Telkom Kenya has fallen from its long-held position as Kenya’s third-largest mobile operator, overtaken by Finserve’s Equitel, after months of service disruptions, disconnections, and customer churn. The decline marks a turning point for the state-owned carrier, underscoring the high cost of poor network reliability and financial distress in Kenya’s fiercely competitive telecom market.
According to fresh data from the Communications Authority of Kenya (CA), Telkom’s active mobile subscriptions dropped to 868,788 by June 2025, a nearly 40% decline from 1.4 million a year earlier. In contrast, Equitel now commands 1.5 million active subscribers, taking third place behind Safaricom, which leads with 49.9 million users, and Airtel Kenya, which follows with 23.7 million.
This collapse illustrates how quickly an operator can lose ground when debt, network failures, and eroding customer confidence collide.
Network Collapse and Mounting Debt
Telkom Kenya’s troubles trace back to 2023, when American Tower Corporation (ATC) disconnected approximately 900 cell towers over unpaid lease fees amounting to KES 7.1 billion ($55 million). The mass disconnection crippled coverage across several regions, especially in rural areas, leading to widespread service blackouts.
The operator acknowledged that the outage “severely degraded service quality” in multiple counties, prompting customers to migrate to rival networks. Both Safaricom and Airtel rapidly absorbed the displaced users, further tightening their dominance.
The CA’s Quality of Service (QoS) report for the 2023/2024 financial year painted a grim picture: Telkom scored just 55% in national drive tests — far below the 80% minimum regulatory benchmark. In comparison, Safaricom scored 86% while Airtel achieved 80%, both meeting the required standards. Telkom’s performance was dragged down by frequent call drops, poor voice clarity, and intermittent data connectivity, making it difficult to retain subscribers even in urban areas.
The Missing Payments Ecosystem
Unlike its competitors, Telkom Kenya lacks a robust mobile money platform to anchor its customer base. Its T-Kash service holds virtually 0% market share, compared to Safaricom’s M-PESA and Airtel Money, which together dominate over 99% of Kenya’s mobile payments market. This absence of a financial ecosystem leaves Telkom vulnerable to churn, as users have little incentive to remain on its network once connectivity falters.
Mobile money has become the backbone of Kenya’s telecom revenues, driving both customer loyalty and financial inclusion. Without an equivalent to M-PESA or Airtel Money, Telkom’s competitiveness in value-added services has evaporated, leaving it dependent on voice and data revenues — both shrinking segments in Kenya’s maturing telecom sector.
A Strategic Crossroads
Telkom Kenya’s demotion to fourth place poses existential challenges. With its subscriber base dwindling, the company risks losing the critical scale needed to attract capital or a strategic investor capable of funding its long-awaited 4G and 5G network rebuild. The Kenyan government’s buy-back initiative, once seen as a pathway to stability, has stalled, leaving uncertainty around ownership and investment direction.
Yet, Telkom still possesses valuable strategic infrastructure assets. It owns and operates over 4,000 kilometres of terrestrial fibre optic cabling, and maintains stakes in multiple undersea cable systems including TEAMS, LION2, EASSy, DARE-1, and PEACE. It also controls fibre backbones, landing stations, and data centres, which remain critical to Kenya’s internet backbone and regional connectivity.
Industry experts suggest that if properly leveraged, these assets could anchor a turnaround strategy, positioning Telkom as a wholesale network provider or a government-driven digital infrastructure player. However, without fresh capital, decisive leadership, and regulatory support, the operator risks continued decline in a market dominated by two powerhouses — Safaricom and Airtel — both of which continue to expand their reach in fintech, data services, and rural connectivity.
Telkom Kenya’s fall from grace serves as a cautionary tale for African telecoms — that network reliability, innovation, and financial discipline are inseparable pillars of survival in today’s digital economy.
