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Uganda Telecommunications Report Q4 2009
Market |
Telecommunications |
Report Type |
Market Research |
Country |
Uganda |
Published |
1 October 2009 |
Number of Pages |
58 |
Download |
|
Immediate |
|
Publisher |
Business Monitor International |
Orange secures 55,000 mobile subscribers in Uganda
Although not as profoundly affected by it as neighbouring countries Kenya and Tanzania, the switching on of the SEACOM cable also heralds the potential beginning of a new era in communications in Uganda, although in the report’s opinion it is an era that will be fairly slow in dawning. At the time of writing, no deals between Ugandan telecoms companies and the SEACOM company appear to have been struck for access to bandwidth, but this situation could change rapidly. However, while there is some infrastructure in place, it is by no means sufficient to provide good broadband coverage to even Uganda’s main population centres. Still, once Uganda is in some way connected to SEACOM’s plentiful bandwidth, it will start to have a growing impact on many areas of the telecoms industry.
The first quarter of 2009 saw competition intensify in Uganda, with Orange launching its service in March. By the end of the month it had secured 55,000 subscribers; results for Q209 have not been released yet. Still 55,000 is a good total for the first two weeks of operations, and, although launch momentum can never be fully maintained, we expect to see good things from Orange. Essar, now established in neighbouring Kenya, is apparently also looking to launch in Uganda, having acquired a licence to offer services. However, the latest news at the time of writing is that Essar is negotiating a majority stake in Warid’s Uganda network, so we may be looking at a new investor rather than a new operator in the market.
In the past three months, a lot of attention has been paid to the growing mobile banking and payment services market. Zain has released several announcements of new agreements with other organisations, allowing customers to use its ‘Zap’ mobile payment service to pay for a greater range of products and services, such as electricity bills and petrol. MTN has reported excellent uptake for its MTN Money service, and Uganda Telecom (UTL) has also begun offering some similar products.
SMS is also growing in popularity in Uganda, and the pattern of usage, combined with the pattern of growth in minutes of voice usage, paints an interesting picture of Ugandan mobile habits and indicates just how important prices are to consumers. Minutes of use have shot up, but only for calls within the same network. In their drive to offer their customers the lowest prices, operators tend to discount these calls heavily, and it seems that rather than shell out repeatedly for cross network calls, many mobile users are buying more than one SIM card and using each to call just within its own network. At the same time, the numbers for cross-network SMS have shot up, indicating that where they do not have multiple SIMs to use for each network, people are using SMS instead of calls, as they can be cheaper.
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