Telkom Kenya the biggest loser as telcos shed 800,000 users
Business
By
Macharia Kamau and Frankline Sunday
| Mar 14, 2024
Telkom Kenya lost more than 700,000 subscribers in just three months, accelerating the decline the company has been on in the recent past.
The mobile service operator had 1.34 million subscribers as of December 2023, a 36 per cent drop from the 2.11 million customers it had in September, according to the latest data by the Communications Authority of Kenya (CA).
Equitel, the Mobile Virtual Network Operator (MVNO), which is owned by Equity Bank, has now surpassed Telkom Kenya in terms of number of subscribers, with 1.5 million customers. MVNOs, unlike the mobile network operators, do not have infrastructure and instead rent the infrastructure from the mainstream operators.
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This is in comparison to Safaricom, which had 44 million subscribers as of December, although the largest mobile network operator also lost about 100,000 customers from the 44.11 million that it had as of September.
It is also in comparison to 19.39 million subscribers on the Airtel Kenya network, which registered a gain in the number of subscribers over the quarter from 18.9 million in September. CA attributed the drop in subscribers for the two telcos to high churn compared to the number of new customers recruited by the companies.
Holding ="https://www.standardmedia.co.ke/health/financial-standard/article/2001485742/how-sh6-billion-telkom-deal-was-hatched-in-6-days">multiple SIM cards< is a common feature among Kenyan subscribers scouting for deals offered by the different operators. Many tend to abandon their non-primary SIM when no deals are forthcoming.
The CA data also indicates that the number of smartphones in the country now surpasses that of feature phones, with 33.6 million smartphones compared to 31.8 million feature phones in circulation.
“The number of mobile subscriptions dropped from 67.1 million reported last quarter to 66.7 million during the reference period,” said CA in its quarterly statistics report for the period to December.
“There was a decline in mobile subscriptions which is attributed to high churn vis-à-vis acquisitions and especially with regard to Telkom Kenya Limited. Consequently, mobile penetration rate declined by 0.8 percentage points to record 131.9 per cent.”
Telkom Kenya has been on a losing streak in recent years, having seen its subscriber base fall from 4.1 million in June 2021.
Among the factors that have been at play are the botched plans to merge with Airtel Kenya as well as the exit of Helios Investment Partners in August 2022 in a deal that saw Treasury pay Sh6 billion, kicking up a storm about the legality of the deal. The telco has since then been in a lull, with minimal campaigns to attract and retain subscribers.