South African Internet Firm Steps Up Quest for Data Market

Jevans Nyabiage

29 May 2011

Nairobi — The battle for a share of the local data market is beginning to take shape as revenue from the voice segment falls in an already closed mobile telephony sector.

South African firm MTN landed in Kenya last year with the rebranding of its local subsidiary UUNET to MTN Business Kenya.

Last week, its South African rival Telkom South followed suit merging its subsidiaries – Africa Online, Afsat Communications Ltd and Mweb Africa to form iWayAfrica Ltd.

Telkom SA and MTN – the largest continental telecommunication operators- have been trying to enter the Kenyan mobile telephony market for a long time.

The segment has, however, proved a hard nut to crack.

In 2007, the two giants were among those that bid for a 51 per cent stake in Telkom Kenya but lost to France Telecom, which now runs the Orange mobile brand in Kenya.

Last Thursday, iWayAfrica chief executive Mr Harry Aucamp was wary of Telkom SA entering the Kenyan mobile telephony.

“That will never happen; a lot has changed.

“Our bet in the region is in data as GSM is already saturated. You will realise that even the four operators in Kenya are finding it hard to operate.”

The big pie remains in data which is ripe but not fully exploited.

Mr Aucamp said they will present a five-year strategic plan to the board of directors of Telkom Kenya in September this year.

“With our pan-African footprint, I believe we have the muscle to compete,” he said.

According to Mr Aucamp, iWay Africa has designed a new strategy to reignite business by accelerating connectivity, data centre services growth in the enterprise market and broadening its offering across the ICT value chain to grow earnings.

Satellite Internet has lately been pummelled by undersea fibre optic cables in Kenya.

After the entry of Teams, Seacom and EASSy cables, most companies have reduced dependency on satellite and only turn to it for backup.

iWayAfrica’s end-game in Kenya is the enterprise data and connectivity market.

Although a lot of expectation for cheap Internet came with the landing of the undersea fibre optic cables, this has not been the case.

The cost is still way high for retail consumers.

“We are not surprised that the excitement around fibre in East Africa and other parts of the continent is waning because naturally, we should be using a hybrid of technologies in order to enhance the offering to the customer,” said iWayAfrica chief marketing officer Sibusiso Mngadi.

AllAfrica – All the Time