Internet vendors in Kenya are locked in a fight for market share amid growing demand as the digital revolution gathers pace.
In the fresh clamour, Internet service providers (ISPs) are deploying a raft of strategies, including tweaking their pricing models to enhance the connectivity experience alongside a stream of other augmentations that align with evolving consumer preferences in a bid to tighten their market grip.
Last week, Liquid Intelligent Technologies announced that it has upgraded its 1,300-kilometre fibre optic cable that connects the Kenyan coast to the Ugandan border at Busia to establish better efficiency and reliable links.
“The improved connectivity provided by this route, complementing our existing routes to the Uganda border, will support critical business sectors across the region, providing reliable, high capacity networks essential for digital transformation and economic development,” said the firm’s East and West Africa chief executive Adil El Youssefi.
Just a day before the communiqué, the Kenya Pipeline Company (KPC) had disclosed that it is in the middle of developing a diversified pricing model for its newly launched fibre-optic business in a move that’s aimed at enticing smaller off-takers who have been largely excluded from the critical infrastructure.
Lower rates
In the new model, tier two and tier three ISPs—which are smaller off-takers serving sub-national and local regions—will pay lower rates for access to the Internet fibre optic cable compared to tier one providers, including big players like Safaricom and Airtel.
In the grand scheme of things, the model is poised to encourage more uptake of the Internet services by smaller providers, especially the tier three ISPs, which have generally shied away from the offering since it was first unveiled in April 2022.
“What we are working on in the background but we cannot yet articulate in detail is a diversified payment model for the different categories of clients,” said KPC general manager for strategy and compliance Zilper Abong’o.
Syokinet, which became the first tier three provider to be onboarded into the KPC network, sees the development as one that will trickle in beneficial impact down to the consumer, with managing director Ian Kasyoki noting that it will mark a turnaround in the delivery of Internet to local customers.
“The diversity that we will bring into the market is what is going to challenge the current pricing for internet services, and also the delivery of internet services,” he said.
Satellite Internet
The crowding of the market has further been compounded by the emergence of satellite Internet service suppliers, especially following the entry of Elon Musk’s Starlink provision in July last year.
As a testament to its market disruption force, Kenya’s telco giant Safaricom wrote to the Communications Authority of Keya (CA) seeking a review of the policy to grant licences to independent satellite Internet providers in what was widely viewed as an attempt at taking on the multinational.
In its petition, the market leader argued that indiscriminate permit approvals to such firms could give rise to illegal connections as well as harmful interference to mobile networks.
The latest data from the industry regulator shows that Safaricom dominates the fixed Internet market with a 37.4 percent market share as of March, with the closest rival, Jamii Telecommunications Limited, trailing at a distant 22.6 percent.
During the first three months of the year, total fixed Internet subscriptions grew 4.9 percent to 1.4 million, up from 1.3 million as of last December, with CA figures indicating that the international Internet bandwidth in the country increased 20 percent to 20,744.34 gigabytes per second (Gbps) during the period.
“This is attributed to the upgrade of the capacity during the reference period. The total utilised undersea bandwidth capacity grew by 1.5 percent to 11,155.154 Gbps, out of which 8,201.334 Gbps were used in the country and 2,953.820 Gbps were sold outside the country,” said CA in its latest sector statistics report.
