Kenya's telecom sector is shaping up for a major transformation that is likely to lessen the dominance of the major player, Safaricom.
Competitive pricing of products and services, offers and promotions and a dramatic shift in the target market in favour of the youthful populace by rival firms is slowly putting Safaricom, the largest mobile phone operator in East and Central Africa, under pressure.
Latest data from the Communications Authority of Kenya (CA) shows that the telco has lost about 17 percentage points of its market share over the past decade -- dropping to 67 per cent as at March this year, from 84 per cent in March 2008.
However, Safaricom, which is 35 per cent owned by South Africa's Vodacom, still retains its dominant position with about 29 million subscribers.
"Clearly, the competition has become more effective. The over 80 per cent market share was the peak and was never sustainable," Aly-Khan Satchu, chief executive of investment advisory firm Rich Management told The EastAfrican.
"This trend spikes the entire dominance debate that seems to pop up every so often."
In the mobile data/Internet business, Safaricom's market share declined to 68.4 per cent from 72.8 per cent, while Airtel gained 4.6 percentage points to 23.1 per cent.
Telkom Kenya's market share dropped to 7.6 per cent from 7.8 per cent while that of Finserve Africa Ltd , which operates the Equitel network, fell by 0.1 percentage points to stand at 0.5 per cent from 0.6 per cent .
Safaricom's management had not commented on the firm's dwindling market share by the time of going to the press.
Youth market
Telkom Kenya on the other hand has rebranded and renewed its bid to win the youth market with affordable data bundles.
The firm has also adopted a campaign dubbed "Every bob counts" that aims to ensure that its customers get value for their money.
"We have always been clear that we want to become the challenger in the market," said Aldo Mareuse, the chief executive of Telkom Kenya, which is jointly owned by the British Private equity fund Helios (60 per cent) and the government of Kenya (40 per cent).
"Telkom continues to invest in its network both for expansion and better accessibility but also with regard to quality of service, which has seen us invest close to Ksh8 billion ($80 million) towards our network modernisation programme over the past two years," said Mr Mareuse.
Bharti Airtel's Kenyan unit is also implementing a five-year plan that seeks to provide free Internet to schools.
The programme, which started in 2015 with an annual investment of Ksh30 million ($0.3 million) seeks to lure the younger generation to the firm's data platform.
It is argued that the share of Kenya's youth in the total population is among the highest in the world, presenting a huge opportunity for firms seeking to expand their customer bases.
The ratio of Kenya's youth (aged 15-24) to the population stands at around 20.3 per cent, above the world's average of 15.8 per cent and 19.2 per cent for Africa.
This ratio ties with that of Sudan but trails Uganda's 20.5 per cent youthful population.
Nigeria, the most populous country in Africa, has a youth share of 19 per cent, South Africa 18 per cent and Egypt 16 per cent.
