Orange intensifies battle for subscribers with Sh2 call rate

Telkom Kenya has given the increasingly vigorous battle for subscribers a fresh impetus with a new two shillings-per-minute-tariff that comes with a seven-hour free call service within its network.

But Orange subscribers wishing to benefit from the service that begins at 10am up to 5pm will have to pay a monthly registration fee of Sh100 that translates to three shillings for the seven hours’ unlimited calls.

Any calls made within the network past these hours will be charged two shillings.

This means that with Sh100 a month, end users and business people can now make calls for seven hours daily within the three platforms, thus saving thousands of shillings.

They will only incur charges to other networks.

The tariff reduction has been triggered by a directive by the industry regulator, the Communications Commission of Kenya (CCK) on a Sh2.21 (interconnection) fees among the operators.

Telkom Kenya chief executive officer Michael Ghossein said the firm will issue its tariffs on the CDMA and fixed networks rates next week as it was still in talks with the Government and the regulator on their termination rates which were lumped together with GSM despite their earlier bid to have them separated.

The company wants the interconnection rates for fixed line and CDMA to be revised upwards from the current Sh1.67

CCK released recently to three shillings, saying the current rates will hurt its business because it is too low to cover running as well as network maintenance costs.

Interconnection fee

The appeal by Telkom Kenya to have the fixed interconnection fees revised upwards is seen as an attempt by the company to market the data segment which is more lucrative since voice market revenues have been diluted by tariffs reductions.

Telkom Kenya plans to revive its landline services to offer data.

This comes at a time when industry operators say the high costs of wireless internet connection is barring home and small office users from tapping into the broadband infrastructure in the country.

“The voice market is dead and Orange is determined to keep leadership in data and value added services,” said Mr Ghossein , adding that the new tariffs also come with additional benefit of free calls to all Orange networks such as Orange Mobile, Orange Wireless and Telkom fixed line.

Orange and Zain Kenya have both announced they will roll out their 3G network before the end of the year.

The rollout of the 3G is expected to stir competition in the sector where only Safaricom is currently offering high speed internet through that technology.

Zain has already starting making preparation for this by forming a new business unit known as Broadband and VAS business unit .

“We are putting together a team of professionals who have vast knowledge of this market and are also well versed with emerging trends in the data sector,” said Mr Rene Meza, Zain’s managing director.

Zain’s has invested in the 10,000 km EASSy submarine cable that has connected East Africa with the rest of the world, while Telkom Kenya’s Orange and Safaricom and Essar Yu have invested in TEAMs, Seacom Eassy cable.

Orange became the third operator to reduce its tariffs in less than a week and will be charging Sh4 for calls made to other networks and Sh1and Sh2 for Short Message Services within and outside the network respectively.