MTN Kenya drops partners and lays own fibre cable in Nairobi

Telecoms

MTN Kenya has built its own fibre optic cable within Nairobi, dropping two of its four Internet infrastructure providers.

The firm has been leasing fibre optic capacity from Kenya Data Network (KDN), Telkom Kenya, Jamii Telecoms and Wananchi Group. The company says it installed its own cable because of the poor network quality by some of the providers that was affecting its service delivery.

MTN is the second telecoms operator, after Safaricom, to build its own network and drop some of its providers.

Safaricom terminated a contract with KDN and is currently laying a Ksh14 billion ($165.3 million) inland fibre across Kenya.

Tom Omariba, MTN’s managing director for Kenya said the two remaining Internet infrastructure providers will offer capacity in areas where it is yet to extend its fibre network.

MTN Group is Africa’s largest telecoms operator with more than 130 million cellular subscribers in the region and in the Middle East, and its latest move is seen as an effort to protect its turf from Liquid Telecoms that recently acquired KDN.

“A provider will be retained depending on historical evaluation of quality of service and uptime, it is not a blanket decision,” said Omariba. “We had to build our own fibre cable; we tried to switch providers to see if this could improve the quality of our service to clients, but it didn’t work.”

The cable will provide MTN with a new revenue stream as it will be able to lease the excess capacity to other providers.

Quality of service has become a major customer acquisition and retention factor to operators. In addition, regulator Communication Commission of Kenya (CCK) is seeking heavier penalties against operators who fail to meet the industry’s standards.

CCK fines companies Ksh500,000 ($6,000) for breach of quality of service standards, and the government aims to raise the fine claiming the current penalty is too lenient and ineffective.

“Some of our clients are multinational firms who want the same quality of service they experience in other parts of the world. The only way to guarantee this is to look for a permanent solution,” said Omariba.