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Kenya not ready for 4G network, analysts say

By - | Published Mon, January 21st 2013 at 00:00, Updated January 20th 2013 at 21:53 GMT +3

By Macharia Kamau

A fourth generation network might not make a business case in Kenya at the moment. It is, however, the future of connectivity and the country might be better of laying the ground work for the mobile network now to be able to reap the benefits of the network in the coming years.

The 4G network – also referred to as Long Term Evolution (LTE) network – offers speeds that are three times faster than 3G network.

It has been touted as the next growth frontier in the global telecommunications industry and deployments of the network are expected to gather momentum this year. Kenya has been planning one such network to be undertaken as a joint venture between an industry consortium and the government.

Analysts at Deloiite East Africa note that the country should first learn from the experiences of other markets before investing in the network. Deloitte’s global office released a report last week – dubbed Technology, Media and Telecommunications (TMT) Predictions 2013 – that said there would an upsurge in the momentum behind LTE mobile networks globally.

Question mark

“The business case for LTE in Kenya might still be a question mark in the short-term. For Kenya, it’s more about preparing the ICT sector to the tremendous potential of the technology, especially in terms of bandwidth and speed, compared to 3G,” said Jean Diop Director Consulting, the Strategic and Operations at Deloitte East Africa.

“We have come a long way in the last four years with 3G and clearly the next step is LTE, which is being considered.  It’s likely to foster the emergence of new competencies, and stimulate product innovation. That will thus contribute to strengthen Kenya ICT entrepreneurship leading position in the region.”

The Ministry of Information and Communication has been planning the roll of the network, and initially said it would be up and running in time for the March 4 elections. The time frame however seems unlikely today. In addition to the limited time, there have been concerns from the industry that the timing is wrong.

Financial consultant

The ministry last month launched a bid to look for a financial consultant that will formulate a public-private partnership framework, which will roll the high speed 4G or long term evolution network.

The Government plans to partner with a consortium of the local mobile phone operators and other network service providers in a public private partnership fashion and the consultant is expected to draw up a financial plan for the partnership between the Government and the private sector. The project is projected to cost Sh42 billion.

Getting ahead of itself

Stephen Mutoro, the secretary general Consumers Federation of Kenya (Cofek) noted that while the country is trying to prove its status as a regional ICT hub, it might be getting ahead of itself, as most consumers may not be ready for the move.

Mutoro also noted that uptake of 3G had been dismal, and urged both the industry and Government should give many consumers that might not be necessarily technology savvy time to make baby steps and progress, otherwise there was a risk of making the digital divide worse.

“We welcome advance in technology but we have to take certain factors into consideration, for instance we are a Third World economy and while 10 per cent of elite consumers might want to go for advanced technology, 90 per cent might be left out. We must take care of those that might be late to migrate to the new technologies,” he said in a phone interview.

“The uptake of 3G has not been to the point where one can say the majority of consumers are enjoying services on the network... the beneficiaries of such a move will be equipment manufacturers and vendors.”

“We recently did a study that showed only one operator has been offering quality services on their 3G network, which shows we still have a long way to go both in service provision and consumer usage of 3G network.”

He added that a 4G network would mean additional costs for ordinary consumers, who would be required to acquire new gadgets — mobile phone handsets, Internet modems and tablets — to get services on the planned network.

Not upgradeable

“The nature of the technology gadgets, especially mobile phones, is that they are not upgradeable. Therefore consumers will have to acquire new 4G-enabled phones, which will be at their cost.”

Operators are split on the need of a 4G network at the moment. A segment feels that the country should first utilise 3G, which offers fairly fast connectivity speeds. However, others feel that 4G is essential for their operations and future growth.





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