Global companies line up for 4G licence contract
Global telecoms firms are seeking to secure bids for the lucrative 4G licence spectrum in a contest that has seen Airtel sit out and Telkom Kenya risking being locked out for submitting its bid after the deadline.
Out of the 17 firms that handed in bids, eight are international but have partnered with local companies. They include Alcatel-Lucent, Huawei, ZTE, Lollakfi of UK, Ericsson, IBM, Epesi Communications and Cisco Networks.
Unlike in the past when the licence was awarded to each operator, the 4G will be controlled by a consortium of players including the government, a network developers and a mobile operator, who must have at least 20 per cent local ownership.
The requirement locked out Airtel, leaving Safaricom and Telkom Kenya and Essar’s Yu in the race for the tender.
On Wednesday, the Information Permanent Secretary Bitange Ndemo said the evaluation for the bids starts next week in the race to select the winner by December.
"This process brings structure to the procurement decision and is meant to allow the risks and benefits to be identified clearly upfront and things to be looked at this second stage will be technical and financial capability of the firms to deliver," said Dr Ndemo.
The response came as the ministry extended the bid period for 4G spectrum licence by 14 days to September 27 after firms gave the high-speed frequencies tender lukewarm reception. (READ: Telecom firms give 4G licence sale a wide berth)
But despite the extension, Telkom Kenya put its bid at the 11 am deadline exposing itself to legal challenges from rivals should it win the tenders since the government has said it will overlook the technicality.
"No comment on that Telkom Kenya limited bid with LTE. We haven’t got any official communication to the effect that we were late," said Telkom chief executive Mickael Ghossein.
This bid is set to renew the high stakes battle for the contracts that has pitted diplomats from Western and China angling for their firms to clinch the deals.
This bid is set to renew the battle between Chinese and Western telecoms firms for the mega infrastructure businesses in Kenya as local mobile telephony firms announce ambitious upgrade plans.
So far, Chinese firms including Huawei and ZTE are emerging top at the expense of the European firms such as Ericsson, Alcatel-Lucent and Nokia--companies that previously dominated in what has spurred diplomats to scour for deals for their companies.
ZTE is upgrading Telkom Kenya’s 3G network for Sh4 billion while Huawei also tied up a Sh12 billion deal with Safaricom for the roll-out of the firm’s 4G core network.
The international firms are looking to supply equipment and maintain the network for the consortium that will win the deal while the local telcos are looking at getting a larger piece of the data market in an environment where voice-related earnings have dropped due to price war that started last August.
The fourth generation (40G) is a wireless technology with a larger capacity to deliver data and facilitate high-end services such as video conferencing and gaming. Local players are racing to upgrade networks to tap a larger share of the data market in the increasingly competitive environment.
This article was originally posted on Africa ICT & Telecom Network
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