Jevans Nyabiage
11 July 2009
Nairobi — In what is expected to stir further competition in telecommunications, power supplier, Kenya Power and Lighting Company (KPLC) has announced plans to lease its distribution network to cable television operators.
Early this year the utility firm was awarded a telecommunications licence that allows it to enter the commercial data transmission market.
In a paid up notice appearing in Friday dailies, Kenya Power said that it was seeking bids for cable TV operators to lease its distribution network as it seeks to diversify its earnings from the sale of electricity.
Tight battle
The move is expected to up the tight battle for control of the commercial data market which has remained the domain of local firms Kenya Data Networks and Telkom Kenya.
The company has huge amounts of unused bandwidth and five years ago applied for a Data Carrier Network Operator (DCNO) licence which it failed to secure on grounds of legal constraints.
Kenya Power and Lighting Company is currently installing about 1,500 kilometres of high-quality fibre optic cable on its countrywide transmission network, primarily for its own use, in a $33 million (Sh2.5 billion) System Control and Data Acquisition (Scada) project.
The project is financed by the European Investment Bank and is being implemented by Swedish technology transnational ABB.
The mainland cable network will be completed by March next year, and according to the company will only use five out of the 24 fibres.
It has already floated an expression of interest for leasing of the extra fibre capacity.
However, the Network Facility Provider - Tier 2 licence, which Kenya Power and Lighting Company has allows it to lease out the excess bandwidth capacity of the fibre.
The extra capacity will initially be available on the Nairobi-Mombasa, Nairobi-Nakuru-Eldoret-Tororo, Eldoret-Kisumu and Nairobi-Kiganjo-Nanyuki routes.
Besides increasing competition in the telecommunications sector, it is expected to boost shareholder value as the company will not only optimally utilises its current transmission system, which boasts thousands of kilometres of fibre, but also create a new income stream.
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