Intrigues surround 4G network rollout in Kenya

Safaricom and Airtel would each have paid astronomical sums in an auction for a 4G (Long Term Evolution) license. That is the view of the government. However, after rolling out the infrastructure, the winning company would then have been forced to recoup its investment by overcharging customers to access the network. Because of this, government officials felt that it would defeat the quest for universal and open access to the network.

Instead, a shared infrastructure model, akin to that used to build the country's first submarine fiber cable, TEAMS, will be used. Treasury has already given the go-ahead to a consortium of telecom operators and infratructure equipment suppliers to form a special purpose vehicle that will cover the entire country with LTE vaulting Kenya into the league of 39 nations worldwide that have rolled out the technology.

Safaricom, Airtel, Essar (yu) and Orange will be part of the consortium and will in addition to contributing to the escrow account that will be established for the SPV also provide their base stations for infrastructure sharing. Data carriers, KDN and MTN Business, will also participate in the consortium something that some of the mobile operators have not been happy with.

Alcatel-Lucent, the equipment maker that also manufactured the undersea cables connecting Kenya to the world through TEAMS and Seacom are in the consortium and will likely be chosen to supply and build and the infrastructure. Epesi Communications, which does not seem to be listed anywhere online, and the government of Kenya make up the group.

Unlike in the past when Safaricom acquired a 3G licenses and cashed in on it before the competition could wise up to the benefits of the data technology, this time anyone wishing to buy capacity will be able to do so by leasing from the consortium. There has been disquiet amongst the mobile operators who feel because the 4G technology also supports voice, data carriers like KDN and MTN will be able to offer this service yet they are not licensed to be telephone operators.

The technology will run on the 800Mhz band where Orange are expected to vacate some space. Initially it had been thought that the 2.30-2.6Ghz frequencies that were held by the military would be used for this technology but studies have shown that they would be too expensive to use. Because they can sustain long distances, these frequencies would require the construction of a lot more masts to place radios yet the 800Mhz can travel long distances.

Another issue also revolved around the two equipment makers, Huawei and ZTE. It was felt that these two had too close a relationship with Safaricom and Orange respectively. Ericsson is also said to be keen to get in on the action. By December, the government expects parts of Kenya to have seen the LTE rollout. No word as to when we can expect 4G devices.