Kenya on Friday awarded a long-delayed second national telecommunications (SNO) licence to a consortium led by Dubai-based VTEL, hoping to lower prices and boost competition against the state-owned operator.

VTEL, which has partnerships with local companies and a technical partnership with Palestinian PalTel , won the unified licence that includes fixed-telephony, mobile service, Internet and data.

VTEL bid $169.7 million beating India's state-run Mahanagar Telephone Nigam Ltd and Reliance Consortium which included Swedtel of Sweden as the technical partner. MTNL bid $52.1 million while Reliance put forward a $111 million bid. The three had remained in the race from 13 companies which expressed interest when CCK invited bids in May.

CCK said it would publish its intention to give VTEL the licence and then allow two months for any party to bring objections before the licence is finally granted by late January. The winner is expected to start operating within a year. VTEL said it hoped to quickly roll out next generation network in Kenya, moving on both fixed-line and mobile business.

'Our strategy is convergence. Mobile alone eventually will not survive, fix (fixed line) alone will not survive. We need to put them together,' Nour Atout, VTEL's CEO for Africa told reporters. He said Kenya would be one of VTEL's first operations in Africa but was targeting two or three other countries.