Silent fibre-optic war rages

What you need to know:

  • Underpricing is reflected in a market report by Altech to its stakeholders. The South Africa-based technology company is the majority shareholder of Kenya Data Networks (KDN), a pioneer and major player in the inland cable business
  • The landing of three international submarine fibre-optic cables in Kenya (Seacom, TEAMS, and EASSy), bringing to an end dependence on limited and expensive satellite bandwidth, has revolutionised the country’s Internet and broadband sector
  • The effect has been a huge drop in international Internet bandwidth pricing, with wholesale prices falling by more than 90 per cent, making it a mass market product
  • Companies that started out as mere Internet service providers, such as AccessKenya, Kenya Data Networks, and Wananchi, transformed themselves into second-tier telecom firms by rolling out national and metropolitan fibre backbones
  • Analysts have cited the lack of clear market segmentation, which would set apart wholesalers from retailers, as having a negative impact on the data market, especially on pricing to end users

As the fight for voice revenue hots up among mobile operators, a bigger battle that is likely to shape the face of the telecommunication industry over the next decade is quietly being played out among inland fibre-optic providers.

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