Telkom Kenya Gets 3G License

Telkom Kenya, in which France Telecom (FTE) holds 51%, has gained a third-generation license in the East African country, the company said Wednesday.

The company was granted the license Wednesday by the Communications Commission of Kenya, paving the way for it to launch high-speed Internet services for its GSM customers by early next year, the company said in a statement.

Telkom Kenya has carried out successful 3G tests across the country over the past year, the statement said.

"These initiatives are informed by consistent research into market needs and preferences and these are leveraged on technological advancements that characterize the ever-dynamic telecommunications sector," said Telkom Kenya Chief Executive Michael Ghossein.

Ghossein said the company intends to invest EUR30 million to roll out the service.

The number of Internet subscribers in Kenya rose from an estimated 400,000 users in June 2008 to more than 3.1 million in June this year, with the number expected to continue rising, the statement said.

In June, the commission reduced the 3G license fee to $10 million from $25 million, in response to operators' complaints that the fee was prohibitive.

Other operators that have already acquired the 3G license in the country are Safaricom Ltd. (SAF.NR) and India's Bharti Airtel Ltd. (532454.BY). But only Safaricom--the largest telephone operator in the country--is providing the service.

Airtel also plans to roll out its 3G service by June 2011.

-By George Mwangi, contributing to Dow Jones Newswires; [phone]; [e-mail]