Telkom: 3G’s $25m licence fee ‘too high’

There is growing disquiet in the telecommunications industry in Kenya that the development of mobile phone technology could be stifled by exorbitant licence fees charged by regulators.

Already, the deployment of the 3G network by Telkom Kenya hangs in the balance over $25 million license fees levied by the Communications Commission of Kenya (CCK).

“The CCK should reduce the license fees as it could ultimately be a barrier to deepening communication services,” said Telkom Kenya chief executive Mickael Ghossein.

Under the Orange brand, Telkom Kenya provides wireless and Internet services such as Orange Mobile, Orange Fixed Plus and Orange Broadband.

The 3G network supports enhanced applications of the mobile phone technology such as video conferencing and mobile TV services thanks to its high speed data connections.

3G is a higher form of the 2G networks that are currently in use.

2G was principally developed to provide voice and relatively low speed data connectivity.

Orange has warned that it could put a halt to the commercial deployment of the 3G network if the industry regulator does not lower the “way out of reach” fees.

Mr Ghossein said that licences to operate the network are provided free of charge in some African countries though accompanied with some terms and conditions, and challenged the regulator to consider similar action.

Presently, Orange is in the process of carrying out a test run for the 3G network in partnership with Ericsson, a network infrastructure and telecommunication service provider. The test run is expected to be concluded by October 2010.

15 sites for the test run

About 15 sites have been chosen including the central business district and the area around Jomo Kenyatta International Airport.

These will be progressively rolled out to other towns.

This is going on as the firm seeks an agreeable solution to the standoff with CCK over license fees.

According to the CEO, his firm has presented a proposal, which takes into account different scenarios during deployment of the 3G network, to the regulator for consideration.