Market Report, "Uganda Telecommunications Report Q4 2012", Published

New Fixed Networks market report from Business Monitor International: "Uganda Telecommunications Report Q4 2012"


Boston, MA -- (SBWire) -- 11/08/2012 --BMI View: The Ugandan market is below the Sub-Saharan average in terms of penetration and ARPUs. This is an indication of the low GDP per Capita, and larger rural population, many of which do not have access to mobile services. The market has considerable potential for growth, but the reversal in penetration rate in Q112 shows that it is struggling to fulfil this potential. In terms of economy, the country's current account deficit is over 10% of GDP, although this is still lower than we previously estimated. We see potential for growth in the market, as the oil industry spurs larger increases in investment and exports in the longer term.

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Key Data

- New operator data revealed the market finished Q112 with 16.25mn mobile subscribers. MTN continues to lead the market with 47.5% market share

- New data from the UCC reveals there were 464,850 fixed lines in the country at the end of December 2011.This was a 144,000 increase on the end of Q311, which ended with 321,000 lines in service.

- The number of fixed internet subscribers rose to 88,786 by December 2011, while mobile internet subscribers stood at 977,500. Internet users rose to 4.8mn, up from 4mn at the end of 2010.

Risk/Reward Ratings

Uganda remained unchanged in BMI's Q412 RRRs, in 15th position, with no change to overall score for another quarter. The market is located in the middle of our table, despite the low penetration and enjoys healthy competitive environment. The market has low ARPUs, and given the weak economic outlook, BMI does not believe Uganda improve its position markedly in the short to medium term.

Key Trends & Developments

- Uganda's electricity provider Umeme has introduced mobile money payments in conjunction with realtime bank reconciliations. The service will enable subscribers to avoid disconnections that are caused due to delayed payment reconciliations.

- Ugandan mobile operator Warid Telecom has won a tax dispute against the Uganda Revenue Authority (URA). Under the dispute, the URA had asked Warid Telecom to pay UGX3.4bn (US$0.001bn) in tax and penalties on services imported by the operator.

- Uganda's telecoms regulator the Uganda Communication Commission (UCC) has slashed interconnections rates between mobile operators from the current UGX131 (US$0.0521) to UGX112 (US $0.044), with effect from June 1.

- Ugandan subsidiary of South African telecoms group MTN revealed that its staff had stolen UGX9bn (US$3.5mn) by plotting to exploit a loophole in its mobile banking service. MTN subscribers did not lose any funds during the fraud, which occurred during a software upgrade

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