Safaricom plans to monetise Customer Location Data

The Business Daily is reporting that Safaricom is looking for suppliers of a location tracking and intelligence tool that will help them map out profiles of their customers based on location and phone usage. Effectively, the article suggests Safaricom wants to monetise this data.

For me, this is crazy news for a couple of reasons:

  1. All these years, haven’t they been doing this, already?
  2. Why would they think of this just now? Especially after Kenya’s Data Protections Laws.
  3. Back to the Alpha Innovation Team – Didn’t they ever think of this?

We are living in times where data is very important. The biggest tech companies know this, and they rely on big data. Because from this large data sets, with good analysis, companies can map out patterns, and trends. These can then help them figure out associations and behaviour which can be very important in how they market products, whom they reach out to, and much much more.

Safaricom essentially collects, and holds a lot of information on their customers. They can know where you are based on your phone calls, or where you withdraw, or paying using your M-Pesa. They know your spending patterns, They know when you’re broke, and when you’re rich. If you use Lipa na M-Pesa they know which companies take most of your money, and what products you may be buying.

Basically with all that data, Safaricom can build a profile of you to help them learn your patterns, advertise better, and build better products for you. Which I have always believed they’re doing already. Blaze by Safaricom is one of such products targeted at people under the age of 26.

What’s crazy is this: they can sell this information to other companies. And data is gold. Many telcos across the world sell this data to third party companies.

According to the Business Daily, in Safaricom’s bid notice they say:

“Safaricom has enjoyed rapid growth since her inception largely driven by the innovation and delivery of new and sophisticated services riding on telephony and data services… Consequently, the evolution of the mobile network and devices has enabled Safaricom to gather information from the connected devices. At the core of any reliably connected device is an accurate location intelligence system.”

Location intelligence systems have existed for a while. There have been simplistic ones meant to solve problems like epidemics. And there have been serious ones made to beat business rivals.

Telecommunication companies around the world with such systems have sold the data they have to different companies from Insurance firms, to Supermarkets.

Initially when Safaricom launched Masoko, I believed their success was guaranteed if they could use their muscle, and data to partner with supermarkets, and to know buying habits of customers. Of course Masoko has now failed, and is now effectively dead – unless they have plans for the future with such a system as this that Safaricom looks to be building.

The crazy thing about Safaricom’s plans is that Kenya just recently passed the Data Protection Act of 2019. Which among much more guarantees citizens of Kenya the following:

  1. Right to know how their data is handled.
  2. Right to ask for the deletion or editing of incorrect data
  3. Right to acknowledge or reject their data being transferred to another service

This law is very clear on data privacy, including stiff penalties for groups that go against it. For example, sharing or offering for sale personal data could land those responsible for storage five-year jail or fines of up to KES. 5 million.

What does this mean for Safaricom’s Location intelligence system? I don’t know. Maybe they have different plans, and we are all speculating. Or how I like to see it: speculating is the right thing to do, because it forces them to give us answers.

If Safaricom wants to sell the vasts amount of data they hold, the companies that will benefit the most locally are Safaricom themselves, Banks like CBA with their M-Shwari loans, and Loop Services, KCB Bank who also have a partnership with M-Pesa. And other companies in the financial sector, and probably already in partnership with Safaricom.

I still believe the Alpha innovation team from Safaricom, that is seemingly now disbanded, would have focused on things like these, rather than building a messaging app. Perhaps their work wouldn’t be open to scrutiny as it is now with the public bid.

1 COMMENT

Leave a Reply

This site uses Akismet to reduce spam. Learn how your comment data is processed.