Airtel Kenya, the second-largest telco in that country, has started a commercial rollout of its Xtreme Fibre service across selected areas of Nairobi and other towns.
This marks a shift from earlier pilot phases into a market that is still largely dominated by Safaricom.
According to one Airtel representative, over 400 buildings in Nairobi are already connected, and in order to reduce switching expenses, installation fees are eliminated for both residential and business users.
With the drive, Airtel is making its first deliberate attempt to expand in fixed broadband, using aggressive pricing and free onboarding to break into densely populated areas where demand is concentrated. Instead of the fiber-to-the-home strategy preferred by incumbents, its concept is based on fiber-to-the-building, where a single connection serves an entire apartment block.
Although such architecture speeds up coverage and lowers rollout costs, the quality of the last-mile connection to in-building infrastructure is altered.
In a market where Safaricom accounts for 34.9% of subscriptions and competitors are still dispersed, Airtel is wagering that lower costs and quicker installation can entice customers away from established carriers.
With 15 Mbps at KES 2,000 (%15.45) and 100 Mbps at KES 5,000 ($39), Airtel’s pricing is below many similar plans, narrowing the area where incumbents have priced for margin. Instead of pursuing single-home installations, which are slower and more expensive to service, the corporation is concentrating on multi-dwelling units to secure volume per building.
With a 34.9% market share, Safaricom dominates the fixed internet sector, followed by Wananchi Group (11.1%) and Jamii Telecommunications (20.1%). Ahadi Wireless has 9.0% and Poa Internet has 10.7%. Since Airtel is not currently one of the leading operators, benefits will come from gaining market share rather than protecting it.
In response to concerns regarding indoor 5G performance, Airtel is updating its wireless product in addition to fibre. In areas where fibre is not yet available, it is switching to an external receiver and an inside router that are provided at no upfront cost to stabilise speeds.
In locations where incumbents are well-established, last-mile deployment and landlord agreements are crucial for scaling beyond a few hundred buildings.
