This report provides a comprehensive overview of trends and developments in Kenya’s telecommunications market. The report analyses the fixed-line, mobile and broadband sectors. Subjects include:
Researcher:- Henry Lancaster
Current publication date:- March 2018 (17th Edition)
Kenya’s telecommunications market continues to undergo considerable changes in response to increased competition, improved international connectivity, and rapid developments in the mobile market. The landing of four fibre-optic international submarine cables in recent years dramatically reduced the cost of phone calls and internet access, allowing internet services to be affordable to a far greater proportion of the population. In parallel, the sector’s regulator has reduced interconnection tariffs and implemented a range of regulations aimed at developing further competition.
The incumbent fixed-line telco, Telkom Kenya, which was managed by Orange Group from 2007 until it was sold to Helios in November 2015, has struggled to make headway in the competitive market. Numerous competitors are rolling out national and metropolitan fibre backbone networks and wireless access networks to deliver services to population centres across the country. Several fibre infrastructure sharing agreements have been forged, and as a result the number of fibre broadband connections almost tripled in the year to September 2017.
The mobile market has continued to grow steadily, supported by a mobile subscriber base of about 41 million by early 2018. Some market consolidation occurred following the acquisition by Airtel and Safaricom of Essar Telecom’s yuMobile business. While all network operators have invested in mobile technologies and infrastructure upgrades to support mobile data services, competition has nevertheless presented challenges to their profitability, with uneven revenue growth reported in recent years. However, Safaricom has seen very strong growth on the back of its popular M-PESA payment platform. This market dominance, however, encouraged the government to consider, and later dismiss, recommendations from a 2016 report that Safaricom split off its M-PESA business from its voice and data offerings.
To encourage the development of LTE services the government has pursued an open-access approach. Disputes centered on licence fees delayed the launch of LTE services by MNOs, though they continued to invest in infrastructure and technology upgrades using trial licences.
A number of major WiMAX deployments and FttP rollouts have been undertaken, which have pushed fast broadband connectivity to a greater number of subscribers in urban areas. Nevertheless, the vast majority of broadband subscribers remain on mobile networks.
Companies mentioned in this report:
Telkom Kenya, Jamii Telecom, Access Kenya (Dimension Data), Kenya Power and Lighting Company (KPLC), Kenya Pipeline Corporation (KPC), Wananchi, Safaricom, Bharti Airtel, MTN, Liquid Telecom, Safaricom, Essar Telkom Kenya, Mobile Pay (Tangaza Pesa), Zioncell Kenya, Finserve Africa (Equitel), Kenya Data Networks (KDN), SimbaNet, Africa Online, Swift Global, Internet Solutions Kenya (InterConnect), Gilat Satellite Networks, Afsat Communications, Inmarsat, Indigo Telecom (Thuraya), Nation TV (NTV).