Seacom said licensed businesses can now buy broadband of at least 20 megabits per second (Mbps). In this, Seacom is targeting the small and medium enterprises segment widely served by ISPs.
The firm wants to offload part of the 90 per cent of its bandwidth that is idle, company officials said, while providing the market with faster, reliable Internet services.
“Open access means all licensed operators and businesses in need of broadband can come to our data centres and landing stations and buy services directly. We don’t do home and small office requirements yet,” said Joseph Muriithi, Seacom regional manager.
The 20mbps will go at a wholesale price of $3,000 of unlimited broadband per month across Mombasa, Nairobi, Kampala, Addis Ababa and Dar es Salaam. Businesses and buildings within a radius of 60 km from the data centres will enjoy these services.
Rwanda and South Sudan could receive these services from November, when Seacom hopes to be fully licensed to operate in the two countries. The undersea cable operator said it has completed its link from Nairobi to Kampala through Tororo and it is now able to carry some traffic to South Sudan from Kampala.
Currently, Seacom is using Technology Authority Uganda cables and Liquid Telecom (formerly Rwandatel) to deliver broadband in the two countries respectively.
Though a welcome move to the buyers, Seacom’s plans join fibre-optic firms offering wholesale broadband to businesses may be upset by price and infrastructure.
READ: Internet costs to remain high despite increased capacity
Wananchi Group, through Zuku, sells 20mbps unlimited high speed Internet at Ksh5,499 ($60) per month and connects homes and businesses to their main cable in Nairobi and parts of Mombasa.
Jamii Telecom, through its Faiba product, offers between 5mbps and 20mbps to residential houses and businesses at Ksh5,000 ($54) and Ksh20,000 ($217) respectively. The two fibre service providers are shareholders in the Teams undersea cable.
Teams (The East African Marine System) is an initiative of the government of Kenya to link the country to the rest of the world and takes 60 per cent of the Kenyan market. Liquid Telecom, formerly Kenya Data Networks Ltd, owns 10 per cent of Teams and is into fibre broadband for homes and businesses.
“In the next year in Kenya alone, Liquid Telecom will invest over $20 million in connecting the 47 counties through fibre optic, satellite and wireless technologies,” said Paul Statham, chief commercial officer of Liquid Telecom Kenya.
According to Thomas Makau, an ICT and telecoms analyst, selling directly to businesses could be lucrative because some require huge amounts of bandwidth compared with what some Internet service providers offer.
“The networks being run by banks and insurance companies with a regional reach would provide a good business for the undersea cable companies,” said Mr Makau.
He added that when an undersea cable provider sells broadband wholesale, it is dedicated to the single buyer. On their part, third parties sell Internet to many parties with an assumption that the users will not all need it at the same time.
“When many use the Internet at the same time, it is slow and if overloaded it fails completely,” said Mr Makau.
Penetration of fibre connections is limited by inadequate infrastructure, leaving the competitors scrambling for the market in cities.
Zuku and Jamii Telecom, for instance, cover Nairobi and Mombasa where the companies have established a ring network — that is, cables laid beneath the earth in a ring around an area to ensure that bandwidth can move from either side of the ring. Any building with a fibre connection at one metre from the ring can enjoy a connection.
To mobile operators, the market is big enough for all players.
“Competition ensures that consumers get value, enhanced experience and quality service from operators,” said Adil El Youssefi, Airtel Kenya chief executive.
The East African
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