Telecommunication companies face renewed pressure to upgrade their infrastructure as the Communications Authority of Kenya (CA) pushed for higher-quality mobile and internet services across the country.
The regulator is reviewing the mobile network operators’ quality of service framework, which is used to gauge compliance, to set a higher service quality threshold of 90 percent compared to the present 80 percent, and introduce new county-level penalties for non-compliance.
Meeting the CA score is critical since telcos breaching requirements on the quality of calls and other service outages as a result of omission on their part, risk a fine of up to 0.2 percent of their revenues, which could run into hundreds of millions of shillings.
Analysts said that the push by CA is likely to turn focus on the infrastructure of telecommunications companies, including cell towers, fibre optic cables and even data centres
.’Service quality is largely linked to infrastructure and telcos will certainly focus on sharpening what they have in order to meet the set standards’ Wilson Oluoch, an independent IT expert said.
The guidelines, published last month, expand the service requirement threshold for mobile internet and mobile broadband services, while at the same time raising penalties for non-compliance. In a departure from previous measures of key performance indicators (KPIs) that placed heavy focus on voice and SMS, internet services will now form close to half of the service domains assessed.
‘End-to-End (E2E) Mobile KPIs measure overall service performance across the network, from radio access to core and external interconnections,’ explains the CA in the proposed guidelines.
‘To ensure the scoring framework reflects user experience, it is proposed that weights are allocated across service domains.’
In the proposed assessment formula, voice and SMS services will be weighted at 50 percent and 5 percent respectively, while Internet services, including 5G, will be weighted at 45 percent.
According to the CA, the increased weighting for internet services ‘captures the dominant role of mobile internet in urban and semi-urban areas, supporting both personal and economic activities.’
Top telcos, including Safaricom and Airtel, have, over the years, stepped up efforts to improve infrastructure amid rising business in voice and data. For example, in the last year, Safaricom reported Sh78 billion in mobile data revenue. This was almost as high as revenue from voice, which stood at Sh82 billion, and came on the back of increased consumer traction across its 4G and 5G networks as more users transitioned from feature phones to smart devices.
According to the firm’s latest financial reports, penetration of 4G+ devices rose 33 percent to 23.4 million last year, while 5G devices saw an increase in adoption by 57 percent, with the number of smartphones rising by 19.4 percent to 27.4 million over the same period of time.
Today, the internet has become the dominant communication platform. Social media platforms like WhatsApp, Facebook, and X, formerly Twitter, have overtaken traditional platforms like SMS as channels for accessing short message services.
Video streaming services such as those provided by YouTube and TikTok account for billions of hours of billable mobile broadband hours for telecommunications service providers.
This has presented an incentive for service providers across the mobile telecommunications industry to invest billions of shillings annually in improving access and quality of service. Last year, Safaricom spent Sh91.3 billion in capital expenditure and increased its fibre optic cable footprint by 7.6 percent to 18,300 kilometres.
With more than 1,700 active base stations, the firm has covered a third of the country with 5G technology.This infrastructure outlay has facilitated the firm to roll out leading digital services, including its M-Pesa Customer and Business Apps and Fuliza, that have drawn billions of shillings in revenues and inspired copycat products from rivals.Airtel has also stepped up spending on infrastructure upgrades.
For example, in May 2022, the World Bank private sector lending arm, the International Finance Corporation (IFC) loaned Airtel Africa $194 million (Sh25.02billion at current exchange rates), targeted at supporting capex requirements for two years in seven of its 14 operating markets/companies, namely Chad, DRC, Kenya, Madagascar, Niger, Congo, and Zambia.
The expenditure included rolling out net telecom sites, including towers and base stations, upgrading existing sites to support 3G/4G or potentially 5G services, and adding carrier bands and sectors for capacity and network upgrades.
It also financed investment in fibre transmission infrastructure, IT systems, and sales networks across the selected markets.
The IFC furthermore gave Airtel another $200million (Sh25.79billion at current exchange rates) loan in 2024, whose capex component was directed towards modernising the telecoms networks in Kenya, Rwanda, and DRC, through purchasing equipment on sites for 4G connectivity.
The new requirements from the CA’s proposed quality of service framework will also serve as a means for the industry regulator to shift the burden of conducting an access gaps study from the taxpayer to the private sector.
Telecommunication service providers will be required to publish their quality of service metrics across all counties on their websites and or with the regulator every quarter. The last time the government carried out an access gaps study was in 2016, and despite assurances that the exercise will be regular, the prohibitive cost and logistics have made carrying out another survey untenable.
The new quality of service framework will provide the Kenyan government, through the telecoms regulator, with data on the service quality of 4G and 5G services provided by leading telecommunications service providers and the gaps that exist. This is important because this information guides strategic business decisions, primarily capital investment in an industry characterised by steep infrastructure spending.
In its latest annual report, Safaricom has maintained that quality of service is one of its strategic objectives alongside enhancing digital transformation, promoting e-government services, and ensuring cybersecurity.
This sentiment has been echoed by other telcos, including Airtel, which affirmed its focus on meeting its service obligations as stipulated by the regulator.
‘Our ability to provide quality of service to our customers and meet quality of service (QoS) requirements depends on the robustness and resilience of our technology stack and ecosystem encompassing hardware, software, products, services, and applications, and our ability to respond appropriately to any disruptions,’ said Airtel Africa while releasing results for the quarter ended June 30, 2024.
‘However, telecommunications networks are subject to the risks of technical failures, aging infrastructure, human error, wilful acts of destruction, or natural disasters.’