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Reflex Eco Group – Uganda News

by Othman Semakula (Ugandan journalist of Daily Monitor)  

This Blog is sponsored by http://www.reflexecogroup.com

Telecoms take on data, as Sms, voice revenues fall

Whereas Uganda’s telecommunications sector has registered massive growth in the last two decades, technological shifts continue to pose key challenges to the sector’s traditional revenue streams including short messaging services (Sms) and voice platforms.

The change is a paradigm shift that currently defines how global telecommunication channels have been affected by a tranche of radicle technological changes.

Globally telecommunication companies are playing catch up as they seek to fend off competition from social networking sites including Twitter, Skype, Facebook and Watsapp.

The above have significantly eaten into telecommunication’s revenues but have helped to upscale internet connectivity most especially using mobile phones.

Whereas there is no particular data to show how technology has eaten into telecommunications’ voice revenues, available figures indicate that text messaging continues to be a major victim of new technology.

For instance MTN Uganda, the country’s largest telecommunications company with about eight million subscribers, reported a significant reduction in voice and Sms revenues attributed to the growing use of social networking sites as alternatives means of communication.

In its half year financial report for the year ended June 30, 2013 the telecommunications giant reported a 14.6 per cent fall in Sms revenue as customers opted for newer data-driven social media platforms to communicate.

However, the drop forms part of the basis upon which telecommunication companies have had to rethink through a raft of measures as they seek to cover up for lost revenue.

In an article published in Uganda’s media recently, Mr Sifiso Dabengwa, the MTN Group President and chief executive officer, said Africa needs to show some sense of urgency so as not to fall behind global technological trends.

He said whereas much of Africa was still struggling to adapt to 3G technology the rest of the world including Europe, Americas and Asia had upgraded to 4G LTE as well as developing prototypes for fifth generation (5G) technology.

He said: “The reality is that mobile broadband spectrum is vital for Africa’s socio- economic transformation and must be taken seriously as a key ingredient in the growth of the continent’s telecommunications’ revenue streams.” 

This, according to Mr Dabengwa means that data is not only the next big thing in the telecommunications sector but Africa needs to take advantage this cheaper and affordable alternative compared to traditional communication models.


For instance MTN Uganda’s financial report indicated that the company had posted significant improvement in internet browsing, thus having a positive impact on the company’s data revenues.

The company reported a 57.4 per cent increase in data revenue assisted by a rapid growth in the use of smartphones especially among the youth.

Currently two in every 10 mobile phone users in Uganda, own a smart phone which is internet enabled and has access to social networking sites including Facebook, Twitter, Watsapp and Skype among others.

The above explains why the company and others in the telecommunications sector have taken radicle measures that seek to invest huge sums of money towards upgrading their data platforms.

Recently telecoms including MTN, Smile Telecom, Orange and Airtel have had a series of ru ups as they seek to upgrade their networks from third generation [3G] to 4G LTE.

According to data from the Uganda Communications Commission, there are about 2.7 million Ugandans accessing the internet through mobile phones with about 98,334 registered on fixed internet.