Telkom Kenya, the country’s third-largest telecommunications company, has experienced a significant setback as it lost approximately 800,000 subscribers in the past three months. This subscriber exodus stems from the American Towers Corporation (ATC) switching off Telkom’s network towers due to unpaid leasing fees, exacerbating a dispute that had been ongoing for two years.
The impact of the tower switch-off was evident as Telkom’s mobile subscriber base dwindled to 1.3 million by December 2023. The disagreement between Telkom Kenya and ATC escalated in February 2023 when the latter deactivated 246 of Telkom’s towers, citing non-payment of leasing fees. Consequently, Telkom Kenya’s financial situation deteriorated further, with its debt ballooning to KES 7.1 billion ($51.7 million) by October 2023.
According to reports, ATC demanded an initial payment of KES 500 million ($3.6 million) and a monthly fee of KES 150 million ($1.09 million) to reactivate the towers. However, Telkom cited financial constraints as the reason for its inability to meet its debt obligations, further compounding the situation.
Prior to ATC’s acquisition of 723 towers in 2018, Telkom Kenya owned and managed its own towers. At the time of the acquisition, the telco stated that the move would “enhance the quality and reliability of our network to benefit our customers.” However, the recent events surrounding the tower switch-off have cast doubt on the effectiveness of this strategy, as the loss of network infrastructure has had a severe impact on Telkom’s subscriber base and overall operations.
As of June 2023, ATC Kenya had a total of 3,643 towers nationwide, including nine distributed antenna system sites. The company’s decision to switch off Telkom’s towers has significantly disrupted the telco’s services, leading to the substantial subscriber loss. While Telkom Kenya grapples with the consequences of the tower switch-off, the situation underscores the importance of maintaining financial stability and meeting contractual obligations in the telecommunication industry, where network infrastructure plays a crucial role in delivering reliable services to customers.
Source: https://www.techinafrica.com/telkom-kenyas-network-disruption-causes-massive-subscriber-loss/