Quest for numbers, Data becomes Kenya Telco’s key revenue stream

Internet penetration in Kenya grew by 4.4 percent between October and December 2016 to reach 89.8 per cent up from 82.6 per cent during the previous quarter according to the Communications Authority of Kenya (CAK) Telecommunications Sector statistics for Q4’2016.

Further, according to internet world stats, the country has 39,664,377 Internet users as of March, 2017,  with 81.8 percent penetration.

In the CAK report, Internet subscriptions recorded an 11.3 percent growth to 26.6 mn subscribers from 23.9 mn registered in Q4’2015.

Mobile data subscriptions continued to account for the majority of the subscriptions, rising by 3.9 percent to 26.5 mn subscriptions. Consequently, the number of estimated internet users grew by 11.5 percent to 39.6 mn users compared to 35.5 mn users registered in Q4’2015.

Users grew by 5.0 percent q/q from 37.7 mn users in Q3’2016 mainly attributed to long school holidays over which the students subscribed to data services.

The number of internet broadband subscriptions increased by 76.4 percent during the quarter under review to 12.7 mn from 7.2 mn recorded in Q4’2015, attributed to the affordability of smartphones in the country as well as affordable internet bundles offered by various internet service operators. The broadband penetration closed at 28.7 percent, up from 16.8 percent in Q4’2015.

“The telecommunications sector has recorded improved growth in terms of mobile subscriptions and data consumption. Given the rapid population growth and technological advancements, we expect the industry to continue experiencing strong growth,” Cytonn Investments had noted in a weekly Investor brief.

“As technologies develop and become popular, new uses and consumer behaviours emerge. It is expected that the introduction of new generation of network and device technologies will lead to further changes in usage,” according to the CAK report.

The above emerging patterns have not been ignored by the Kenyan telecommunications companies: user patterns have changed too,

CAK released a report on quality standards in Kenya’s telecommunications industry, where Safaricom, Airtel and Telkom Kenya failed to meet the quality standards of voice services, with their overall performance for the year to June 2016 coming in at 50.0%, lower than 62.5% recorded in FY’2014/15, and the regulator’s requirement of an 80.0% score on indicators such as speech quality, completed calls, call success rate and drop rate.

Bob Collymore, Safaricom Chief Executive Officer states that, “Data remains our fastest growing revenue stream and we are focused on growing it further through accelerating smartphone penetration, growing 3G and 4G users, offering relevant content, driving adoption of data bundles and owning the home through our affordable 4G home broadband (theBigbox) and fiber-to-the-home solutions.”

During the launch of the Telkom brand, Aldo Mareuse, the CEO disclosed that they, “Have been on a journey to turn Telkom Kenya into a future fit organization, and to transform it into an innovative and successful Kenyan brand offering a full suite of services that cut across the Telco sector in the country.”

In January, Airtel Kenya while rolling out its 4GE LTE service in the country, it recorded a 2.5 per cent increase in its mobile data/ internet subscriptions to 21.2 per cent, up from 18.7 per cent in the previous quarter according to CAK data.

McKinsey Global Institute report on Digital globalization: The new era of global flows notes that individuals are using global digital platforms to learn, find work, showcase their talent, and build personal networks. “This is a moment for companies to rethink their organizational st