Airtel has announced it will host three Mobile Virtual Network Operators, (MVNOs) on unused capacity on its network, ensuring that it maintains seamless quality experience to consumers.Airtel is delighted at the move as a mobile operator that is pioneering this innovation in the Kenyan Telecoms Industry.
This announcement comes just days after the Communications Authority of Kenya, (CAK) on Friday 14th April 2014 licensed Equity Bank, through its subsidiary Finserve Africa Limited, Zioncell Kenya Limited, a technology company that provides mobile value added services to mobile network operators, and Mobile Pay Limited which runs the Tangaza mobile money transfer service to operate as the first MVNOs in Kenya.
According to Mr. Wangusi, all three MNVOs will not own a spectrum license or need to put up their own infrastructure, but that they will utilize the installed excess capacity on the Airtel Kenya network with which they already have agreements.
“As you are aware, spectrum for building mobile network infrastructure is limited and we are therefore unable to accommodate many mobile network operators (MNOs). At the same time the cost of building a mobile cellular network is high and few entities have the capacity to invest in such infrastructure,” Mr. Wangusi said.
The companies have been awarded the MVNO licenses under the ‘Application Service Provider (ASP)’ category of the CAK’s Unified Licensing Framework adopted in 2008. Telecom and non-telecom companies as observed from the three licensees can now leverage their existing brand assets and equity to enter the mobile industry and create value. The 3 will compete Airtel, Orange and Safaricom for customers, SIM cards issuance, billing and customer care to end users.
The CAK has developed guidelines that will generally act as safeguards to the end users in terms of quality of service. The MVNOs are obligated to provide services within the set Quality of Service parameters and targets.
In a statement, Airtel Kenya managing director Shivan Bhargava said: “The launch of MVNOs is in line with Airtel Kenya’s innovation and differentiation agenda. We believe that the entry of the MVNOs into the market will stimulate and sustain overall market growth through a new range of innovative products and service propositions that will give more choice and value to Kenyans. Additionally, their entry into the market will increase the uptake of mobile services in key segments such as mobile commerce and data thereby accelerating the inclusion of all Kenyans into the mobile revolution for sustained economic development of the country”.
Others happy with the move include Tangaza Pesa Chairman, Oscar Ikinu who said his firm will venture into voice, Internet, short text messages and mobile money to expand into the market. The company has already produced new SIM cards which it plans to launch in the market soon.
Julian Kyula, the Chief Executive Officer, MoDe, which will operate Zioncell noted that there is still a very good spectrum of value to deliver to Kenyans. “Kenyans and groups such as churches, the youth and farmers look for customized solutions that can serve their unique needs. The smaller companies have the latitude to address these groups more intimately. This is where we come in,” he said.
Equity Bank’s Finserve Africa, perceived as the biggest beneficiary of the initiative is delighted to have received its MVNO license and will be communicating its new services in due course.