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Economy

Telcos connect remote areas in Sh1.2bn deal

A Safaricom engineer
A Safaricom engineer works at a communication mast in Kwale County. FILE PHOTO | NMG 

Telecommunications firms Safaricom #ticker:SCOM and Telkom have won tenders worth Sh888 million and Sh350 million respectively in a deal with the Communications Authority of Kenya (CA) to build base transceiver stations to boost network connectivity in 78 remote sub-locations across the country.

The CA awarded contracts totalling Sh1.24 billion to the telcos to set up their networks in unserved areas and expand voice services in a bid to improve communication for residents in various parts of Turkana, Wajir, Garissa and Kwale counties.

People living in remote areas of Kilifi, West Pokot, Kajiado, Narok and Bungoma areas are also set to benefit from the partnership.

So far, the project has covered 238,082 people with the State regulator aiming to add 319,298 Kenyans to the country's communication grid.

In total, there are 164 sub-locations in Kenya with zero network coverage.

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Digital divide

The CA manages the Universal Service Fund to which telcos, broadcasters and couriers contribute 0.5 per cent of their annual revenues. It then uses the fund to subsidise projects that bridge the digital divide.

“Now the operators would ordinarily not put their network in these places because economically they are not viable to them but as a government we wanted everybody to stay connected.

We will help them go to areas which they would not ordinarily go but which we want them to go,” said Universal Service Advisory Council (USAC) official Nixon Mageka during a visit made to a Safaricom cell tower in Nakoret, Turkana on Tuesday.

Through the programme, Safaricom won tenders worth Sh888 million that the firm has used to set up 37 of its designated 48 stations.

Telkom’s contract worth Sh350 million has been channelled into setting up 12 of its 14 designated stations.

Airtel did not bid for any of the lots, but the CA said it is in negotiations for the firm’s engagement in the establishment of stations in remaining unserved areas.

Operators say setting up of stations in some areas remains difficult due to adverse weather conditions, insecurity as well as a lack of regulatory approvals from the Kenya Civil Aviation Authority in areas where the stations would interfere with flight routes.

Owned by CA

The stations will be owned by the CA for five years while the telcos will maintain them on behalf of the regulator. After this, ownership will be transferred to the operators.

According to the CA data, the value of voice traffic within and across networks was 14.374 billion in the quarter ending September 2018, a 29.88 per cent increase from similar quarter in 2017.

Turkana county residents have said the project will improve access to security, financial services and internet.

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