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Uganda Telecommunications Report Q4 2009Product Type: Market Research ReportPublished by: Business Monitor International Published: October 2009 Product Code: R302-8279 Description Although not as profoundly affected by it as neighbouring countries Kenya and Tanzania, the switchingon of the SEACOM cable also heralds the potential beginning of a new era in communications in Uganda,although in BMI’s opinion it is an era that will be fairly slow in dawning. At the time of writing, no dealsbetween Ugandan telecoms companies and the SEACOM company appear to have been struck for accessto bandwidth, but this situation could change rapidly. However, while there is some infrastructure inplace, it is by no means sufficient to provide good broadband coverage to even Uganda’s main populationcentres. Still, once Uganda is in some way connected to SEACOM’s plentiful bandwidth, it will start tohave 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 inMarch. By the end of the month it had secured 55,000 subscribers; results for Q209 have not beenreleased yet. Still 55,000 is a good total for the first two weeks of operations, and, although launchmomentum can never be fully maintained, we expect to see good things from Orange. Essar, nowestablished in neighbouring Kenya, is apparently also looking to launch in Uganda, having acquired alicence to offer services. However, the latest news at the time of writing is that Essar is negotiating amajority stake in Warid’s Uganda network, so we may be looking at a new investor rather than a newoperator in the market. In the past three months, a lot of attention has been paid to the growing mobile banking and paymentservices 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 andservices, such as electricity bills and petrol. MTN has reported excellent uptake for its MTN Moneyservice, 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 ofgrowth in minutes of voice usage, paints an interesting picture of Ugandan mobile habits and indicatesjust how important prices are to consumers. Minutes of use have shot up, but only for calls within thesame network. In their drive to offer their customers the lowest prices, operators tend to discount thesecalls heavily, and it seems that rather than shell out repeatedly for cross network calls, many mobile usersare 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 SIMsto use for each network, people are using SMS instead of calls, as they can be cheaper. Table of Contents
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