KENYAN GOVERNMENT TO OFFER SNO LICENSE IN JULY ON BACK OF INDUSTRY RE-HAUL

Telecoms

The Kenyan government is seeking to auction a license for the country’s second national operator (SNO) in July 2006. The SNO would be awarded a unified license, allowing it to provide fixed line, mobile and international gateway services, as well as operating the wireless loop. This is the second attempt by the government to launch an SNO. In 2004, an auction was carried out, which saw three out of seven initial bidders submit technical documents for evaluation, however, the then minister of information and communication Raphael Tuju, halted the auction, stating that it was flawed.

Meanwhile, the government also announced that mobile operators, Celtel Kenya and Safaricom would be awarded international gateway licenses in the same month. This is expected to not only increase the quality of calls, but also reduce the cost of calls, thereby encouraging further adoption of mobile use, through attractive packages. Moreover, it will also mean that international calls will not have to be re-directed over state-owned telecoms operator Telkom’s network, thereby reducing interconnection charges for both operators.

However, the country’s internet service providers (ISP) came under fire from the Communications Ministry, for failing to take advantage of its offer to equip ISPs with enough bandwidth to provide broadband services, stating that no representatives had come forward over issues related to the sector. The Ministry is keen to see the cost of broadband pricing reduced, alongside the introduction of additional services. These announcements are part of the Kenyan government’s drive to carry out a major re-haul of its telecoms industry, in an attempt to create greater competition in the market.

Business Monitor