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Nowadays, a record number of Kenyans are seeking to go online. The CCK, in its latest report, estimates that there are about 16.5 million internet users in Kenya. In the past, cyber cafes fulfilled this need to be connected but not anymore. For one they are not enough and they are not available all over the country. Secondly, they operate mostly during the day. These days, the convenience that comes with mobile internet makes people prefer it over cyber cafes. It is available at the touch of a button and in parts of the country where the telco of your choice has base stations.
The growth in voice revenues which largely contributed to overall revenues in the past isn’t what it used to be and telcos are keen to shore up their bottom lines by focusing on alternative high growth products. Data is one such product.
Safaricom this morning released their financial results. They registered impressive growth and profits.
Their mobile data revenue growth however, was unremarkable only growing by 21%. I say unremarkable because they have a 72.6% mobile data market share and, in my opinion, should be doing much better. The CCK’s report also states that 99 percent of the total data subscriptions are for mobile data (via phones and modems).
So why are we not seeing off the charts growth curves for data in Kenya?
1. Availability
Safaricom, the largest telco in Kenya, only has 5,354 base stations (out of which 2,449 are 3G enabled) which means that there are many places areas in Kenya where one can’t access mobile data. The same could be said for the other telcos.
Clearly, significant investment in new base stations is needed.
2. Quality of service
The quality of the mobile data services in some areas isn’t upto par. You’ll find that in some areas, the data service keeps fluctuating. This needs to be looked into.
3. Cost of access
The cost of access to mobile data has come down significantly over the years but it needs to come down (reasonably) even more so as to spur consumption.
4. Cost of modems
Kenyan telcos have subsidized the cost of mobile phones with internet access and even offering free data upon purchase. They should do the same with modems. Users tend to use more data on a computer so telcos should encourage the use of modems as much as possible. Subsidizing the cost of modems would help in their adoption.
Safaricom and other telcos can make more from data if they plug the holes discussed above and also market their data products more.