Sometime back, Jamii Telecom requested the Communications Authority of Kenya to pay the 4G spectrum fee of KES 2.5 billion in instalments. The proposal was forwarded to Parliament for further analysis. After a couple of sittings, MPs allowed the bill’s propositions, which were then officially made into law in January 2019.
One key outcome of the law is that companies whose majority stake is controlled by Kenyans can pay license fees in equal instalments over a 10-year period.
Effectively, the law allows the likes of JLT to beam 4G signals to their customers if they can service their license fees over that period.
With this development, the CA has finally awarded the telecom company with the LTE 700 MHz frequency license. As mentioned, the overall cost of the certification is KES2.5 billion, which is quite high for telcos that do not command massive profits.
The fee had also been questioned by Airtel, which escalated the matter to the court where the Indian-owned mobile operator faulted the price for being too high.
Airtel had suggested paying a fee that matches its profits (or lack thereof as the carrier has not made any substantial financial gains in a market that largely uses Safaricom services), although it did end up securing the license at a full price.
JTL paid KES 250 million upfront. The payments will also include an annual fee of KES 11 million for what is called ‘frequency fee.’ In total, JTL will be parting with about KES 300 million per year for the license.
Lastly, Airtel, Telkom, and Safaricom, which are primarily owned by Bharti Airtel India, Helios and Vodacom will not benefit from the law.