Nokia Siemens Networks (NSN) and Alcatel-Lucent will invest in Kenya's Long-Term Evolution (LTE) network in a move that could prove complicated for Chinese telecom companies Huawei and ZTE.

Alcatel and NSN are two of the nine companies selected by the Kenya government to be co-investers in the 4G network as part of a special public-private partnership commonly know as the 4G special purpose vehicle. The partners are: the four Kenyan mobile network operators, Telkom Kenya Orange, Airtel, Essar Yu and Safaricom; three tier-two network operators, MTN, KDN and Epesicom; equipment vendors Alcatel and NSN; and the government.

The network will operate on an "open access" model, where the shareholders will build the network, then lease it out to different companies and organizations.

"We waited for treasury to approve government of Kenya investment through spectrum (800Mhz) in the Special Purpose Vehicle, we have finalized on the nine partners and it's just a matter of time," said Bitange Ndemo, permanent secretary in the Ministry of Information and Communication, explaining why the process has taken time.

The process of selecting partners and actual rollout was complicated because some of the equipment vendors had not applied to be partners directly but were hoping to use existing relationships to help roll out the network. For example, Huawei has strong links with Safaricom and ZTE is strongly linked with Telkom Kenya Orange. But with Alcatel and NSN being part of the consortium but also competitors to ZTE and Huawei, it is not clear how the rollout will be subdivided.

It's not clear whether the equipment vendors will subdivide the regions or whether one vendor will be selected. In addition, Safaricom has the widest infrastructure coverage and it is not clear how infrastructure sharing will work.

"Following the green light by the treasury to proceed with the arrangement, the working committee is still putting together the policy-building blocks and commercial nuts and bolts of the proposed LTE network," said Nzioka Waita, corporate communications director at Safaricom.

Kenya had options to either do a spectrum auction or award the project to the company most likely to deploy the network, based on financial muscle, but Ndemo said the public-private partnership was the most attractive.

Analysts have hailed Kenya's decision to opt for a public-private partnership model, which is expected to give an opportunity to smaller ISPs and content providers who may not have the financial muscle demonstrated by mobile network operators.

"At the core, this is really mostly about infrastructure sharing but motivated by the need to share scare resources (i.e. spectrum) and at the same time allow open access for operators of different maturity and financial capability," said Francis Hook, IDC East Africa manager. "No single operator can invest in 4G rollouts and expect to re-coup investments quickly without engaging in anticompetitive practices like charging high rates for other operators to use the 4G infrastructure."

Mobile network operators like Safaricom, Airtel and Orange, which have undertaken 3G rollouts, were initially skeptical about 4G because they had not recouped costs of 3G networks.

"Operators are facing gradually slowing revenue growth while at the same time having to continue maintaining networks, innovating and remaining competitive; it makes sense to share costs across operators, network equipment manufacturers and government," added Hook.

In Africa, there is no uniformity in 4G rollouts, with some countries like Nigeria and South Africa yet to choose between auction or public-private partnership. The issue of migration to digital TV seems to be complicating policy discussions because analog TV is on 700MHz, which is also used for LTE deployments. In South Africa and Nigeria, 4G is in a pilot phase.

"In Nigeria, MTN together with Ericsson have already announced plans to roll out a 4G network,  notwithstanding the fact that Nigeria Communications Commission has yet to resolve the issue of spectrum; Ericsson is doing the same with Vodafone in Egypt," Hook said.

Hook is expecting other countries in Africa to follow the open access model, as smaller ISPs, community networks and content carriers look for ways to deliver services at more affordable rates.