Kenya - Key Statistics, Regulatory and Fixed-Line Telecoms Insights
Kenya's telecommunications market has undergone considerable changes since the landing of four fibre-optic international submarine cables in recent years. The dramatic increase in international bandwidth not only ended the country's dependence on limited and expensive satellite bandwidth, but ensured that the cost of broadband access was made affordable for a large section of the population. Access prices had already fallen significantly following the liberalisation of international gateways and the provision of a national backbone network in 2005, but they have now fallen by more than 90%, enabling cheaper tariffs for telephone calls and broadband services. In parallel, the sector's regulator, the Communications Commission of Kenya (CCK), has mandated price cuts on interconnection tariffs and has implemented a range of regulations aimed at developing further competition.
The country's incumbent fixed-line telco, Telkom Kenya, has revamped its infrastructure and services under the Orange Kenya brand, having benefited from fresh capital from its majority shareholder, the Orange Group. The company has also re-entered the mobile market. In early 2014 Orange Group announced plans to sell its 70% stake in Orange Kenya, though by the end of the year it discussions with the government, which owns the remaining 30% stake, had faltered.
A simplified and converged licensing regime introduced in 2008 has lowered the barriers to market entry and increased competition by allowing operators to offer any kind of service in a technology- and service-neutral regulatory framework. Various competitors are rolling out national and metropolitan fibre backbones and wireless access networks to take the new bandwidth and services to population centres across the country. Several fibre infrastructure sharing agreements have been forged.
Orange Group claims to have lost control of Orange Kenya following failed sale negotiations; merger and acquisition activity continuing among second-tier telcos; mobile operators enter the fibre market; report update includes the regulator's market data to December 2014, operator data to Q4 2014, recent market developments.
Companies mentioned in this report:
Telkom Kenya (Orange, France Telecom); Kenya Data Networks (KDN); Jamii Telecom; Access Kenya (Dimension Data); Kenya Power and Lighting Company (KPLC); Kenya Pipeline Corporation (KPC); Wananchi; Safaricom; Bharti Airtel; MTN; Liquid Telecom.