Two consortia of five companies have put in bids for 4G spectrum licences in Kenya.
The Communications Authority of Kenya (CA) received the applications in December 2017 and is in the process of evaluating them. The consortia both wish to obtain spectrum in the 700MHz band, which was freed up following Kenya’s transition to digital television, to offer high-speed broadband and mobile services.
The decision to split the bidders into two consortia was taken by the regulator’s board due to the limited available spectrum, with CA director general Francis Wangusi explaining that “if we were to give [spectrum] to one, then the others might cry foul.” The consortia have both been granted their spectrum on a trial basis for one year, with Wangusi noting that “if they are successful, they pay the [licensing fee of] $25 million.”
Kenya’s 700MHz spectrum is split into three blocks, with one allocated to Jamii Telecom last year. The two remaining blocks are off limits to the country’s largest three operators Safaricom, Airtel and Telkom Kenya, since they already hold 800MHz spectrum through which they are offering 4G services. More spectrum bands may be made available in the future.
The ten interested parties have not been officially named, but the CA has identified AccessKenya Group, iWay Africa, Liquid Telecom and Wananchi Group as being among them. These tier-two providers are able to offer mobile services courtesy of the Unified Licensing Framework, but do not yet have the required spectrum.
The consortia can either allocate the spectrum to one of their five members or set up a joint venture to operate the networks on their behalf. If they opt for the former, the selected firm would deploy the network then lease it back to the rest of the members.
Jamii Telecom began offering 4G services in 2017 and has thus far struggled with the scarcity of affordable devices that are compatible with the 700MHz band. The high amount of customers using 2G or 3G devices, along with the heavy investment required for infrastructure, is likely to affect the consortia as they begin to deploy 4G services.