Kenya’s telecommunications market continues to undergo considerable changes in the wake of 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 has struggled to make headway in this market, prompting reorganisation in 2018 which included a sale and leaseback arrangement with its mobile tower portfolio. In early 2020 competition authorities approved the acquisition of Telkom Kenya by Airtel Kenya, with the new merged operator able to provide a greater challenge to the market dominance of Safaricom.
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 increased 53% in 2019, year-on-year. Much of the progress in the broadband segment is due to the government’s revised national broadband strategy, which has been updated with goals through to 2030, and which are largely dependent on mobile broadband platforms based on LTE and 5G.
BuddeComm notes that the outbreak of the Coronavirus in 2020 is having a significant impact on production and supply chains globally. During the coming year the telecoms sector to various degrees is likely to experience a downturn in mobile device production, while it may also be difficult for network operators to manage workflows when maintaining and upgrading existing infrastructure. Overall progress towards 5G may be postponed or slowed down in some countries.
On the consumer side, spending on telecoms services and devices is under pressure from the financial effect of large-scale job losses and the consequent restriction on disposable incomes. However, the crucial nature of telecom services, both for general communication as well as a tool for home-working, will offset such pressures. In many markets the net effect should be a steady though reduced increased in subscriber growth.
Although it is challenging to predict and interpret the long-term impacts of the crisis as it develops, these have been acknowledged in the industry forecasts contained in this report.
The report also covers the responses of the telecom operators as well as government agencies and regulators as they react to the crisis to ensure that citizens can continue to make optimum use of telecom services. This can be reflected in subsidy schemes and the promotion of tele-health and tele-education, among other solutions.
Key developments:
Telkom Kenya and Airtel Kenya secure approvals for their merger;
Alphabet’s Loon balloons finally come into service;
Kenya sees a 35% increase in international bandwidth in 2019;
Universal Service Fund extends mobile coverage to underserved northern regions;
Safaricom launches M-PESA Global payment service;
Government proposes increase in m-money transfer tax;
Regulator introduces a new system to measure QoS parameters;
M-money interoperability starts;
Report update includes the regulator’s market data to December 2019, operator data to Q1 2020, Telecom Maturity Index charts and analyses, assessment of the global impact of COVID-19 on the telecoms sector, recent market developments.
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, Essar Telkom Kenya, Mobile Pay (Tangaza Pesa), Zioncell Kenya, Finserve Africa (Equitel), Kenya Data Networks (KDN), Jamii Telecom, SimbaNet, Africa Online, Access Kenya (Dimension Data), Wananchi Online, Swift Global, Internet Solutions Kenya (InterConnect), Gilat Satellite Networks, Afsat Communications, Inmarsat, Indigo Telecom (Thuraya), Nation TV (NTV)
Key statistics
Regional African Market Comparison
TMI vs GDP
Mobile and mobile broadband
Fixed and mobile broadband
Country overview
COVID-19 and its impact on the telecom sector
Economic considerations and responses
Mobile devices
Subscribers
Infrastructure
Telecommunications market
Market analysis
Regulatory environment
Regulatory authority
Fixed-line developments
Kenya Communications Act 1998
Revised Telecommunications Market Structure 2004
Kenya Communications Amendment Act 2009
Licence fees
Universal Service Fund (USF)
Interconnection
Number portability
Spectrum auctions
Foreign ownership
Telecom sector liberalisation
Privatisation of Telkom
Regional telecom licences
Second national operator (SNO) licensing
International gateway licences
Unified licensing regime
Mobile network developments
Roaming
Mobile Termination Rates (MTRs)
International gateways
Spectrum
Mobile Number Portability (MNP)
Network sharing
Quality of Service (QoS)
SIM card registration
Taxes
Tariff regulation
Mobile market
General statistics
Mobile data
SMS
MMS
Mobile broadband
Mobile infrastructure
5G
4G (LTE)
3G
2G
Other infrastructure developments
Major mobile operators
Mobile market share by operator
Safaricom
Airtel Kenya
Essar Telecom Kenya
Telkom Kenya
Mobile Virtual Network Operators (MVNOs)
Mobile content and applications
Mobile money transfer, m-banking
M-medicine
Handsets
Fixed-line broadband market
Introduction and statistical overview
Internet backbone infrastructure
Broadband statistics
Public internet access locations
Digital Subscriber Line (DSL) networks
Internet Exchange Points (IXP)
Kenya Network Information Centre (KENIC)
National broadband strategy
ISP market
Fibre-to-the-Premises (FttP) networks
Other fixed broadband services
Wireless broadband
Broadband via satellite
Project Loon
Digital economy
E-learning
National research and education network (NREN)
E-commerce
E-government
E-agriculture
Fixed network operators
Telkom Kenya
Wireless Local Loop (WLL)
Liquid Telecom Kenya (KDN)
Jamii Telecom
AccessKenya
Telecommunications infrastructure
Overview of the national telecom network
National Optic Fibre Backbone Infrastructure (NOFBI)
Liquid Telecom
Kenya Power and Lighting Company (KPLC)
Kenya Pipeline Corporation (KPC)
Safaricom
MTN
Fibre infrastructure sharing
Data centres
Smart infrastructure
International infrastructure
Satellite
Terrestrial fibre
Submarine fibre
Appendix – Historic data
Glossary of abbreviations
Related reports
List of Tables
Table 1 – Top Level Country Statistics and Telco Authorities – Kenya – 2020 (e)
Table 2 – Telecom sector revenue in Kenya – 2007 – 2017
Table 3 – Annual mobile number portings – 2013- 2019
Table 4 – Change in the share of mobile voice traffic share by operator – 2014 – 2019
Table 5 – Growth in the number of mobile subscribers and penetration rate in Kenya – 2010 – 2025
Table 6 – Change in the number of prepaid and contract mobile subscribers – 2014- 2019
Table 7 – Change in SMS traffic by quarter – 2012 – 2019
Table 8 – Change in the volume of SMS domestic annual traffic – 2008 – 2019
Table 9 – Change in the number of mobile internet subscribers by provider – 2013 – 2019
Table 10 – Change in the share of mobile data subscribers by provider – 2014 – 2019
Table 11 – Growth in the number of active mobile broadband subscribers – 2010 – 2025
Table 12 – Change in the number of mobile data subscribers – 2015 – 2019