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Uganda Telecommunications Report Q2 2014 - New Market Study Published

Fast Market Research recommends "Uganda Telecommunications Report Q2 2014" from Business Monitor International, now available


Boston, MA -- (SBWIRE) -- 04/11/2014 -- The opportunities and limits to growth in Uganda's mobile market are both related to its low penetration rate, which BMI estimates reached around 49% in 2013. Although the low penetration rate means there remain considerable opportunities for organic growth in Uganda's mobile market, these are limited by poor network coverage in rural areas, where most Ugandans live.

Very low ARPUs, driven down during price wars in 2010 and 2011, are encouraging operators to target wealthier urban subscribers with higher-value data services, supported by investments in 3G and 4G mobile data networks, rather than expand networks to underserved rural areas. Despite operators' limited investments in network expansion to underserved areas, BMI has a positive growth outlook for Uganda's telecoms market, supported by our forecast of average annual private consumption growth of 7.8% between 2014 and 2018.

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Key Data

- Mobile market growth was estimated at 6% for 2013, affected by the implementation of SIM registration requirements in September 2013. We forecast a return to stronger growth, of 11%, during 2014.
- ARPUs estimated to have risen marginally in 2013, but remain very low, at UGX7,731 (US$3.10).
- Broadband connections are estimated to have increased by 46% year-on-year to 306,000 in 2013, though from a low base.

Risk/Reward Rating

Uganda climbed one place into 14th position in BMI's latest RRR table with an aggregate score of 41.3 out of 100, up from 40.3 in the previous quarter. Uganda continues to outperform many of its peers in the country risks category, which reflects a positive real private consumption growth outlook during our fiveyear forecast period to 2018. Uganda also scored above average in the Industry Rewards category, as a penetration rate below 50% means its mobile market is likely to continue rapid growth throughout the whole of our forecast period.

Key Trends And Developments

Uganda's fixed broadband sector has begun to attract increased investment. In November 2013 Google launched Project Link, which involves building a metro fibre network in Kampala, and in January 2014 MTN announced that it had expanded its fibre network in Uganda by 350km in 2013, bringing its total fibre backbone to 3,150km.

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