Safaricom taps into Sh7b kitty to expand network in low-served areas

The Communications Authority has commended Safaricom for taking the lead in the utilisation of the Universal Service Fund, as the push to reach underserved parts of the country gains momentum.

This comes as the authority sought more funds to step up its support for national network coverage.

According to the authority, Safaricom has built 30 of the 50 base stations assigned under the Universal Service Fund arrangement, while Telkom is in the process of completing one such station out of the 30 allocated by the regulator.

Bharti Airtel did not bid to build any sites, raising questions about the company’s reluctance to tap into the fund for expansion.

All three telecom operators - Safaricom, Airtel and Telkom Kenya - contribute 0.5 per cent of their annual turnover to the fund, which in turn is managed by the Universal Service Advisory Council.

The authority also contributes 25 per cent of it surplus revenue to the fund.

The authority will spend Sh1.73 billion in the 2018/19 financial year to expand mobile network and Internet service to remote and sparsely populated parts of the country.

This will be in addition to Sh1.24 billion the regulator is spending this financial year.

Broadband Internet

An additional Sh1.6 billion will be spent on taking broadband Internet to schools, bringing the total cash to be spent under the Universal Fun in 2017-2019 to Sh7.17 billion.

The least covered parts of the country consist of 78 sub-locations, which were identified in a 2016 study on the gaps in access to telecom services. Most of them are located in the northern parts of the country, which is sparsely populated.

The Universal Service levy became effective in 2013 anchored on the Kenya Communications (Amendment) Act, 2009. At the beginning of this year, the authority said Sh7.1 billion had been collected for the kitty.

While Internet penetration and ICT use has grown fast in Kenya, swathes of the country are still outside of mobile and Internet reach mainly because they are sparsely populated and would, therefore, not bring in the commercially viable revenues.