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March 17, 2009

Report: Kenya's Telecom Market to Grow 95 Percent over the Next Five Years

Saying Kenya’s mobile market will see stiff competition among network operators, Pyramid Research reportedly has released a new report, claiming the African nation’s telecom market will grow by 95 percent over the next five years.

As in any market, the introduction of new players in the Kenyan mobile market has created strong competition. While Safaricom and Zain alone ruled the market until very recently, new companies such as Econet and Orange now are penetrating the Kenyan market successfully. This has forced the operators to cut tariffs and introduce new air time promotions.
In its report, “Communications Markets in Kenya,” Pyramid Research provides a profile of the country’s converged telecommunications, media, and technology sectors. In addition to focusing on the introduction and spread of new technologies such as WiMAX, IPTV (News - Alert) and VoIP in Kenya, the report also extensive analysis of both the fixed and mobile sectors, tracks the market shares of technologies and services.
“Kenya shows impressive growth rates with significant opportunity,” said Dearbhla McHenry, analyst at Pyramid and author of the report. “By the end of 2008, Kenya had more than 15.0 million mobile subscribers, with a mobile penetration rate of 39 percent. The subscriber base is expected to rise to 29.28 million, or 66.7 percent penetration, by year-end 2013.”
Much of Africa’s east coast is expected to get a boost in IP communications capability, TMCnet reports in an interview today, as officials from Tata Communications (News - Alert) take their place as anchor tenant on an undersea fiber-optic cable that’s 9,320 miles long that will connect much of the east African coast.
Partly funded by nations along the coast (the cable itself is about three-quarters African-owned), the Sea Cable System, or “SEACOM (News - Alert),” is worth about $650 million.
SEACOM’s cable has been laid from the edge of the South African waters to Mozambique, as well as in the Red Sea from Egypt towards the coast of Yemen – and a third ship last month was being loaded with the rest of the deepwater cable, which will run from India toward Africa, where the three segments will be joined.
The new report from Pyramid forecasts that total revenue of Kenya’s telecom market will grow by 42 percent from $1.39 billion in 2008 to $1.98 billion by 2013. Among these, 78 percent of the total revenue to be generated by the mobile sector; says the report.
Recently, Pyramid Research – as TMCnet reported – predicted that Nigeria has now outpaced South Africa as the largest mobile telecom market in Africa. According to the research firm, Nigeria will retain its growth rate in mobile subscription over the next five years, triggering more intense competition among a growing array of network operators.

Don’t forget to check out TMCnet’s White Paper Library, which provides a selection of in-depth information on relevant topics affecting the IP Communications industry. The library offers white papers, case studies and other documents which are free to registered users.

Raju Shanbhag is a contributing editor for TMCnet. To read more of Raju’s articles, please visit his columnist page.

Edited by Michael Dinan


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