Bloomberg News

France Telecom Kenyan Unit Targets 500,000 Users, CEO Says

February 21, 2012

(Updates with comment in third paragraph.)

Feb. 21 (Bloomberg) -- France Telecom SA’s Kenyan unit plans to add 500,000 users to its network by the end of 2012 and wants the regulator to double rates operators can charge to carry each others’ voice calls, Chief Executive Officer Mickael Ghossein said.

Telkom Kenya is targeting 3.3 million customers, or 11.2 percent market share, from 2.8 million users now, Ghossein told reporters today in the capital, Nairobi. The company wants Kenya’s telecommunications regulator to raise termination rates to 4.42 shillings ($0.05) a minute to help it recover costs, he said.

“It is good to protect the consumer; it is also good to protect the investors,” he said.

In August 2010 the Communications Commission of Kenya halved the rates that operators charge each other to connect phone calls across networks to 2.21 shillings per minute, triggering a round of cuts in call costs by companies.

In June 2011 President Mwai Kibaki ordered a halt to further cuts in the interconnection fees after companies including Safaricom Ltd., East Africa’s biggest mobile-network operator, and Telkom Kenya opposed the reductions on the grounds they were losing money.

The number of people using mobile phones in Kenya rose to 26.5 million in September, up from 25.2 million in June, the Communications Commission of Kenya said last month.

Safaricom maintained its lead with a 68 percent share of the market. It was followed by Airtel Networks Kenya Ltd., controlled by Delhi-based Bharti Airtel Ltd., with 16 percent.

Telkom added 16,683 new customers and has a market share of 10 percent, while Essar Telecom Kenya Ltd., a unit of Essar Group of India, had 46,742 new customers, giving it 6.2 percent of the market, the report said without providing data for the previous quarter.

--Editors: Ana Monteiro, Alastair Reed

To contact the reporter on this story: Eric Ombok in Nairobi at eombok@bloomberg.net.

To contact the editor responsible for this story: Shaji Mathew at shajimathew@bloomberg.net


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