telecoms

AccessKenya ups the ante and Zain Kenya’s Merali ditches equity.

In the news this past week, AccessKenya has announced that it is now fully operational on the SEACOM high speed under sea cable. As a direct consequence, AccessKenya has doubled Internet bandwidth for all of its customers at the same prices that they have been paying to-date. AccessKenya has also announced that it has acquired 2500 megabits capacity on SEACOM as a well as similar capacity on the yet to go live TEAMS cable. This means that AccessKenya will have a total of 5000 megabits Internet bandwidth capacity by the end of September 2009 when TEAMS is expected to go live. AccessKenya has also invested significantly in building out its last mile infrastructure using various wireless and fiber technologies, ultimately giving them an end-to-end Internet service by owing the entire bandwidth delivery channel. Incidentally, we use AccessKenya at work and over the past couple of weeks we have had been experiencing much faster Internet speeds, for a change.

In other news last week, Naushad Merali who owned 20% in Zain Kenya quietly sold around 15% of his shareholding in the struggling mobile network sometime earlier this year. Could this be a sign that Zain Kenya is in much larger trouble than they may be letting on? The point here being that Kenya has one of the largest and fastest growing mobile telecoms sectors with close to 18 million subscribers currently. Therefore, for Naushad Merali to ditch such a substantial chunk of his equity in Zain Kenya it can only mean that a storm is brewing and he bailed out before the sailing got too rough. Whatever the case, it looks like Zain Kenya has a tough road ahead as their market share has remained marginal to dominant Safaricom. It also doesn’t help that Zain is looking to sell their Pan-African operations to a suitable buyer but no one seems to biting, yet.

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3 Comments

  1. August 24, 2009 at 3:35 am — Reply

    merali always knows when (& how) to leave other shareholders in a lurch. Look at his listed firms… sasini, sameer & eveready… show me an investor (except merali + cohorts) who have made money!

    BTW, it seems only the corporate (not SoHo) clients have benefitted from this move. I would move to AK (SoHo) but their installation cost is a damper. 12,000+ VAT when everyone else is giving out modems for free. Even safcon’s 4,000/- modem comes with 2GBs free…

    Perhaps, AK should give 1/2/3 months free upon payment of the installation fee… essentially rebate the entire fee off the cost of service. That would attract more customers esp in the SoHo market.

  2. Godfrey
    August 24, 2009 at 6:14 am — Reply

    I work in an organization where AccessKenya is the ISP. To say the truth, the internet speeds are nothing to write home about. Even when its fast, it becomes extremely choppy: its on this minute, then off the next. You have to click the refresh buttons at least five times before the connection goes through. Theres a lot that needs to be done to get reliable internet in Kenya and having a fibre optic connection is just not enough.

  3. ~Geko~
    August 24, 2009 at 7:05 am — Reply

    I have been a loyal accesskenya sub for sometime now, owing to their undoubted customer service and service reliability, the traditional 32/128 even if trippled does not meet the current needs in the fiber age, on the SoHo end, access should do something. I have personally not experienced the additional double speeds in my soho package save at night when i am going to bed (Watch movies online in my dreams)?

    i have gotten bombarded with offers but i am hesitant to leave AK unless nothing changes, All in all its a matter of time i crossed over to the broadband world.

    Fiber is Here!! Guys lets move from KBs to MBs, we are willing to pay for that.

    ~~~Geko~~~

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