I have been planning to write an article titled “Orange and Airtel have no idea on how to win against Safaricom”, an article that has since been overtaken by events. The article is no longer relevant mostly because¬†Orange no longer exist, at least not in Kenya. As we all know by now, the French owned mobile operator sold all her shares in Telkom Kenya to Helios Investment Partners. The deal that was finalized early last year saw Telkcom Kenya rebrands from Orange back to Telkom Kenya, setting Telkom Kenya to adopt new strategies to expand her market share in Kenya’s mobile telephony industry.
Before we delve into how Telkcom Kenya’s new strategy to capture the market share that is still under Safaricom’s control, it is important to state why I thought that Orange and Airtel were constantly losing against Safaricom. These two telecos, Orange and Airtel, have been assuming wrongly that cheap products and services would easily lure subscribers from Safaricom to their networks. When Airtel came up with Airtel UnlimiNET, many Safaricom subscribers were excited and bought Airtel lines, but these subscribers were not glued to Airtel as the quality of data services on Airtel’s network remained wanting.
Again in the month of May when Safaricom launched their Flex bundles (check out the article¬†The math, the rigidity, and the stupidity of Safaricom Flex Bundles), Airtel responded by launching Tubonge Bundles that many people thought to be much better compared to Safaricom’s Flex, again trying to drag the telecos back to price wars that we had analysed here and found to be a waste of time. Orange wasn’t left behind when they unveiled their 2 shillings voice call across all networks and the cheaper data offerings e.g. 20GBs for shs 2,999.
Details aside, Telkom Kenya seems to have realized that the only way to take on Safaricom head on is to invest massively in infrastructure. As late as April this year, reports we had been getting were to the effect that Telkcom Kenya (Orange) was planning to launch 4G in Nairobi and a few other towns in Kenya. In early May, few Orange subscribers in Nairobi were able to browse Internet via Orange’s 4G. The first users of Orange’s 4G Internet in Nairobi reported speeds upwards of 50Mbps download and upwards of 20Mbps upload.
During the rebranding press event held yesterday, Telkom Kenya reported that the teleco has already spent over Kshs 5 billion to upgrade the network’s infrastructure. By today and in a span of less than six months, the teleco says that it has upgraded its network to 4G in over 1,100 sites across all major towns in Kenya led by Nairobi, Mombasa, Kisumu, Kericho, Nakuru, and Eldoret.
The next strategy by Telkom Kenya to take on Safaricom is to offer truly competitive Internet services through mobile data dubbed Home Plans. The Home Plans by Telkom Kenya allow subscribers to access three times as much data at similar price points offered by Safaricom. For example, if you were to buy Safaricom one month data for Kshs 3,000, you’d access 12GB of data. With the same amount of money on Telkom Kenya’s Home Plan, you will be able to access 35GBs of data. Typically I am a user of Safaricom’s Kshs 2,000 monthly data that provides only 7.5GBs of data. For the same amount of money after moving to Telkom Kenya, I will be accessing a whooping 20GBs of data. Initially on Orange, the 20GB data was available for Kshs 3,000 per month. Now on Telkom Kenya, my monthly Internet requirement of 9GBs can be easily satisfied with Kshs 1,500 that offers 10GBs of data. On Safaricom, the Kshs 1,500 will give you half the data.
The best of the data offering is the unveiling of unlimited Internet access for Kshs 4,000 per month. This may seem expensive for most people, as unlimited Internet access on fixed Internet by ISPs like Zuku can be as cheap as Kshs 2,000 a month, but the fact that the teleco has to control bandwidth congestion, the price point makes a lot of sense. For those that may find Kshs 4,000 monthly unlimited Internet expensive, Telkom Kenya has the other offers.
The data services have always been cheaper on both Airtel and Orange, but consumers haven’t found a reason to move to the other networks as their Internet were always unreliable. However, with the upgrade of Telkom Kenya’s network to 4G, the frequent down times on Telkom Kenya’s Internet ought to be a thing of the past. This then means that the Safaricom subscribers in major towns who will dare try the Telkom Kenya’s services will hardly find reasons to go back to Safaricom.
Two weeks from today, we will test for you the Telkom Kenya’s 4G and contrast it with Safaricom’s, although Safaricom is already moving to true 4G or what they are calling 4G+.