Kenya’s mobile market has continued to grow steadily, supported by a mobile subscriber base of about 40 million by early 2016. Some market consolidation occurred following the acquisition by Airtel and Safaricom of Essar Telecom’s yuMobile business. While all operators have invested in mobile technologies and infrastructure upgrades to support mobile data services, competition has nevertheless presented challenges to the profitability of network operators, with uneven revenue growth reported in recent years. Orange Group is the principal casualty and is in the process of exiting the market, having sold its entire 70% holding in Telkom Kenya to Helios. By contrast, Safaricom, controlling two-thirds of the subscriber market, has seen very strong growth on the back of its popular M-PESA payment platform. Competitive pressure has also encouraged players to streamline operations, reduce workforces and sell off their tower portfolios.
To encourage the development of LTE services the government has pursued an open-access approach. A number of MVNO licences awarded since 2014 have added to the competitive mix, with Equitel establishing a market share of about 3% by the end of 2015.
M-Tiba mobile health payment platform launched; regulator proposes limit of ten SIM cards per subscriber; Safaricom contracts Nokia Networks to develop LTE-A network, shares capacity on its LTE infrastructure, launches Hello Doctor m-medicine service; Orange Kenya closes CDMA 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; One Network Area initiative expands to include mobile data and mobile money services; handset device market showing stronger growth for 3G and LTE-enabled devices than 2G; government’s open-access approach to licensing LTE network revised; report update includes the regulator’s market data to December 2015, telcos’ operating and financial data to Q4 2015, recent market developments.
Companies mentioned in this report:
Safaricom (Vodafone); Bharti Airtel (formerly Zain, Celtel); Essar Telecom Kenya (yuMobile, formerly Econet); Telkom Kenya (Orange, France Telecom); Huawei Technologies; ZTE; Alcatel-Lucent; Nokia Networks.