Mobile firms to pay millions for new ICT fund [Business Daily (Kenya)]
(Business Daily (Kenya) Via Acquire Media NewsEdge) The communications industry has appointed six members to a council paving the way for players to begin paying 0.5 per cent of their revenue to help people in marginal areas access services.
This comes at a time when the Communications Commission of Kenya (CCK) has forwarded a policy document to the Information ministry to back the Universal Access Fund (UAF).
The ministry made the six appointments to the Universal Service Advisory Council on Friday, clearing the way for mobile operators, Internet Service Providers (ISPs), and broadcasters to pay the tax.
CCK said that it had forwarded the universal access and broadband strategies document to the Information ministry for operationalisation after the March 4 General Election.
Among the key issue addressed are the need to increase high-speed internet access in the country and expanding investment in IT services to remote areas. Investors consider such areas commercially non-viable.
CCK director-general Francis Wangusi said the development of universal access and broadband would spur the growth of the ICT sector and accelerate the development of other sectors of the economy, including provision of e-government services.
Citing the ICT Access Gaps Study undertaken by CCK last year, Mr Wangusi said close to 1,120 sub-locations out of a total 7,149 in the country have no access to basic communication services.
(Read: New study reveals widening digital divide in Kenya)
He said that CCK would contribute 25 per cent of its surplus revenue to the kitty. "The bringing into operation of the fund will provide opportunity to the private and public sectors to work together in bridging the digital divide," he said.
"Clearly, deliberate policy and regulatory subventions are necessary to ensure that the country has the supportive infrastructure for deployment of e- and m- commerce as well as government services in all parts of the country."
Operators, led by Safaricom, had earlier asked the regulator to defer the implementation of the levy until those contributing to the kitty were brought on the board that would manage the fund.
On Friday, the Information ministry appointed Francis Limo (chairman), Joseph arap Bett, Joseph Watakah, Rosemary Kilonzo, Rukia Ahamed, and Sammy Buruchara to be members of the Universal Services Advisory Council for a year.
yuMobile Country Manager Madhur Taneja said the firm was not involved in picking names of the six members. It was not clear whether the other firms were consulted.
"Although we were not involved in the process (picking of the six names), I hope the ministry picked the right people because the money involved is big," said Mr Taneja.
The fund was supposed to come into effect in July 2010 after CCK published regulations on the policy which, among other things, created the Universal Service Advisory Council to manage and administer the fund but left out the operators.
"As an active member of the industry, Safaricom is continuing to engage CCK and other industry stakeholders with a view to deferring the implementation of the USF levy until an acceptable governance structure is in place to administer the fund," said Safaricom in its Sustainability report.
The mobile operators have also previously asked CCK and the Information ministry to come up with a national policy on USF that will guide the country.
In their submission to CCK, the operators also wanted the industry regulator to outline the manner in which the fund will be governed.
"The fund is expected to finance national projects that have significant impact on the availability and accessibility of ICTs in rural, remote and poor urban areas and shall promote the establishment of efficient, self-sustaining projects," says CCK on its website.
It says the initiative may support projects that are not economically feasible. They include availing of communications services to poor households, people with disability, schools, health facilities, and other organisations serving public needs.
The universal access and broadband strategies were developed through USAID's technical assistance.
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