Kenya - Mobile Market - Insights, Statistics and Forecasts
Strong growth in the number of mobile subscribers has translated into sustained revenue in the sector. Network operators have consistently invested about a quarter of revenue into network upgrades in recent years. Market consolidation is expected in 2015 following the regulator's approval for Airtel and Safaricom to acquire Essar Telecom's yuMobile business. Competition has also presented challenges to the profitability of network operators, forcing them to streamline and develop new revenue streams in an environment of falling average revenue per user (ARPU) in the voice market. Third generation (3G) mobile broadband services as well as the very successful mobile payment and mobile banking platforms are delivering these additional revenues, but all service segments are highly competitive. In mid-2014 the regulator compelled Safaricom to open up its popular M-Pesa platform to rival networks. For fourth generation (4G/LTE) technology, the government has followed a unique open-access approach with plans to licence a multi-facetted consortium to operate the network, but this has met with resistance from network operators, with Safaricom pulling out in late 2013. Additional MVNO licences awarded in early 2014 have added to the competitive mix.
Safaricom contracts Nokia Networks to develop LTE-A network; Safaricom and Bharti Airtel acquire Essar Telecom's assets and subscribers; Dubai Bank Kenya partners with Rapid Communications to develop the M-SASA mobile banking platform; Safaricom begins to deploy LTE networks in key cities, signs deal with MoneyGram to enable international remittances into M-Pesa accounts; Viettel withdraws bid to acquire Telecom Kenya from Orange group; One Network Area pilot reducing call charges between countries of the East African Community; Safaricom's M-Pesa network to migrate to a locally hosted infrastructure during 2015; handset device market showing stronger growth for 3G and LTE-enabled devices than 2G; new MVNO licences awarded; government's open-access approach to licensing 4G/LTE network revised; report update includes the regulator's market data to September 2014, telcos' operating and financial data to Q3 2014, and recent market developments.
Companies covered in this report:
Safaricom (Vodafone); Bharti Airtel (formerly Zain, Celtel); Essar Telecom Kenya (Yu, formerly Econet); Telkom Kenya (Orange, France Telecom); Huawei Technologies; ZTE; Alcatel-Lucent; Nokia Siemens Networks (NSN).