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Friday 18 June 2021
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France Telecom prepares Kenyan subsidiary for pricing war

Telecommunication giants, France Telecom, which owns maj ority stakes in Telkom Kenya, a virtual fixed line telephony monopoly, has signe d the start of a major pricing war in the country’s fast expanding telecommunicat i on industry.

Telkom Kenya’s Managing Director Dominique Saint-Jean said on Thursday the firm was launching a new corporate image for Telkom Kenya, the original telecommunica t ion operator in the country, as part of efforts to start a new dawn in the techn o logy industry.

France Telecom, added its corporate image, Orange, into Telkom Kenya’s dull gree n corporate image to lighten it up in readiness for its launch of mobile phone s e rvices.

The France Telecom, which owns 51% stake in the incumbent fixed line telecommuni cation player, also announced that it has injected US$82 million into the Kenyan

subsidiary, which had been starved off new cash injections for ages.

“There is an amazing potential for telecoms in Kenya today. While in 2002, Kenya had approximately 300,000 internet users and 0.7 million mobile phone users, th e economic and political environment has allowed for 1.5 million internet users a n d 14 million phone users,” he said.

France Telecoms has operations in 15 African countries. Its entry into the Kenya n market after winning a tender process for the majority stakes in the formerly g overnment-owned entity is expected to usher in a new competitive edge for the in c umbent player.

“This partnership has enabled us to make the levels of investment; that means we can commit to delivering world class services to Kenyans. It has also given us a ccess to industry expertise and a strategic alliance which is helping Telkom Ken y a to achieve even more success,” Saint-Jean told journalists in Nairobi.

He said the changes being implemented in the Kenyan subsidiary were a response t o changes in the marketplace and driven by the needs of consumers.

“We are also changing. The changes Telkom Kenya is embracing are not just cosmet ic, but will have far reaching effects on the kind of innovative services we wil l be rolling out in the next few weeks,” the Telkom chief said.

Telkom Kenya was granted a monopoly to provide international gateway services to all telephony players in Kenya since 1999 and the deal expired in 2005, forcing the firm to style up to tackle industry rigours, which it encountered.

Telkom Kenya is facing Safaricom and Zain, which have expanded their mobile phon e operations across the country in readiness.

The two mobile phone players have also launched data services targeting home use rs. Telkom Kenya’s exclusivity period of providing these services also expired a n d it is being forced to face up to the market conditions.

Saint-Jean said the company was ready to tackle change and had launched the firs t “truly broadband service” in Kenya, while it was continuing to upgrade its fix e d line services.


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