Kenya’s 4 mobile operators to meet stringent CCK terms before renewal of licenses


cck_logoThe country’s four mobile network operators – Safaricom; Airtel Kenya; Orange and Essar’s yuMobile – are going to be subjected to very stringent terms and conditions by the industry regulator CCK before their operating licenses can be renewed.

This is because previously, some of the operators have not been able to meet the Quality of Service (QoS) parameters set by the regulator.

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CCK Director General Francis Wangusi has said that all the four operators would pay the same amount for renewal of their licences for a further term of 10 year to ensure parity and a level playing ground for all service providers in the sector.

According to a press release issued today by the CCK, Safaricom will pay Kshs2.36billion (US$27million) for renewal of its operating licence for a further term of 10 years.

However, CCK announced the renewal of Safaricom’s licence would depend on the operator meeting the set minimum quality of service standards by June 2014. Safaricom’s initial licence term of 15 years is set to expire on 30th June 2014 but has a provision for a possible renewal for a further term of 10 years.

Mr Wangusi said the renewed Safaricom licence would come with a set of new licence terms and conditions negotiated beforehand between the regulator and the mobile operator.

The licence renewal fee of US$27 million is based on the bid price offered for the third GSM mobile licence by the latest entrant to the mobile telecoms market in Kenya -Econet Wireless Kenya Ltd (now Essar Telecom Kenya Ltd).

The DG said that whereas Safaricom has significantly contributed to the economy, developed innovative products and services and met most its licence obligations, the mobile operator has consistently failed to meet the set quality of service standards.

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‘‘We have  considered the fact that whereas Safaricom has met most of its licence obligations, its continued failure to meet the set Quality of Service standards remains a concern that needs to be addressed,’’ said Mr.  Wangusi.

The last CCK Quality of Service (QoS) report – which the performance assessment for cellular mobile networks – for the period covering 2011/2012, notes thus:

“Safaricom registered a low performance of 50.0%. This is against the previous improved performance of 75%. This performance falls far below the required compliance target of 80%. Safaricom did not meet the target in any of the regions assessed. The best performance by Safaricom was in Coast and Eastern at 75% followed by 50% performance in Nairobi and its outskirts. The worst performance was registered in Rift Valley, Central, Western and Nyanza regions where the licensee scored 37.5%.”

The QoS report, which can be found here, further states that even though during the preceding year (2010/2011) none of the operators were compliant, Essar and Telkom were compliant in the current year 2011/2012.

States the QoS report:  “Safaricom and Airtel showed significant weakness in some areas and were deemed overall to be non compliant. All the operators failed to meet the target set for speech quality. The levels of compliance may be related to the number of subscribers a network has and the capacity available on the network to meet the resultant demand. This seems to be the case for Safaricom and Airtel whose compliance levels tend to be erratic in areas where they have the most subscriber activity (Nairobi and Central) leading to poor quality and non-compliance. Safaricom’s overall performance in this period went way below their compliance level the previous year. Airtel has shown a downward trend over the last three years slipping from 87.5% to 75% and finally to 62.5% in 2011/2012. All in all, operators need to step up their efforts as consumers continue to demand better services and as they continue to understand and demand their rights as consumers. It is hoped this will be reflected in the next report.”