super app e.g what paypal,square did to visa,mastercard and bank accounts.

You are very right Mpesa is merely shielded by antiquated mast network - will shorty be disrupted by satellite. It was easy to conceive as early as IPO that as "top company" there was no way Safcom head of network - analog masts powered by generators - could double as head of innovation. They opened Alpha lab 10 years late but was built on quicksand without any real autonomy. I guess when Bob poofed they pushed out the iHub mhindi from IBM - forgot his name - who was Alpha manager. Corporate politics can be brutal.

I believe MJ did well partly for his tech chops - engineering background - seen less, felt more. Innovation was key for MJ. Bob was expert marketer who milked Mpesa dry with gazillion till numbers. But his Masoko, LittleCab, Digifarms, cloud - stood zero chance against AWS, Jumia, Uber. Bob was no innovator... which he prolly knew but hired yet another salesgirl from Pfizer to lead innovation. This Ndegwa is also sales guru but it wrong season for that. Now he need to look around real fast & furious for a solid R&D Leader - pay arm-&-leg or anything - and let them do their thing with his full backing. The dwarf is onto something with his going tech vision - but still basically phone-VAS business on a very short leash.

[RV Pundit]

Mpesa is not the tech. It's 250,000 network of Mpesa agents in every little harmlet.You can have all the fancy facebook money - but if you cannot use as ubiquitously as Mpesa in kenya it's not gonna work.

Mpesa now is matured product - no need to tinker it - just improve on it - and fight to replace cash. A lot of people still do useless cash transaction to mpesa - when they can pay money digitially.

Safaricom will make more money when they discourage this cash to mpesa or mpesa to cash.

They need to focus on growing annualy transactions from say 2 billion to say 5billion...which I belive is close to where VISA/MasterCard are - already MPESA is one of world busiest payment system.

More digital transactions - more money for Safaricom.

Kill the cash.Kill cash agent. Quadriple transactions. All the cash money movement is crucial critical data people "die for". This is data Safaricom will have - and they can sell it or push more products.

And once that is one - well Mpesa advantage also go away - everyone can therefore compete on digital money.

[RV Pundit]

Opps - master card does nearly 100B transaction annually. Safaricom is at 3-4B now. This volume of transactions. I think Safaricom can hit 10B easily.

Look like M-pesa Africa - is at 12B.

[Nefertiti]

Mpesa is not the tech. It's 250,000 network of Mpesa agents in every little harmlet.You can have all the fancy facebook money - but if you cannot use as ubiquitously as Mpesa in kenya it's not gonna work.

Mpesa now is matured product - no need to tinker it - just improve on it - and fight to replace cash. A lot of people still do useless cash transaction to mpesa - when they can pay money digitially.

Safaricom will make more money when they discourage this cash to mpesa or mpesa to cash.

They need to focus on growing annualy transactions from say 2 billion to say 5billion...which I belive is close to where VISA/MasterCard are - already MPESA is one of world busiest payment system.

More digital transactions - more money for Safaricom.

Kill the cash.Kill cash agent. Quadriple transactions. All the cash money movement is crucial critical data people "die for". This is data Safaricom will have - and they can sell it or push more products.

And once that is one - well Mpesa advantage also go away - everyone can therefore compete on digital money.

Yes. Ubiquitous Mpesa is shielded by mast network which stop MNC from swooping in. Satellite will kill that - all Visas have invested in satellite big.

Mpesa curve is at inflexion as growth driver - with less and less punch. Covid would be another PEV moment - if Masoko, etc products were well primed.

[RV Pundit]

Once we get to digital money - then any digital money approved by central bank or accepted - will work. We are still at infacy - mpesa to cash - cash to mpesa - still the game - and here the money agents are king of the system.

Now m-commerce - so whoever owns the phone - SIM card - will own the digital space. Of course whoever also own facebook and such social platform - will also own the space.

Infrastructure is low level and irrelevant. What is relevant is having SIM card with my personal information authenticated by Safaricom or my facebook account. Safaricom is more trust worthy because they check my ID. Regulators will have a problem with Facebook and others.

Yes. Ubiquitous Mpesa is shielded by mast network which stop MNC from swooping in. Satellite will kill that - all Visas have invested in satellite big.

Mpesa curve is at inflexion as growth driver - with less and less punch. Covid would be another PEV moment - if Masoko, etc products were well primed.

[Nefertiti]

Once satellite scale - cheap satellite phone - everyone will have Facebook or Visa simcard. That leave Safcom with only agency advantage which going cashless erode. That the real risk Safcom faces. FB or etc simcard will also use ID verification. Safcom long beat incompetent Telkom or Airtels - real challenge is MNCs - who have run circles on cloud (Amazon, Google), streaming (Netflix, Amazon), e-commerce (Uber, Jumia), shared services (Uber, Taxify). Digital economy pie is already sliced except payment - Mpesa - cause physical network.

I see this as innovation weakness. While marketing or monetization is well covered with the vast agent network. They need more products or revenue streams which only innovation can give. Mpesa should scale the usd 10B obviously - gobble the bankers lunch - and use the cashflow wisely while it lasts.

Once we get to digital money - then any digital money approved by central bank or accepted - will work. We are still at infacy - mpesa to cash - cash to mpesa - still the game - and here the money agents are king of the system.

Now m-commerce - so whoever owns the phone - SIM card - will own the digital space. Of course whoever also own facebook and such social platform - will also own the space.

Infrastructure is low level and irrelevant. What is relevant is having SIM card with my personal information authenticated by Safaricom or my facebook account. Safaricom is more trust worthy because they check my ID. Regulators will have a problem with Facebook and others.

Yes. Ubiquitous Mpesa is shielded by mast network which stop MNC from swooping in. Satellite will kill that - all Visas have invested in satellite big.

Mpesa curve is at inflexion as growth driver - with less and less punch. Covid would be another PEV moment - if Masoko, etc products were well primed.