KAMPALA – Mobile and fixed telephone subscription has continued to be the engine for growth in the communications sector with the market hitting 29 million in the third quarter of 2021.
However, in terms of net quarterly additions, only 200,000 new subscriptions were posted in the three months July-September 2021, according to the latest market performance report released by Uganda Communications Commission (UCC).
This figure is only a third of the net quarterly subscriber additions witnessed in the preceding two quarters, an indication that the new COVID-19 related demand associated with the last four quarters might be easing off.
The quarterly report indicates that despite the slowdown in quarter-on-quarter additions, the 12-month period ending September 2021 recorded a decent 10% year-on-year growth, with 2.6 million new customers added to the network.
The 29.1 million subscriptions translate into a telephone penetration of 69%, which can be interpreted as a national penetration of 7 lines out of every 10 Ugandans (regardless of age).
It is also noteworthy, the report points out, that 85% of the 200,000 new mobile connections during the third quarter, were data-enabled connections.
This high broadband connectivity conversion is reportedly driven by the continued shift to data-enabled low-cost entry terminals pushed by both Mobile Network Operators and independent handset importers.
It is, therefore, not surprising that at the end of September 2021, total internet subscriptions had for the first time crossed the 22 million mark – a broadband penetration rate of 52%. That means every 1 in 2 Ugandans has an active internet connection.
On a year-on-year comparison, the upward trend in broadband connections matches the fixed and mobile subscriptions, with the broadband subscriptions base growing by 1.9 million (10%) between September 2020 and September 2021.
Growth in mobile subscriptions also had a multiplier effect on mobile money accounts, with the total number increasing by 900,000 accounts during the quarter. At the end of September 2021, the total number of registered mobile money accounts stood at 32.3 million.
Indicative of a sustained increase in business activity that is gradually positioning the mobile as a financial tool, the number of active mobile money agents grew by 11%, from 285,371 in June 2021 to 315,895 by the end of September 2021.
Going by a year-on-year analysis, the agent footprint across the country grew by 39%, with over 88,000 mobile money agents joining the Digital Financial Services (DFS) eco system over the last 12 months.
As for domestic voice traffic, the number of minutes grew to 16.8 billion in the period July-September 2021 – almost 1 billion minutes more than domestic traffic volumes recorded in April – June 2021.
“This 6% domestic traffic growth represents the highest quarter-on-quarter domestic traffic growth in the last 12 months (four quarters),” the report stated.
Regarding international voice traffic, there was a reduction of 10 million minutes in total calls to and from Uganda during the three months ending September 2021. This drop from 127 million minutes in 2Q21 to 117 million minutes in 3Q21 is consistent with the international traffic contraction realised over the last 12 months.
The contraction in international traffic has been attributed to traffic migration to Over-The-Top (OTT) calling platforms, as well as restrictions in international travel that translated into a slow-down in global business and related communication during the period under review.
Acknowledging that this period coincided with the second COVID-19 lockdown, the report notes a spike in broadband traffic, which it attributes to learners and employees adopting online working methods.
The total broadband traffic grew to 100 billion MBs, up from the 69 billion MBs recorded in the second quarter (April-June). This is the first time more than 100 billion MBs have been downloaded in a single quarter, the report observed.
Turning to broadcast, the report indicates that by the end of September 2021, 40 free-to-air TV stations were carried on SIGNET, the Government-owned platform that delivers free-to-air television.
On the other hand, the Pay TV market, which is served by a combination of satellite, cable, and digital terrestrial networks, saw a slight contraction in total active subscribers – from 1.60 million as of June 2021 to 1.54 million in September 2021.
This has been attributed to the seasonal subscriber contraction in July – September, which has been consistently observed over the last three years.
Elsewhere, the period under review witnessed the rolling out of the Electronic Government Procurement System (eGP) in eleven selected entities as a pilot project.
The eGP is a web-based tool that has been introduced to facilitate effective and efficient public procurement and disposal. Using ICT, the tool conducts end-to-end Government procurement and disposal online. The Government plans to roll out the programme at all Ministries, Departments and Agencies within the next three years.
Another innovation worth noting is the Eurogiro Financial Supermarket launched by Uganda Post Limited (UPL) in partnership with EUROGIRO. The platform facilitates financial services such as mobile money transfers, agency banking and international money transfers.
The Eurogiro Financial Supermarket is an open payment platform that empowers postal organisations to actively engage in financial services, both locally and globally. Eurogiro, whose key objective is to ease cross-border financial transactions and business, hosts key players in the DFS ecosystem such as MoneyGram, Mobile Money, Western Union, and World Remit.
“The platform will enable clients to send and receive money to over 200 countries using a simple, reliable, swift, and convenient platform, which will help in bridging the financial gap between rural Uganda and the digital world,” said the report.
The Postal and Courier sector continued to witness a wave of mobile applications during the quarter, with different players in the ecosystem leveraging digitization to improve efficiency and consumer experience.
Mobile applications that have stood out include Godel Delivery App, DHL’s Africa e-shop and Sail Courier App, among others. With the Sail Courier App, a last-mile delivery application that enables clients to click and request for delivery of items to their homes, one can easily register to be a courier agent.
“This wave of innovation in the Post and Courier segment reflects the ease of entry into the Post and Courier markets in Uganda, which has over 30 different players,” the report says.
“As such, consumers have a wide variety of products and services to choose from, which has, in turn, led to efficiency, productivity, and competitiveness in the industry.”
On the global scene, the report highlights TikTok’s sensational rise to prominence, pointing out that the video-sharing application has now crossed the 1 billion monthly active user mark for the first time. This apparently makes TikTok only the second social media platform with more than a billion monthly active users, the other being Facebook and its associated sub-platforms (WhatsApp and Instagram).
However, TikTok has had to contend with criticism for the addictive nature of the profiling algorithms used by the app, and legal challenges for non-compliance with data protection rules in the European Union.
The UCC market performance report provides a quarterly local and global communications market overview that seeks to help industry actors, prospective entrants, Government, and other stakeholders to keep up to date with trends and developments in the sector. Find the full report at Link: https://www.ucc.co.ug/wp-content/uploads/2022/01/UCC-3Q21-Report-compressed.pdf
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