Competition stiffens as telecom firms enter ISPs’ turf
Safaricom House. Safaricom has sealed an agreement with Jamii Telecommunications Ltd to use their expertise and infrastructure to offer internet connection to end users.
A battle is in the offing in the Internet service provision sector as big telecom firms position themselves to capture a market previously dominated by the Internet Service Providers (ISPs).
Deal sealed Last week Safaricom and Kenya Data Network, announced that they are making preparation to move into the segment.
Their moves are informed by a number of developments changing the telecoms landscape, ranging from the regulation, competition and improved infrastructure in the country.
Last Thursday, KDN, a data communication carrier sealed a deal with Alcatel-Lucent to upgrade its broadband network.
Come Friday, Safaricom sealed an agreement with Jamii Telecommunications Ltd to use their expertise and infrastructure to offer internet connection to end users.
Unlike, Jamii and KDN, Safaricom has not invested in the fibre optic infrastructure across the country.
The deal will thus give it an opportunity to use Jamii’s resources to be at par with other competitors either eyeing the sector or already in it such as AccessKenya, Wananchi Online and KDN.
The entrants of these players into the provision of internet directly to end users is expected to have an impact on pricing and quality especially to the ISPs who will have to buy bandwidth capacity from them.
Safaricom’s move has been made possible by the new licence regime that now allows providers to offers services not based on a particular technology, but on a number of them.
Neutral licence Safaricom has now formally migrated to the Communications Commission of Kenya’s new technology-neutral, unified licensing regime and can therefore effectively offer a broader spectrum of data services using any technological platform available to it.
Jamii Telecommunications is one of Kenya’s leading broadband infrastructure providers and has laid over 1,000 kilometres of fibre optic cable network in cities such as Nairobi and Mombasa.
Safaricom CEO, Mr Michael Joseph, said the firm opted to partner with Jamii due to the design and quality of their network and the fact that this relationship will allow Safaricom to make significant savings on both its operational and capital expenses.
Safaricom expects to realize these savings as it replaces its old transmission network with fibre to exploit the advantages that the Jamii infrastructure gives them in terms of accessing large corporates, homes, small and medium enterprises.
Jamii’s Chairman and CEO, Mr Joshua Chepkwony said his company had made a significant investment in developing its fibre network and expressed confidence that Jamii would be able to comfortably handle Safaricom’s demanding requirements.
Undersea cable The announcement by Safaricom and Jamii of the partnership is being made as the country awaits the coming into commercial service of the East African Marine Systems undersea cable in which the two firms own a 20 per cent and 3.75 per cent stake, respectively.
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