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Unlicensed ISPs Thrive as Internet Demand Increases, CA Alerts

Joseph Kimani by Joseph Kimani
January 6, 2025
in News
Reading Time: 3 mins read
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Internet Service Providers

Internet Service Providers

The Communications Authority of Kenya has raised concerns over the rising number of unlicensed Internet Service Providers (ISPs) operating illegally in the country.

This comes amid a surge in demand for internet services driven by remote work, online learning, and the growth of e-commerce.

According to the regulator, most of these unauthorized ISPs exploit license-free frequency bands, intended for industrial, scientific, and medical (ISM) applications, to evade regulatory requirements.

The Authority noted that these operators often provide services in localized, densely populated areas but lack the extensive coverage capabilities of licensed Network Facilities Providers (NFPs).

“The Authority has observed a growing increase in unauthorized ISPs across the country,” the CA said. “Most of them have deployed their networks using wireless technologies on License-free frequency bands intended for industrial, scientific, and medical applications (ISM),” CA added.

Dominated Market and Emerging Competition

The Kenyan fixed internet market remains dominated by major players, including Safaricom, which holds 36.4% of the market with 545,812 connections as of June 2024. Jamii Telecommunications is said to follow with 24% (360,446 connections). Wananchi-owned Zuku took the third position at 17.5 percent (263,008 connections).

Despite their dominance, the rise of new entrants such as Vilcom, Poa Internet, and Vijiji Connect has created competitive pricing dynamics, benefiting consumers but also leading to concerns about service quality.

According to Business Daily, many of these smaller players target low-income areas and satellite towns around Nairobi, often offering budget-friendly packages that compromise on reliability.

Satellite Internet Shakes Up the Market

A notable disruptor in the Kenyan ISP landscape is Starlink, Elon Musk’s satellite-based internet service. Since its entry into the market in 2023, Starlink has gained 8,063 subscriptions, accounting for 0.5% of the market by June 2024. Starlink’s presence has significantly contributed to the rise in satellite-based subscriptions, which reached 8,324 as of mid-2024.

Starlink’s arrival has sparked debates on regulatory frameworks for satellite-based ISPs. Safaricom, a dominant player in Kenya’s telecommunications sector, has unsuccessfully lobbied for the CA to mandate Starlink to partner with local firms.

While the CA acknowledges the increasing reliance on digital platforms for work, education, healthcare, and entertainment, it warns that the proliferation of unlicensed ISPs could jeopardize service quality and market stability.

“As of June 30, 2024, total fixed data/Internet subscriptions experienced growth driven by increasing reliance on digital platforms for work, education, healthcare, and entertainment, along with attractive tariffs and special offers from service providers,’ CA said.

The demand for internet services in Kenya shows no signs of slowing, as businesses, homes, and learning institutions continue to adopt digital solutions. The competition among ISPs is expected to intensify, with the entry of innovative players like Starlink shaping the future of connectivity in the country.

Tags: Communications Authority of Kenya
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Joseph Kimani

Joseph Kimani

Dedicated to delivering insightful, engaging, and accurate stories. Peaceful Soul

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