Telkom Kenya, which launched its mobile services in Kenya recently, will be banking on corporates and small businesses to drive growth in a market already dominated by two operators. It is hoping to wrestle subscribers using the Orange brand, owned by France Telecom, the Paris-based telecoms operator that bought a 51 percent shareholding last year in the former state corporation.

The company has been offering fixed and wireless telecommunication services, but has expanded in the fast growing telecommunication market with an estimated unserved market of six million people. "By offering several relevant communications services in one package, we can deliver unrivalled value, simplifying the customer experience and ensuring Kenyans receive world-class communications services at competitive prices,"  said Dominique Saint Jean, Telkom Kenya’s Chief Executive Officer (CEO).

This is a critical assignment for France Telecom which took control of Telkom for Sh2.6 billion last December as its bets on the mobile and Internet business to push it to profitability 2010. It has announced that it will be offering its services under the 0772 prefix starting with Nairobi and Mombasa before spreading to the rest of the country. Telecoms operators are integrating their fixed, internet and mobile networks to offer an inclusive package at special rates, a trend Safaricom, the biggest mobile operator adopted after acquiring data firm One Comm. Orange has unveiled a Kshs20 airtime top-up card indicating it is keen to reach out on the low end of the market. Currently, mobile penetration stands at 34 percent of the population and is expected to increase to 60 percent in the coming four years, as more rural dwellers and low income earners sign up.

However with the aggressive campaigns by Safaricom and Zain, it’s going to be an uphill task for Telkom Kenya even as it boasts an established infrastructure countrywide. Mr. Saint Jean however remains optimistic saying their potential of offering value-added services will crack the mobile telephony market. Econet Wireless, which is partly owned by India’s Essar is set to roll out its mobile services in November, taking the competition a notch higher. This means that the battle for market share will be fierce, with low airtime denomination seemingly coming in handy for market penetration.

Before the Telecom takeover, Telkom Kenya, the country’s oldest telecommunication company was a poor performer. The launch of Orange is a key milestone in Telkom’s complete revamp which includes investment of over Kshs8 billion (US$ 120 million) on infrastructure and maintenance, as well as additional investment going to enhancing customer service and internal training.

International Finance Corporation (lFC), a member of the World Bank Group, will invest Kshs1.79 billion in Diamond Trust Bank Kenya (DTB) to support its expansion and enable it increase lending to Small and Medium Enterprises (SME).

In a partnership signed in Nairobi, the management of the two firms said the deal is geared at diversifying the services of DTB to its clients.

lFC will also provide a long-term subordinated loan of Kshs1.05 billion to support DTB's expansion and a two-year senior term loan of Kshs700 million to promote its lending capacity to small businesses who form majority of the Kenyan banking consumer base.

IFC will also be providing advisory services to DTB Kenya focusing on expanding its range of products and services, enhancing risk management practices, and helping to increase its outreach to small and medium enterprises.

The transactions are part of a broader agreement under which IFC also expects to support DTB Kenya's trade finance activities.

"This collaboration will enable DTB Kenya to enhance its long-term lending capacity, continue with its expansion plans and explore additional opportunities in other frontier economies in Sub-Saharan Africa," said DTB Group Chairman Mr. Mahmood Manji.

"SME are one of the most important segments of the East African economies and a key driver for sustained economic growth and prosperity," he added.

DTB also plans to open 12 new branches in East Africa by the end of the year, extending its, branch network to 35 in the region. It also plans to open a new banking subsidiary in Burundi and is exploring establishment of banking operations in other African countries, including Rwanda, Madagascar and Mozambique in the next few years.

"Limited access to finance is a key constraint to private sector growth in Africa, especially for smaller firms that have minimal influence on policy reform," said Jean Philippe Prosper, IFC Director for Eastern and Southern Africa. "Supporting the growth of smaller businesses and enabling them to contribute more fully to economic development is one of IFC's strategic priorities in Africa."

DTB has increased its capital base significantly during the last three years to make it one of the top ten capitalized banks in Kenya. IFC has been a shareholder in DTB since 1983 and currently holds a 9.85 percent stake in the bank.

UUNET Kenya will spend $10 million (Kshs680million) to develop new products and solutions that will be compatible with the fibre infrastructure. Managing Director Mr Tom Omariba said the solutions will be IP-based which will enable customers run video conferencing, IP telephony and International Multiprotocallabel switching.

"Rather than spend money investing between Fujaira and Mombasa, we have opted to invest a sum of $10,000,000 in developing and preparing various products and solutions to run on the coming fibre that are necessary and relevant to our corporate customers," said Mr Omariba.

Addressing journalists in Nairobi, Mr Omariba said the move is geared to better quality, high capacity bandwidth for the region at an affordable price. This coincides with the introduction of fibre optic cables in the region, and expected entry of three major connections into the country by end of next year – which is expected to boost competitiveness by easing business communication and effectiveness.

Alcatel Lucent, the French telecommunications giant, has been awarded the tender for the construction of the 4,900 km TEAMS at a cost of $110 million with a tentative landing date of December 2009. The cable will last 25 years and is expected to lower the cost of bandwidth and increase access to the Internet.

TEAMS is, a joint venture between the Government of Kenya and the private sector, will have 45 percent government shareholding, with Dubai's Etisalat taking 15 percent, while the rest will go to regional telecommunications companies and Internet Service Providers (ISPs),as well as fund managers.

UUNET Kenya is a major corporate business solutions provider in Kenya, with over 600 top-tier customers. It invested in WiMAX infrastructure in 2006, which will be used to provide high speed broadband access of up to 4 Mbps to TEAMS when it becomes available.

Mr Omariba said with the coming of the submarine fibre, businesses in East Africa will be attractive to hackers, virus attacks and cyber sabotage. "Fortunately, we have security solutions for our corporate customers to enable them have self defending networks against such attacks if and when they come once the fibre is here," he said. “UUNET is moving away from triplay play to Quadruple play where voice, video and data would be combined with mobility.”