"Kenya Telecommunications Report Q3 2013" Published

From: Fast Market Research, Inc.
Published: Fri May 03 2013

Growth in Kenya's telecoms market is largely driven by the sector. However, this is threatened by the weak financial performances by most of the operators on the back of declining revenues and rising operating costs. We believe that mobile operators will need to implement new revenue growth and efficiency improvement strategies in order to maintain competitiveness in the market. There already efforts to diversify revenue streams through value-added services and we expect this to be complemented by cost reduction strategies, including outsourcing and managed services. Meanwhile, we expect the decline of the fixed-line segment to continue, although this will be tempered by rising demand for broadband services.

Key Data

* Kenya's mobile market grew by 11.1% in 2012 to bring the penetration rate to 73%.
* Mobile ARPU appreciated by 7.8% in 2012, a sign that the price war may be waning.
* The fixed-line sector contracted by 17.3% in 2012, considerably more than previously expected.
* The number of internet users in Kenya increased by 23.4% in 2012 to around 32.3% of the population.

Full Report Details at
- http://www.fastmr.com/prod/589176_kenya_telecommunications_report_q3_2013.aspx?afid=303

Risk/Reward Ratings

Kenya is ranked 11th on BMI's Q313 Sub-Saharan Africa telecoms Risk/Reward ratings. The country scores above average in three out of the four categories on our ratings table. Kenya's mobile telecoms market is one of the most dynamic in the region, but is held back by low ARPUs in the mobile sector and limited network coverage in the fixed-line sector. On the macroeconomic front, the smooth passage of the country's presidential election in March 2013 bodes well for stability, economic growth and investor confidence. BMI will closely monitor the regulatory environment under the new government considering the impact of the previous government's interferences on the country's Industry Risk perception.

Key Trends & Developments

Safaricom increased the tariffs on its M-Pesa mobile banking service as of February 8 2013, due to a new tax by the government as it looks to improve its fiscal position. The Ministry of Finance imposed a 10% excise duty as part of the Finance Bill 2012, targeting money transfers and affecting all other mobile operators with m-commerce services, as well as financial institutions and money transfer agencies. Declining margins in the industry due to a damaging price war mean that operators have not been able to absorb additional costs.

In February 2013, Essar Telecom Kenya (ETK), which operates under the yuMobilebrand, has been given a Sh13.05bn (US$150mn) capital injection from its India-based parent company, Essar Group, to pay its bank loans. It also received a US$100mn loan in March from an international bank to be used for capital expenditure.

About Fast Market Research

Fast Market Research is an online aggregator and distributor of market research and business information. We represent the world's top research publishers and analysts and provide quick and easy access to the best competitive intelligence available.

For more information about these or related research reports, please visit our website at http://www.fastmr.com or call us at 1.800.844.8156.

You may also be interested in these related reports:

- Greece Telecommunications Report Q3 2013
- Philippines Telecommunications Report Q3 2013
- Turkey Telecommunications Report Q3 2013
- Singapore Telecommunications Report Q2 2013
- Vietnam Telecommunications Report Q2 2013

Company: Fast Market Research, Inc.
Contact Name: Bill Thompson
Contact Email: press@fastmr.com
Contact Phone: 1-413-485-7001

Visit website »