Cellphone price war following Orange launch.

Kenyan mobile telephone customers are enjoying a vicious price war between Telkom Kenya’s new Orange service and the market leader Safaricom and its main competitor Zain (formerly Celtel).

Orange’s tariff of KSh1 per minute is the lowest in the market and is aimed at enticing Safaricom and Zain's over ten million subscribers to switch to the new operator.

The introduction by Telkom Kenya of mobile services follows the acquisition by France Telecom of 51 per cent of its capital for KSh26 billion last December. Orange is the key brand of France Telecom with a presence in many parts of Europe and Africa. In Kenya its GSM mobile services – offered thanks to a roaming agreement with Safaricom – are currently only available in Nairobi and the coastal city of Mombasa, although the company will build its own country-wide infrastructure in due course.

Consumers also expect to enjoy better rates from November when a fourth mobile service provider, Econet, enters the market.

In September Zain launched what was then the lowest tariff on the market, charging KSh8 per minute.

Instead east Africa's most profitable mobile telephone operator Safaricom is yet to make any major changes to its charges, which currently stand at KSh10 per minute for calls within its network and KSh25 for calls outside the network. Indeed, all is not well for the company, whose shares are trading at KSh4.30 compared to KSh5 earlier this year.