Telkom launches CDMA-based Internet service

Mr Jean-Michel Chanut, Head of Marketing and Strategy at Telkom Kenya said he hoped the product would change Internet standards across the widest coverage area in Kenya, even as analysts questioned the firm’s choice of CDMA in a market that has embraced the more commonly used Global System for Mobile communication (GSM) technology.

Telkom Kenya currently offers telephony and data offerings using three different technologies. Its fixed line, or Orange Fixed service, is the oldest product in its stable, and has over 300,000 customers who access the service through a landline or physical cable into their home or office.

It’s fixed wireless service - marketed under the brand Orange Fixed Plus - is based on CDMA technology and allows users to access telephony and Internet products using a wireless connection.

It is under this platform, launched three years ago, that Telkom Kenya hopes to increase its market share using its revamped Internet service, targeting the 450,000 subscribers already on the network.

The company also offers services on the GSM platform used by Safaricom, Zain and Essar.

Telkom Kenya launched services under its Orange Mobile GSM product line last year and already has one million subscribers on that network.

The firm anticipates the launch of Orange Internet Everywhere 3G will provide users with a simple, reliable and easy to use Internet connection for travel, at home and leisure use.

To access services on Internet Everywhere, subscribers will pay among the lowest rates for Internet connectivity in Kenya, with one megabyte (MB) costing just Sh1.90 to download.

Telkom Kenya said Internet Everywhere 3G is one of the channels Orange is set to use to target a wider broadband subscriber base before it connects to the TEAMS cable later this quarter.

Depressed performance
Meanwhile, France Telecom, the global communications giant that owns a 40 per cent stake in Telkom Kenya, recorded a depressed performance in its results for the first half of 2009.

Although the company managed to record a 6.6 per cent year on year increase in total number of customers - rising from 125.5 million customers last year to the current 186 million - France Telecom’s revenues fell by 0.5 per cent to 25.5 billion euros for the first half of 2009.

France Telecom Chairman and Chief Executive Officer Didier Lombard termed the performance resilient considering the operational environment of the last year.

“In an economic environment that deteriorated more than expected over the course of the first half of 2009, the level of revenues reflects the strong resilience of our business compared to Gross Domestic Product (GDP).

Operating profitability improved in the second quarter, and first half 2009 organic cash flow, standing at 4.1 billion euros, is ahead of the seasonal level achieved in 2008, reassuring us of our ability to achieve our objective of 8 billion euros for the 2009 financial year,” said Mr Lombard.

Mr Lombard said cost saving and transformation plans implemented under the company’s strategic plan dubbed Orange 2012 had helped mitigate the impact of the global economic slowdown.

“With the economic environment remaining difficult in the second half of the year, the Group will continue with targeted marketing programs and cost reduction efforts,” said Mr Lombard.

Acquiring assets
Separately, France Telecom indicated it could be interested in purchasing some of Zain Africa’s assets, saying it would be interested in buying separate units of the operation as opposed to the entire 16 country grouping.

Zain Africa - which includes local operation Zain Kenya - has been in the news following reports that its parent company was interested in selling part or all of its operations.