June 30, 2011 / 6:40 AM / 9 years ago

Telkom Kenya eyes 50,000-100,000 new data users

A Telkom Kenya employee arranges new mobile phones at one of their outlet in the capital Nairobi, September 17, 2008. REUTERS/Antony Njuguna

NAIROBI (Reuters) - Telkom Kenya, a unit of France Telecom, expects to add 50,000-100,000 customers for its data services this year, boosted by a technology upgrade in the third quarter, its chief executive said.

Telkom picked China’s number two telecom equipment maker ZTE to roll out a 3G network expected to be ready in the third quarter, at a cost of $47 million.

The firm said it has 150,000 data customers who attach USB modems to their computers to access the internet. “We expect to do 50,000-100,000 more between the launch date and the end of the year,” Mickael Ghossein told Reuters.

Data is seen as a major growth area in the telecoms sector, prompting firms to invest heavily to offset the impact of falling voice revenues on the back of a price war.

Ghossein welcomed President Mwai Kibaki’s move to stop a planned further reduction of the interconnection rate, also known as the mobile termination rate (MTR), which was set to fall to 0.90 shilling per minute next month from 2.21 shillings.

“It will put a stop to price wars and protect investments and bring more value for Kenyans in the future,” he said.

The Regulator Communications Commission of Kenya should reduce the frequency fees it charges operators to help them lower their costs, Ghossein said, adding the fees accounted for 30 percent of costs.

Telkom Kenya, whose mobile phone service has 2.5 million subscribers and is ranked third largest, has been losing money since France Telecom bought into it at the end of 2007.

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