News, Celtel, Service Providers, Kenya: Mobile telephone service providers look set to extend their turf battles to the rural areas, where the cost factor is the only lure for consumers.

Celtel Kenya has unveiled a six-month promotion starting July 2008 that entitles customers to free monthly airtime worth Sh300 (US$4.50) for six months. However, to take advantage of the offer, users will have to purchase a low-cost phone. This can be either a Nokia 1110i or a Motorola C118 each retailing at Sh2,100 ($32.00). 

"Our main focus is to make inroads into the rural markets by subsidising the costs of the handsets," said Celtel corporate communications director Michael Okwiri. Celtel is seeking to push up its mobile penetration in the country, currently at 35 per cent nationally for the entire telecommunications industry. The number of local subscribers has grown to over 15 million. 

Celtel's main rival, Safaricom, boasts of having hit the 11 million mark this year, which leaves the former with the remaining 4 million subscribers. 

Just recently, a new range of phones, Mi, costing between Sh1,500 ($20.00) and Sh3,500 ($50.00), hit the market, targeting the same low-end consumer.