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The Telecommunications Industry in Kenya
BY Louise Mitchell
Kenya
30 November 2016
R 2 040.00 (ZAR)  
estimated $ 143.91 (USD) *
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The Telecommunications Industry in Kenya


The Information and Communications Technology (ICT) sector was the smallest contributor to Kenya’s GDP of US$59.8bn in 2015, at 0.9%, but has been identified by the government as a key sector to aid rapid economic growth. Since 2013 there has been continuous growth in the number of subscribers, with mobile penetration reaching 89.2%, internet penetration 87.2% and broadband penetration 18.6% in the first quarter of 2016.


Market Dominance


In the Kenyan communications sector the sole fixed-line provider is Telkom Kenya, the semi-privatised national operator, and the mobile arena is dominated by Safaricom with a market share of 65.6%. Industry commentators blame Safaricom’s market dominance for the exit of India’s Essar in 2014 and France's Orange which sold its Kenyan operation in 2015. In an effort to gain market share all current role players have invested in and control some level of network infrastructure. Recent regulatory changes have resulted in mobile operators acquiring internet service providers (ISPs) who provide services that include broadband, business internet, fibre to the premises, local area networks, and satellite and VSAT.


Access to Frequency Spectrum


Frequency spectrum is a scarce resource and the management of its allocation impacts the performance of players in the sector. As Kenya currently has no clear policy that facilitates the allocation of spectrum, solving the problems related to spectrum is vital to ensure telecommunications services providers will be able to meet the demands of next-generation systems like 5G mobile.


Report Coverage


The detailed report on Kenya’s Telecommunications sector describes the current market, examines the latest regulatory and corporate developments and discusses factors influencing the success of the sector. As well as profiling the two dominant companies, the report includes profiles for 18 other companies including two smaller players in the mobile sector, Airtel, and Finserve Africa Ltd t/a Equitel.


Page
1. INTRODUCTION 1
2. DESCRIPTION OF THE INDUSTRY 1
2.1. Industry Value Chain 2
2.2. Geographic Position 3
3. SIZE OF THE INDUSTRY 4
4. STATE OF THE INDUSTRY 10
4.1. Local 10
4.1.1. Corporate Actions 16
4.1.2. Regulations 16
4.1.3. Enterprise Development and Social Economic Development 18
4.2. Continental 20
4.3. International 22
5. INFLUENCING FACTORS 24
5.1. Frequency Spectrum Management 24
5.2. Government Initiatives 24
5.3. Infrastructure 25
5.4. Cybercrime and IT Security 26
5.5. Economic Environment 28
5.6. Private Sector Initiatives 29
5.7. Technology, Research and Development (R&D) and Innovation 29
5.8. Environmental Concerns 30
5.9. Labour 31
5.10. Corruption, Political Violence and Terrorism 33
5.11. Electricity Supply Constraints 34
6. COMPETITION 35
6.1. Barriers to Entry 35
7. SWOT ANALYSIS 36
8. OUTLOOK 36
9. INDUSTRY ASSOCIATIONS 37
10. REFERENCES 37
10.1. Publications 37
10.2. Websites 38
APPENDIX 1 40
TESPOK Members as of October 2016 40
COMPANY PROFILES 42
ACCESS KENYA GROUP LTD 42
AIRTEL NETWORKS KENYA LTD 45
EAST AFRICAN MARINES SYSTEMS LTD (THE) 48
EATON TOWERS LTD 50
ERICSSON KENYA LTD 53
FINSERVE AFRICA LTD 54
HUAWEI TECHNOLOGIES INVESTMENT CO LTD 56
INDIGO TELECOM LTD 58
IWAY AFRICA KENYA LTD 59
JAMII TELECOMMUNICATION LTD 61
LIQUID TELECOM KENYA LTD 63
MTN BUSINESS KENYA LTD 65
NEWTELCO SOUTH AFRICA (PTY) LTD 67
SAFARICOM LTD 69
SEA SUBMARINE COMMUNICATIONS LTD 72
SEMA MOBILE SERVICES LTD 74
TELKOM KENYA LTD 75
VODACOM GROUP LTD 79
WANANCHI GROUP KENYA LTD 83
ZTE (KENYA) LTD 85