Safaricom ventures into data services

22 Aug 2008

Safaricom has purchased a 51% stake in local internet service provider (ISP) One Communication for USD2.6 million. The acquisition offers Safaricom the technology and platform to deliver a wider range of services including WiMAX access. One Communication has installed five WiMAX base stations in Nairobi and now plans to start rolling out services to small towns in rural areas according to CEO Geoffrey Shimanyula. His Safaricom counterpart Michael Joseph said the acquisition of One Communication will enhance Safaricom’s current broadband services especially for corporate customers, claiming, ‘This acquisition will help us broaden our product offering from just GSM services to internet services’.

At present the Kenyan data market is under utilised, and provides a promising opportunity for operators to offset declines in traditional mobile revenue streams. The penetration rate in the ISP market stands at just 2% of the population. Recently the Communication Commission of Kenya (CCK) initiated unified licensing, whereby operators will have the ability to offer additional services without having to pay an extra licensing fee. Meanwhile, Safaricom’s main rival Telkom Kenya unveiled new data products last week with its Orange rebranding and has reached an agreement with Apple to market the iPhone.

Kenya, Safaricom