New 4G/LTE (Long Term Evolution) Company to Lower Costs in Kenya
The global adoption of Long Term Evolution (LTE) technology is gaining momentum due to its exceptional download and upload speeds. Recognizing the potential benefits and cost reduction opportunities for service providers, the Kenyan government is actively pursuing a public-private partnership to establish an independent platform for LTE technology. This innovative approach aims to eliminate the need for service providers to acquire expensive licenses, as was the case with 3G technology. This initiative reflects the Kenyan Ministry of Information and Communication's acknowledgement of the flaws in the licensing and allocation of 3G spectrum. Despite being granted 3G licenses, most mobile service providers have struggled to roll out the service nationwide.
Safaricom, with its extensive 3G network covering 1,500 base stations out of a total of 2,500 across the country, currently holds the dominant position in Kenya. Orange Telkom Kenya follows with 220 sites. Bharti Airtel Kenya, despite obtaining a 3G license before Orange Telkom, is yet to launch its 3G service, assuring subscribers that it will be available soon. It is evident that the mandatory $15 million 3G license fee has posed financial challenges for mobile service providers. Acquiring the license itself is one aspect, but the subsequent rollout of the service is even more costly. To address these issues and improve internet connectivity, service providers are now turning to LTE infrastructure, also known as 4G, which offers significant advantages over 2G and 3G networks. With its remarkable speed, estimated to be over ten times faster than 3G, LTE technology enables users to download HD movies in minutes instead of hours or even days.
To alleviate costs, the Kenyan government is actively seeking collaboration with the private sector to establish a new company responsible for managing the 4G/LTE spectrum nationwide. This company will be built upon an open access platform, bringing together all service providers and equipment vendors. By consolidating the costs that would have been incurred individually by each of the four providers, this approach offers a more efficient and cost-effective solution. The expenditures associated with 4G/LTE technology include acquiring both active components, responsible for transmitting and receiving signals, and passive components, which handle signal processing. Notably, this arrangement is unique in that it will be the world's first instance where service providers share both active and passive components in delivering their services.
If successfully implemented, the open access concept will benefit both large and small telecommunications companies in Kenya. No longer will they be burdened with the costly process of applying for individual 4G/LTE licenses. Once the 4G/LTE company is established, the primary challenge will revolve around defining management roles. However, certain factors, such as the unavailability of the 2.4GHz spectrum commonly used for LTE globally (as it is currently utilized by the military in Kenya), may pose additional hurdles during the transition period.
Safaricom, with its extensive 3G network covering 1,500 base stations out of a total of 2,500 across the country, currently holds the dominant position in Kenya. Orange Telkom Kenya follows with 220 sites. Bharti Airtel Kenya, despite obtaining a 3G license before Orange Telkom, is yet to launch its 3G service, assuring subscribers that it will be available soon. It is evident that the mandatory $15 million 3G license fee has posed financial challenges for mobile service providers. Acquiring the license itself is one aspect, but the subsequent rollout of the service is even more costly. To address these issues and improve internet connectivity, service providers are now turning to LTE infrastructure, also known as 4G, which offers significant advantages over 2G and 3G networks. With its remarkable speed, estimated to be over ten times faster than 3G, LTE technology enables users to download HD movies in minutes instead of hours or even days.
To alleviate costs, the Kenyan government is actively seeking collaboration with the private sector to establish a new company responsible for managing the 4G/LTE spectrum nationwide. This company will be built upon an open access platform, bringing together all service providers and equipment vendors. By consolidating the costs that would have been incurred individually by each of the four providers, this approach offers a more efficient and cost-effective solution. The expenditures associated with 4G/LTE technology include acquiring both active components, responsible for transmitting and receiving signals, and passive components, which handle signal processing. Notably, this arrangement is unique in that it will be the world's first instance where service providers share both active and passive components in delivering their services.
If successfully implemented, the open access concept will benefit both large and small telecommunications companies in Kenya. No longer will they be burdened with the costly process of applying for individual 4G/LTE licenses. Once the 4G/LTE company is established, the primary challenge will revolve around defining management roles. However, certain factors, such as the unavailability of the 2.4GHz spectrum commonly used for LTE globally (as it is currently utilized by the military in Kenya), may pose additional hurdles during the transition period.
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