Measuring the Information Society 2011 Box 2.4: Kenya – Africa’s fastest growing Internet market Kenya is one of Africa’s fastest growing Internet markets, showing a 0.55 IDI value increase as compared with the world average of 0.46 and the African average of 0.23. This improvement is a result of the 37 per cent increase in the access sub-index due to the large growth in mobile-cellular subscriptions and a high increase in the country’s Internet bandwidth capacity. The use sub-index jumped 19 places to a value of 1.05, and compares very favourably with the African countries’ average of 0.44. Mobile-cellular tariffs have come down considerably due to increasing competition between providers in Kenya. The 2010 ICT Price Basket results show a substantial decrease in the mobile sub-basket, in both absolute (-14 per cent) and relative (-46 per cent) terms. New entrant Airtel sparked a price war and initiated fierce competition in the Kenyan market last year by reducing voice-call rates by half and cutting prices of sms charges (in local currency) from KES 3 to KES 1 (USD 0.03 to USD 0.01). Other operators, such as Safaricom and Telkom Kenya, expectedly followed suit, making further cuts to their mobile rates. The cheaper calling rates captured new subscribers in un-der- out its 3G network this year and double the amount of 2G stations already deployed. CCK also confirmed authorization of mobile-number portability, which will add user flexibility to change between service providers. In addition, several initiatives were taken to increase Internet bandwidth. Last year, Verizon Business, a unit of US Verizon Communications, expanded its IP network coverage in Kenya to serve Verizon’s business customers. This was in alliance with Gateway Business Africa, in an effort to provide better connecti-vity in the eastern parts of Africa and other developing regions.22 Another network extension in Kenya is the Lower Indian Ocean Network (LION) project. In consortium with Africa Coast to Eu-rope (ACE), this project involves the construction of undersea cables in the Indian Ocean providing broadband Internet service between Europe and South Africa. The entire network project is expected to be completed by 2012. The second phase of the project has started and will increase bandwidth capacity up to 1.28 Tbit/s.23 penetrated market segments and made cellphone services The efforts to enhance networks and mobile-market compe-tition more affordable. A recent halt to any further tariff reductions was announced in May 2011 by the Communications Commis-sion have already started to produce an effect by increasing the number of Internet users, including those connecting to the Internet via mobile networks. In December 2010, Kenya reached 10.2 million Internet users, a penetration rate of about 26 per cent. of Kenya (CCK) and President Kibaki in order to evaluate the impacts and economic profitability of the price wars.21 The presence of Airtel will still exert an effect as it continues to roll @$ )4( % % % ( # ,86 % % $ ( # ( 8 $ , 3 + # %\"$ $=# .$ > ( 86 % % %%3 \" ( $ = ($ 0>) * \" ( ,% 3 # ( E : , ( \"7 $ $ \" 5 %+1$ )($ + $ ( % 6 ( 3 +(\"(\" ( 86 % % % % $ ) ( # =$# $ 1>, ( (\"( \" ) 6, # 5( \" , ( # .$ =$ ( \" # ?$ # ( 5>) G +(\" 8 + % (,% % % % $ % # = -6)?>) # ( $ ( ( (\"( $ $ = ($ 0>, ((3 + ( % % $ \" ) 2 $ $ 7@ ( ( 5 5 %+7$ )( +% % ($ , ( ( \" # / 0?$ ) +,86 % % % \" % + \" ( + $ ) ; $ \"( $ @@ ($ ) $ % ( ) ,$ # 86 $ , ( + \" 8 ( ( % , ( 3% 6)C% % % $ (% 1)1$ %+ 17