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Kenya: Econet Wireless begins rollout

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cellphone.jpgKenya is set to have a third mobile phone operator this August , bring an end to a duopoly enjoyed by Safaricom Limited and Celtel Kenya for years.

The dominance of the two will come to an end when the latest entrant into the market Econet Wireless International (ECI) rolls out it’s network in the country bringing to three the number of operators and ushering in much needed competition .

The entry of ECI into market will also bring in new products experts say, away from the normal voice and data services offered by the pair who have dominated local seen over the past 8 years.

Indications that the firm was ready to take the plunge became clear on Monday this week when it announced senor staff appointments for Kenya operations , with Michael Foley formerly of Celtel Tanzania being named CEO .

Others named include Anna Othoro formerly working for Celtel Kenya and who was appointed marketing director , a pointer to the fact ECI poached heavily from the pan African mobile phone operator.

ECI making it’s first step into the region made the move months ahead of Telkom Kenya which later in the year is set to enter the GSM market , making the field even more crowded but more competitive.

The entry of ECI marks an to 5 years of conflict between the Southernafrica firm and Kenya government over a host of issues ranging from it’s ownership structure to it’s financial and technical capacity to offer GSM service.

The company has been in Kenya since 2003 when it won a bid to commence services in the country but it’s Kenyan partners the Kenya National Federation of Cooperatives (KNFC) failed to raise part of it’s financial commitment forcing ECI to take up 41% reseverd for the Kenyan firm.

This resulted in a 2 year long legal battle that ended in 2005 , but the firm again was unable to raise the money on it’s own forcing then information minister Raphael Tuju to cancel.The move was contested by the company which the courts ruled in it’s favour in 2006.

The company payed $100 million license to the government this year allowing it to commence business in the country .
That was not before roping in Indian telecoms firm Essar communications holdings which bought a 49% stake in ECI and injecting in much needed capital , to enable the firm pay for the licence.

The company started recruiting senior staff in April this sending jitters across the 2 Kenyan operators who feared losing top and qualified staff to the new entrant.

As it turned only Celtel the lesser of the pair turned victim with Safaricom the most profitable firm in East and Central Africa retaining it’s senior personnel.

ECI will to fight hard to a get it’s own market segment in a market of an estimated 13 million subscribers with Safaricom having 10.5 million of those, an equivalent of 85% leaving Celtel with a meager 15%.

The anticipated entry of ECI is eagerly awaited by subscribers who are hoping for new products and lower calling tariffs.

Entrenched operators Safaricom and Celtel have been offering reviewing tariffs and carrying out promotions to keep subscribers hooked , a number of whom only used to the pair may be tempted to jump ship.

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