Telkom Kenya's towers shut down by ATC due to non-payment of fees

American Towers Corporation (ATC) has disconnected government-owned Telkom Kenya from its tower infrastructure for failing to pay site leasing fees.

The shutdown has led to service disruptions on the telco's network and according to media reports, Telkom Kenya owes ATC 3.5 billion Kenyan shillings (US$24 million).

This is not the first time that Telkom Kenya's towers have been shut down – the company has been going through network disruptions since the end of January this year.

After a public outcry in June 2023, Telkom Kenya CEO Mugo Kibati released a statement acknowledging the outages and said the company was engaging with stakeholders to restore the impacted services.

"Telkom and its stakeholders are reviewing the short to long-term strategic imperatives that will improve and guarantee the provision of these services to its esteemed customers," Kibati said at the time.

In 2018, ATC agreed on lease and service terms with Telkom, acquiring 723 towers from the operator in the process but according to ATC, Telkom has since breached the agreement terms, forcing it to cut supply at 896 sites.

"To ensure the financial viability of our business, we sometimes have to make difficult decisions such as disconnection, which we use as a last resort. However, this is conducted always within the law and the conditions stipulated in our contracts and following various unsuccessful attempts to recover monies owed to us," an ATC spokesperson told Telco Titans.

Tower turnoff causes problems

As some of the tower sites are shared, the shutdown has also disrupted other operators' services and ATC has claimed that Telkom has used police officers to block ATC from accessing some Telkom sites.

Currently, the Kenyan government owns 100% of Telkom and has been actively on the hunt for investors to help the telco with its debt.

Telkom Kenya has been going through network disruptions since the end of January 2023. ( Source: Image by Allexxandar on Freepik).

The government already owned 40% of Telkom and acquired the remaining 60% stake owned by British investment firm Helios Investment Partners in April 2022.

That government buyout came after a failed merger between Telkom Kenya and Airtel back in 2020 which would have seen the telcos joining forces to take on dominant operator Safaricom.

After walking away from the deal Telkom Kenya has remained firmly in third place in the Kenyan mobile market, with about 3.4 million mobile customers in the second quarter of 2023, figures from market research company Omdia, a sister company of Connecting Africa, show.

Telkom is far behind market leader Safaricom's almost 45 million subscribers and second place Airtel Kenya's 18 million users but does come out ahead of Jamii Telecommunications, which only had an estimated 404,260 subscribers in the same period.

*Top image source: Image by wirestock on Freepik

— Matshepo Sehloho, Associate Editor, Connecting Africa