**Updated post**
A special issue of the Kenya Gazette notice number 2431, of The Kenya Communications Act (No.2 of 1998), dated 31 March 2006 set outs the ICT legislative policy environment for the Kenya Information and Communications Bill- 2006, now with the Attorney General pending publishing, discussion and passage in Parliament, and Presidential accent
The published "Information and Communications Technology Sector Policy Guidelines aim to, inter alia, create a new-look Communications Commission of Kenya -a converged Regulator for the entire ICT sector, including broadcasting under a new regulation framework in the converging and competitive environment, and also to manage a universal service fund established to finance ICTs in rural areas and under-served segments.
The Fund will be financed by the operators providing services in the various market segments.
Investors, operators and service providers are expected to participate in the provision of universal service/access; develop a sector with efficiency, credibility, commercial integrity and good corporate governance; provide quality and sustainable service with pluralism of choice to consumers; and keep abreast with and participate in ICTs both regionally internationally.
With the increasing and competing demands for spectrum; market principles will be applied to promote effective use of the radio frequency spectrum, however the Government will ensure that spectrum fees does not become a burden to operators.
Regulations being developed will ensure that telecommunications and networks are robust, resilient, and have adequate security, redundancy and backup arrangements on critical components of the national infrastructure.
Consumers are now legally empowered to demand universally available, affordable, quality services from service providers and to review government consumer-protection policies along
technological changes and consumer trends.
Unlike in the Kenya Communications Act, still in force, where the term "consumer" is mentioned just once, seemingly in passing, in sections 23 and 47, "consumer" and "user" are now mentioned 8 and 18 times respectively in the published policy.
On privacy, for example, fundamental human rights relating to telemedicine and use of IT in health delivery, the government will provide IT facilities in all public health facilities; IT training
to medical staff; set standards and norms for IT in the healthcare system; and legislation governing telemedicine and health information; and establishment of national resource centres
for IT in healthcare.
Diverse stakeholder interests groups are frustrated with the slow enactment process, some even suggesting to demonstrate to the Attorney General offices to demand publishing of this inclusive, non-contentious draft law concluded in June 2005 at Mombasa.
Alex Gakuru
Saturday, March 31, 2007
Thursday, March 29, 2007
Focus on Internet Users
[Kenya Broadcasting Corporation]
CCK to keep track of internet users
Written By:Stanley Wabomba , Posted: Wed, Mar 28, 2007
Internet service providers are required to submit duly completed information return forms to the Communications Commission of Kenya- CCK after every three months.
CCK director general John Waweru says it is mandatory for the providers to submit the forms detailing how many new Internet users have joined and those who have left their networks.
The information is essential to maintain an up-to-date ICT database in the country.
Speaking at an Internet market study workshop in Nairobi, Waweru said lack of up-to-date information has created a scenario where Western experts estimate the facts. They often end up with gross under-estimation and mis-representation of facts.
The Internet market study established that Internet service providers in the country exploit consumers by inflating the cost by more than double what they are supposed to charge.
Although there are 51 licensed Internet providers, Internet service is only available in 20 out of the over 70 districts.
Nairobi and the Coast have 90 percent of the country's Internet users, which prompted CCK to urge providers to expand coverage to rural areas and narrow the information technology gap.
----------------------------------
[East African Standard]
CCK urges more Internet access
By James Ratemo and Edith Fortunate
Published 29 March, 2007
The Government has promised to expand Internet infrastructure.
Communications Commission of Kenya Director General, Mr John Waweru, says low uptake of the Internet poses the risk of Kenya lagging behind in reaping the benefits from the fast evolving digital economy.
Waweru was speaking in Nairobi when he received a CCK-commissioned study that found there are more than 2.7 million Internet users in the country. This figure is in contrast to an earlier International Telecommunications Union’s estimate of only 1.5 million.
Nairobi Province has the highest concentration, taking over 80 per cent of the Internet users followed by Coast at a paltry 9.4 per cent.
A local ICT and management consultancy firm in Nairobi, Netcom Information Systems, Conducted the study — Internet Market Study — from last October.
There are more than 50 Internet service providers (ISPs), 20 public data network operators, six Internet back-bone and gateway operators and over 20 local loop operators.
Only about 20 per cent of the users are spread in the small towns, the study says.
Releasing the report, Netcom Director, Prof Timothy Mwololo, said the cost of bandwidth and leased-line tariffs had remained high despite liberalisation of the sub-sector.
The study recommends licensing of more ISPs to provide Internet access and switching services.
---------------------------
[Business Daily Africa]
Middlemen hike internet costs, study shows
By Okuttah Mark Published 29 March, 2007
A study on the penetration of Internet services in Kenya has recommended that the communications authority slash the number of intermediate operators in online services.
The study commissioned by the Communications Commission of Kenya (CCK) last year found Internet access has remained elusive to most Kenyans, primarily because of high charges
Timothy Waema, the lead consultant with Netcom Information Systems Limited, which conducted the study for CCK, said multiple layers of middlemen increase the price of the bandwidth, which is eventually felt at the end user level. “The cost of two megabits per second (Mbps) of bandwidth at the international level goes for $2,000, but when it reaches the Internet service provider level (in Kenya) and the cost is $5,700 this is later passed to consumers” he said.
According to the study, the hierarchy of Internet provision services starts with global Internet providers, then on to international backbone and gateway operators (IBGOs) then to the country ISPs, and lastly to consumers.
Prices will increase down the chain, but the study found the final charges can be minimised by cutting out the IBGOs. The extra players could also be hurting the quality of the data transmission as well.
The study also showed that Internet users have grown in Kenya over the past give years to reach 2.7 million.
CCK to keep track of internet users
Written By:Stanley Wabomba , Posted: Wed, Mar 28, 2007
Internet service providers are required to submit duly completed information return forms to the Communications Commission of Kenya- CCK after every three months.
CCK director general John Waweru says it is mandatory for the providers to submit the forms detailing how many new Internet users have joined and those who have left their networks.
The information is essential to maintain an up-to-date ICT database in the country.
Speaking at an Internet market study workshop in Nairobi, Waweru said lack of up-to-date information has created a scenario where Western experts estimate the facts. They often end up with gross under-estimation and mis-representation of facts.
The Internet market study established that Internet service providers in the country exploit consumers by inflating the cost by more than double what they are supposed to charge.
Although there are 51 licensed Internet providers, Internet service is only available in 20 out of the over 70 districts.
Nairobi and the Coast have 90 percent of the country's Internet users, which prompted CCK to urge providers to expand coverage to rural areas and narrow the information technology gap.
----------------------------------
[East African Standard]
CCK urges more Internet access
By James Ratemo and Edith Fortunate
Published 29 March, 2007
The Government has promised to expand Internet infrastructure.
Communications Commission of Kenya Director General, Mr John Waweru, says low uptake of the Internet poses the risk of Kenya lagging behind in reaping the benefits from the fast evolving digital economy.
Waweru was speaking in Nairobi when he received a CCK-commissioned study that found there are more than 2.7 million Internet users in the country. This figure is in contrast to an earlier International Telecommunications Union’s estimate of only 1.5 million.
Nairobi Province has the highest concentration, taking over 80 per cent of the Internet users followed by Coast at a paltry 9.4 per cent.
A local ICT and management consultancy firm in Nairobi, Netcom Information Systems, Conducted the study — Internet Market Study — from last October.
There are more than 50 Internet service providers (ISPs), 20 public data network operators, six Internet back-bone and gateway operators and over 20 local loop operators.
Only about 20 per cent of the users are spread in the small towns, the study says.
Releasing the report, Netcom Director, Prof Timothy Mwololo, said the cost of bandwidth and leased-line tariffs had remained high despite liberalisation of the sub-sector.
The study recommends licensing of more ISPs to provide Internet access and switching services.
---------------------------
[Business Daily Africa]
Middlemen hike internet costs, study shows
By Okuttah Mark Published 29 March, 2007
A study on the penetration of Internet services in Kenya has recommended that the communications authority slash the number of intermediate operators in online services.
The study commissioned by the Communications Commission of Kenya (CCK) last year found Internet access has remained elusive to most Kenyans, primarily because of high charges
Timothy Waema, the lead consultant with Netcom Information Systems Limited, which conducted the study for CCK, said multiple layers of middlemen increase the price of the bandwidth, which is eventually felt at the end user level. “The cost of two megabits per second (Mbps) of bandwidth at the international level goes for $2,000, but when it reaches the Internet service provider level (in Kenya) and the cost is $5,700 this is later passed to consumers” he said.
According to the study, the hierarchy of Internet provision services starts with global Internet providers, then on to international backbone and gateway operators (IBGOs) then to the country ISPs, and lastly to consumers.
Prices will increase down the chain, but the study found the final charges can be minimised by cutting out the IBGOs. The extra players could also be hurting the quality of the data transmission as well.
The study also showed that Internet users have grown in Kenya over the past give years to reach 2.7 million.
Door opens for new non-profit telecom firms
[Business Daily Africa]
By Okuttah Mark
28 March, 2007
Licence-free band spectrum, courtesy of the airwaves’ regulator, could allow non-profit organisations to own and operate telecom companies.
The Communication Commission of Kenya’s offer of the ISM Band 2.4 and 5.8 spectrum to registered community groups is on a first-come-first-served basis, and already organisations from Mukurweini, Khwisero, Limuru and Rangwe have expressed interest. Countries like Tanzania, Namibia, Bangladesh and India have used the concept of free frequencies in efforts to bridge the ‘digital divide’ with the West.
Alex Gakuru, of the ICT Consumers Association of Kenya (ICAK) , hailed the move by the CCK. He said it will enable those in far flung areas to manage their information systems without waiting for operators who might not see a good business case for moving into those areas.
“Telecommunication companies have failed consumers on liberalisation promises of cheaper, better and widespread services,” said Mr Gakuru. In 1999, placing a one minute call through Telkom Kenya network was just Sh1, while now after sector liberalisation it stands at seven shillings, he said.
Through his association, Mr Gakuru is advocating for the cause of community owned telecoms. He said now most customers have little input into the products and services being offered by the telecommunication companies.
As demand for ICT services rise so does price. Consumers are bombarded with products and services that don’t fit their communication needs. For example, the wireless data transfer service known as General Packet Radio Service (GPRS), which failed to take off despite promising speeds of up to 115Kbits per second.
“In the current situation ICTs cause more poverty than prosperity. It is cheaper to board a matatu, take a 10megabits file than attempt to upload via email at 32 kilobits per second,” he said.
To Mr Gakuru, the best way to protect consumers is to allow them to own their own telecom companies.
In Khwisero, the constituents have placed communications at the top of their needs and through the Constituency Development Fund (CDF), they have put a proposal to spare between Sh3 million-Sh5 million for connecting the area with fibre and deploying wireless networks.
The community intends to use Wifi enabled mobile phones to access both voice and data communication.
In Rangwe, there are plans by the constituents to connect the area with fibre over electric cables.
Although ICTs future is still bright, only companies who have user centric models will survive, points Gakuru.
Door opens for new non-profit telecom firms
By Okuttah Mark
28 March, 2007
Licence-free band spectrum, courtesy of the airwaves’ regulator, could allow non-profit organisations to own and operate telecom companies.
The Communication Commission of Kenya’s offer of the ISM Band 2.4 and 5.8 spectrum to registered community groups is on a first-come-first-served basis, and already organisations from Mukurweini, Khwisero, Limuru and Rangwe have expressed interest. Countries like Tanzania, Namibia, Bangladesh and India have used the concept of free frequencies in efforts to bridge the ‘digital divide’ with the West.
Alex Gakuru, of the ICT Consumers Association of Kenya (ICAK) , hailed the move by the CCK. He said it will enable those in far flung areas to manage their information systems without waiting for operators who might not see a good business case for moving into those areas.
“Telecommunication companies have failed consumers on liberalisation promises of cheaper, better and widespread services,” said Mr Gakuru. In 1999, placing a one minute call through Telkom Kenya network was just Sh1, while now after sector liberalisation it stands at seven shillings, he said.
Through his association, Mr Gakuru is advocating for the cause of community owned telecoms. He said now most customers have little input into the products and services being offered by the telecommunication companies.
As demand for ICT services rise so does price. Consumers are bombarded with products and services that don’t fit their communication needs. For example, the wireless data transfer service known as General Packet Radio Service (GPRS), which failed to take off despite promising speeds of up to 115Kbits per second.
“In the current situation ICTs cause more poverty than prosperity. It is cheaper to board a matatu, take a 10megabits file than attempt to upload via email at 32 kilobits per second,” he said.
To Mr Gakuru, the best way to protect consumers is to allow them to own their own telecom companies.
In Khwisero, the constituents have placed communications at the top of their needs and through the Constituency Development Fund (CDF), they have put a proposal to spare between Sh3 million-Sh5 million for connecting the area with fibre and deploying wireless networks.
The community intends to use Wifi enabled mobile phones to access both voice and data communication.
In Rangwe, there are plans by the constituents to connect the area with fibre over electric cables.
Although ICTs future is still bright, only companies who have user centric models will survive, points Gakuru.
Door opens for new non-profit telecom firms
Sunday, March 25, 2007
Hefty missed opportunity as State fails to seal deal
[The Daily Nation]
Story by JAINDI KISERO
Publication Date: 3/21/2007
Just the other day, a group of Arab investors led by V-Tel Communications of Dubai came here and offered to pay the Government a whopping Sh12 billion($169million) for a licence to operate both a fixed line and mobile telecommunications services.
V-Tel Communications partnered with Palestine’s PalTel as a technical partner.
To prove their seriousness, the Arab investors had gone to the extent of sending to the Government bank statements showing that they, indeed, had the money for the licence fee.
But as it turned out, the Government refused to accept the money, citing a disagreement between the Arabs and their local partners, and arguing that it risked exposing itself to endless litigation.
Basically, the deal collapsed because we have a law, which stipulates that any foreign investor putting his money in the telecommunications sector must sell 30 per cent of the shareholding of the business to locals.
The deal fell through because V-Tel’s local partners could not raise their share of the equity.
KENYA, THEREFORE, MISSED WHAT would have been the single largest foreign direct investment (FDI) in decades.
With the Arab investors out of the way, we offered the same licence to Indian investors at the price the Arabs had agreed to pay. Led by the Reliance group — one of India’s largest conglomerates — the Indians immediately went into negotiations with the Government for the lucrative licence.
After six weeks of negotiations, the Government last week announced that the deal with the Indians had flopped.
A story in the current issue of The EastAfrican says, the Indians — unlike the Arab investors — started making too many fresh demands and privileges on the Kenya government. The story narrates how the Indians had made it clear to the Government that they were not prepared to cough up Sh12 billion without commitment on several privileges, including zero import duties on telecommunications equipment, zero Value-Added Tax and sharing infrastructure with the existing mobile firms. If you want details on the excessive privileges the Indians demanded, grab a copy of the current issue of The EastAfrican.
Suffice to say negotiations flopped. The Government now says that it will put the market on the block again and invite fresh bids.
What is the way forward? In my view, this is the best opportunity for the Government to scrap the 30 per cent-local-shareholding rule. If you re-tender without repealing this rule, the next tender will also fail.
All that this rule does is to make it possible for the political elite to armtwist foreign investors to give them shares free of charge.
Whether it is Kenya, Tanzania, Uganda or any other African country auctioning a telecommunications licence, the local investors who will partner with the foreign investor will be politically-well-connected types: cronies of the President, a stalwart of the ruling party or a prominent businessman with tight connections with the ruling elite.
I am not against affirmative action in the allocation of shares to locals in new telecommunications companies. Indeed, no country has ever developed without having nurtured its own local and strong domestic capitalist class.
But what we are dealing with here is a parasitic class that insists on being given shares without having to pay for them. Whenever they are unable to raise the money either to pay for performance bonds or to subscribe for the equity, the locals will be the first to go to court to block the rolling out the investment.
Econet Wireless has been in the High Court of Kenya for years because of protracted legal disputes with its local partners.
At the end of the day, it is the ordinary consumer of telecommunications services that has suffered. Were it not for the machinations of these locals, Kenya would by now be having multiple providers of telephone services working side by side and competing in terms of both quality of services and prices.
We have to make up our minds whether what we want from these telecommunications companies is ownership of these firms by locals per se, or efficient services and low consumer prices for the ordinary user.
Fortunately for the Ministry of Information and Communications, scrapping the 30 per cent local shareholding rule should not be that difficult. Because the rule is part of subsidiary legislation, a mere notice in the official gazette by Information minister Mutahi Kagwe will do.
THE INFORMATION AND communications sector in Kenya is on a roller coaster, growing very rapidly. Total subscriber numbers for mobile phones hit a new peak of 7.1 million in October last year. Today, we are talking about a penetration rate of around 20 per cent.
Even the sick state-owned Telkom Kenya has been very active lately, cleaning its balance sheet, retrenching staff, while aggressively rolling out a CDMA fixed-wireless network in several towns.
Should we slow down the momentum merely to protect the interests of well-connected locals who won’t allow projects to roll out unless they are allowed to own shares in up-coming firms?
The Daily Nation Story by JAINDI KISERO
Story by JAINDI KISERO
Publication Date: 3/21/2007
Just the other day, a group of Arab investors led by V-Tel Communications of Dubai came here and offered to pay the Government a whopping Sh12 billion($169million) for a licence to operate both a fixed line and mobile telecommunications services.
V-Tel Communications partnered with Palestine’s PalTel as a technical partner.
To prove their seriousness, the Arab investors had gone to the extent of sending to the Government bank statements showing that they, indeed, had the money for the licence fee.
But as it turned out, the Government refused to accept the money, citing a disagreement between the Arabs and their local partners, and arguing that it risked exposing itself to endless litigation.
Basically, the deal collapsed because we have a law, which stipulates that any foreign investor putting his money in the telecommunications sector must sell 30 per cent of the shareholding of the business to locals.
The deal fell through because V-Tel’s local partners could not raise their share of the equity.
KENYA, THEREFORE, MISSED WHAT would have been the single largest foreign direct investment (FDI) in decades.
With the Arab investors out of the way, we offered the same licence to Indian investors at the price the Arabs had agreed to pay. Led by the Reliance group — one of India’s largest conglomerates — the Indians immediately went into negotiations with the Government for the lucrative licence.
After six weeks of negotiations, the Government last week announced that the deal with the Indians had flopped.
A story in the current issue of The EastAfrican says, the Indians — unlike the Arab investors — started making too many fresh demands and privileges on the Kenya government. The story narrates how the Indians had made it clear to the Government that they were not prepared to cough up Sh12 billion without commitment on several privileges, including zero import duties on telecommunications equipment, zero Value-Added Tax and sharing infrastructure with the existing mobile firms. If you want details on the excessive privileges the Indians demanded, grab a copy of the current issue of The EastAfrican.
Suffice to say negotiations flopped. The Government now says that it will put the market on the block again and invite fresh bids.
What is the way forward? In my view, this is the best opportunity for the Government to scrap the 30 per cent-local-shareholding rule. If you re-tender without repealing this rule, the next tender will also fail.
All that this rule does is to make it possible for the political elite to armtwist foreign investors to give them shares free of charge.
Whether it is Kenya, Tanzania, Uganda or any other African country auctioning a telecommunications licence, the local investors who will partner with the foreign investor will be politically-well-connected types: cronies of the President, a stalwart of the ruling party or a prominent businessman with tight connections with the ruling elite.
I am not against affirmative action in the allocation of shares to locals in new telecommunications companies. Indeed, no country has ever developed without having nurtured its own local and strong domestic capitalist class.
But what we are dealing with here is a parasitic class that insists on being given shares without having to pay for them. Whenever they are unable to raise the money either to pay for performance bonds or to subscribe for the equity, the locals will be the first to go to court to block the rolling out the investment.
Econet Wireless has been in the High Court of Kenya for years because of protracted legal disputes with its local partners.
At the end of the day, it is the ordinary consumer of telecommunications services that has suffered. Were it not for the machinations of these locals, Kenya would by now be having multiple providers of telephone services working side by side and competing in terms of both quality of services and prices.
We have to make up our minds whether what we want from these telecommunications companies is ownership of these firms by locals per se, or efficient services and low consumer prices for the ordinary user.
Fortunately for the Ministry of Information and Communications, scrapping the 30 per cent local shareholding rule should not be that difficult. Because the rule is part of subsidiary legislation, a mere notice in the official gazette by Information minister Mutahi Kagwe will do.
THE INFORMATION AND communications sector in Kenya is on a roller coaster, growing very rapidly. Total subscriber numbers for mobile phones hit a new peak of 7.1 million in October last year. Today, we are talking about a penetration rate of around 20 per cent.
Even the sick state-owned Telkom Kenya has been very active lately, cleaning its balance sheet, retrenching staff, while aggressively rolling out a CDMA fixed-wireless network in several towns.
Should we slow down the momentum merely to protect the interests of well-connected locals who won’t allow projects to roll out unless they are allowed to own shares in up-coming firms?
The Daily Nation Story by JAINDI KISERO
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