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Status of the Communications Market – March 10
Jan – Mar 10 2
The Telecommunications Sector at a Glance
Mar - 09 June - 09
Sept - 09
Dec – 09
Mar - 10
PIP 22 23 25 25 26
PSP Voice and Data 32 31 32 36 37
PSP Capacity Resale 5 3 7 8 9
Fixed Lines 210,655 213,820 213,600 233,533 244,455
Mobile Subscriptions 9,801,173 9,464,979 9,529,293 9,383,734 9,992,705
Tele-density 32.61 31.57 31.78 31.37 32.21
Number of Payphones 65,669 71,673 79,896 94,896 96,890
The Macro Performance
Consumer Price Index Annual inflation dropped to 7.5%
from 11% in the previous quarter. The drop in overall inflation was
primarily the result of price drops in food and clothing following the Christmas peak during the preceding quarter.
In the transport and communication sector, CPI dropped to 9.3% from 12 % in the previous quarter . The increase in competition in the sector has had a downward push on telecommunications prices in the country.
Jan – Mar 10 3
Mar-09 Jun-09 Sep-09 Dec-09 Mar-10
14.1
12.3
14.6
11
7.5
10.3 10.5
13.7
12
9.3
Annual CPI Change (March '10)
Annual CPI % change Transport & Communication
Macro Performance Conti.
Tax Contribution Shs 55 billion was realised in
the tax revenue during the period Jan – Mar 2010 compared to Shs 39 billion collected during the same period 2009.
The tax comprised of;
- Shs 23.8 billion in Excise
- Shs 25.7 billion in VAT
- Shs 5.7 billion in PAYE
Jan - Mar 104
1Q09
2Q09
3Q09
4Q09
1Q10
39,151,908,882
42,585,579,094
47,942,938,939
53,524,871,835
55,148,974,620
Telecom Tax Revenue
A reduction in underlying prices for telecommunication services has resulted into more usage and revenues for government, underlying the positive correlation between price and uptake of service. A reduction in the usage tax(currently at 30% )should generate more volumes of usage and consequently yield higher revenues for Government.
Macro Performance Conti.
Total turnover from the sector (Post and communications) increased by 14% to 1.2 trillion shillings during the year 2009.
This is a slow down compared to 2008 when turnover rose by 24%.
Operators are driven to lower their prices as the market gets more competitive. This is consequently having a squeeze on their margins and therefore the ability to grow their revenues.
Jan - Mar 10 5
2005 2006 2007 2008 2009
538,840,114
621,656,625
839,205,933
1,045,355,815
1,194,728,119
Telecom Revenues, UGX 000
Revenue Contributions per Service
Mobile voice services (Prepaid and post paid) dominated gross earnings accounting for more than 50% of turn over.
There was jump in revenues from data and internet services, accounted for an estimated 15% of gross earnings.
The commendable growth in the growth of data services is the result of increased mobile data penetration enhanced by the introduction of 3G data services by the all the telcos.
International access via the high capacity fibre link networks at the East Africa coast is facilitating growth of data market in Uganda
Jan – Mar 106
Communications Infrastructure
Private Sector Initiatives
Consistent with the previous two quarters, there has been a contraction/ slowdown in the roll out of BTS as infrastructure sharing takes root.
Sharing is however still primarily limited to passive network elements with no known sharing of active elements to date.
By March 2010, only 10 BTS were added making it a total of 2890 BTS country wide.
We predict that future additions in BTS shall be in the form of in house coverage boosters as opposed to the traditional mast mounted antennae
Jan - Mar 10 7
Fixed Telephony Market
Fixed Subscriptions
There has been a resurgence in the fixed line market over the past two quarters of December and March 2010.
A total of 30,555 new fixed line connections were registered during the two quarters.
This growth has resulted into a national fixed line penetration of 0.77 lines per 100 persons.
Jan – March 10 8
Mar-09 Jun-09 Sep-09 Dec-09 Mar-10
210,655 213,820 213,600
233,533
244,455
Year on year Fixed Telephony Subscriptions
Fixed Line Distribution
Jan – Mar 10 9
Like in the preceding quarter, new growth in the fixed line market is predominantly in the form of fixed GSM and Wimax Terminals
By the end of March, Fixed cellular terminals accounted for 39% of total fixed lines compared to 36% market share at the end of 2009
CDMA and Copper wire line share of the fixed line market is at 37% and 27% respectively.
FCT (GSM & Wimax)
39%
WLL0%
Fibre3%
CDMA37%
Copper21%
Fixed Line Distribution, Mar -10
Mobile Subscriptions
608,971 new mobile subscriptions were realised in the first quarter of the 2010.
This translated into a quarter to quarter growth of 6.5% compared to the sub zero growth of -1.3% realised in the preceding quarter.
The increase in number of subscribers translates into a cellular network penetration of 31.4% lines per 100 persons.
Jan - Mar 10 10
1Q09 2Q09 3Q09 4Q09 1Q10
9,865,446
8,876,702
9,529,293
9,383,734
9,992,705
Mobile Subscriptions, March 2010
Mobile Subscriptions Vs Penetration
Jan - Mar 10 11
Mar-09 Jun-09 Sep-09 Dec-09 Mar-10 8,400,000
8,600,000
8,800,000
9,000,000
9,200,000
9,400,000
9,600,000
9,800,000
10,000,000
10,200,000
10,400,000
28.00
29.00
30.00
31.00
32.00
33.00
34.00
10,076,101
9,090,522
9,742,893 9,617,267
10,238,000
32.86
29.65
31.78 31.37
32.21
Subscriptions Teledensity
It is worth noting that mobile penetration has fluctuated at 30% over the past year with no significant changes as witnessed in the previous years. This may be a sign of market saturation in mobile market or may necessitate for a trigger to revamp the market.
Subscription Growth and Penetration rates
1Q09 2Q09 3Q09 4Q09 1Q10
15.3
-9.8
7.2
-1.3
6.5
32.6
31.631.8
31.432.7
Subscriber Growth Rates and Penetration, March 2010
Growth Rate Penetration
Jan - Mar 10 12
Traffic Trends
The industry realised a 29% increase in domestic and outgoing international traffic combined for fixed and mobile voice services.
This is Commensurate with the increase in mobile and fixed subscriptions as well as a reduction of prices for these services.
On net traffic still accounts for the lion share of domestic traffic at 88%, a reflection of the current pricing structure where calling on net is considerably cheaper than calling off the network.
Jan – Mar 10 13
3Q09 4Q09 1Q10
1,380,431,465 1,290,255,788
1,740,656,751
218,586,509 201,387,161 202,434,090
25,642,001 23,406,188 25,225,869
Telephone Traffic, 3Q09 - 1Q10
On net Off net Intnl Out
Traffic Distribution
Jan – Mar 10 14
On net88%
Off net10%
Intnl Out1%
Traffic Distribution, 1Q10
On net85%
Off net13%
Intnl Out2%
Quarterly Traffic Distribution, 4Q09
SMS Traffic
There was a growth in SMS traffic of 28% in the first quarter of 2010. This was largely due to the increased SMS usage campaigns by cellular operators. Growth in the previous quarter had been only 4%
On net SMs again dominated the SMS market accounting for 81% of all SMSs sent .
Off net SMS accounting for 16% of SMSs.
Jan – Mar 10 15
3Q09 4Q09 1Q10
97,632,941 103,296,812
142,029,761
27,023,680 25,404,601 28,291,548
8,275,486.00 9,406,964.00 5,887,623.00
SMS Traffic
Onnet Offnet Intnl
SMS Distribution
Jan – Mar 10 16
Onnet 75%
Offnet 18%
Intnl7%
SMS Distribution, 4Q09
Onnet 81%
Offnet 16%
Intnl3%
SMS Distribution, 1Q10
Tariffs
Tariff related highlights during the quarter included;
Orange’s Gyekiri becoming a permanent offering,
The review of Orange’s international roaming rates (24th Feb 2010)
The review of Orange’s domestic and international rates (1st March 2010)
The launch of Warid’s Pepeya promotion
The revision of Pakalast Daily rental from 1000/- to 1500 and the 2 hour usage fee of 500/-
UTL on net bonus promotion MTN’s revised Voice SMS
promotion (Feb 2010) Conclusion of MTN’s goal of
Goals promotions
Jan – Mar 1017
UTL - Xtra MTN - Pay Go Std
Warid - Per Min
Orange - Per Min
Zain - Per Min
310
340329
290
400
290 285275
300
On net Standard Profile Tariff Compar-ison, July 2010
Peak (8 am - 8pm) Off Peak (8pm - 12 am)
Per Second Profile Comparisons
Jan - Mar 10 18
UTL Vibe MTN - Per Sec
Warid - Per Sec
Orange - Per Sec
Zain - Chacha
9
8 8
7
8
6
8 8
7
8
Onnet Per Second Tariff Rate Comparison, July 2010
Peak Off Peak
UTL Vibe MTN - Per Sec
Warid - Per Sec
Orange - Per Sec
Zain - Chacha
12
11
10
9
11
12
11
10
9
11
Off net Per Second Rate Compar-ison, July 2010
Peak Off Peak
Payphones
By the end of March, there were 96,980 payphones countrywide. These were in the form of both vendor operated as well as card/coin operated phones.
This translates into a payphone access of at least a payphone for every 100 inhabitants
The drop in rate of growth may be indicative of the fact that the industry is slowly realising universal payphone access.
Jan – Mar 10 19
Mar-09 Jun-09 Sep-09 Dec-09 Mar-10 -
20,000
40,000
60,000
80,000
100,000
120,000
-
1.00
2.00
3.00
4.00
5.00
6.00
7.00
Payphone Growth & Penetration, 1Q09 - 1Q10
Payphones Payphone per 500
International Bandwidth
The period 1Q10 has seen an actual realisation of the undersea cable systems at the East African coast.
By the end of March 2010, total international bandwidth had risen to 3,640.94 mbps from 2,020 mbps at the end of Dec 2010 of which; 1,650 mbps is uplink and 1,990 mbps was downlink
bandwidth 80% of the available bandwidth is
provided by the two cable systems (TEAMS and Seacom).
Jan – Mar 10 20
Dec-09 Mar-10
850.00
1,650.27
1,200.00
1,990.66
International Bandwidth, Mar 10
Uplink (mbps) Downlink (mbps)
Mobile Internet Access
Subsequent to new growth in international bandwidth has been a jump in overall internet connectivity.
The mobile broadband segment has again continued with its impressive growth posting 460,000 active accounts at the end of March.
Mobile connectivity has become the dominant internet/ data solution in Uganda, just as it was in the voice market.
Jan – Mar 10 21
Jun-09 Sep-09 Mar-10
310,056
358,228
468,608
Mobile Wireless Internet Subscrip-tions, Mar 10
Mobile Internet Access
The growth in mobile broadband access and usage is the result of;
- Increasing 3G coverage
- Dropping bandwidth prices
- Dropping handset and modem prices.
By the end of March, the average mobile access price per kb was 1.8/= (the chart on the RHS shows comparative rate comparison of bandwidth pricing)
Jan – Mar 10 22
UTL Warid Zain MTN Orange
2 2.048
1.3
2.5
0.9
Comparative GPRS/WAP Web Browsing Rates, Mar 2010 (UGX)
Price per kb Uploaded or downloaded
Jan – Mar 10 23
POST AND COURIER SERVICES
Post and Courier Licensees
The following companies were issued domestic courier licenses;
United Local Courier M & A Express Ltd
No new Regional or international Courier licenses were issued.
The table on RHS shows the total number of licensed service providers per license category
June 09
Sept 09
Dec 09
Mar 10
Major Postal Operator
1 1 1 1
International Courier
6 6 7 7
Regional Courier
8 8 8 8
Domestic Courier
8 10 13 15
Jan – Mar 10 24
Post and Courier Access Courier Access
Unlike in the preceding quarter, there has been no infrastructure additions in the postal segment.
However there has been an estimated 20 new courier access/ drop points resulting from entry of new providers and expansion of some domestic incumbent providers.
Postal Access
Indicator Sept 09 Dec 09 Mar 10
Number of Permanent Post offices
331 334 334
Number of post offices with money order services
103 103 103
Post offices offering public internet services
1 21 21
Private letter boxes
78,457 79,417 79,417
Courier Access Points (Est)
280 300 320
Jan – Mar 10 25
Domestic Postal Traffic Trends
Following the postal season peak of Nov – Dec, there was a 71% drop in domestic letter post during the 1st quarter of 2010.
On the other hand, 30,605 domestic items were handled during the same period translating into a 6% quarter to quarter growth.
Jan – Mar 10 26
3Q09 4Q09 1Q10
621,051
762,255
213,689
22,040 28,920 30,605
Domestic EMS and Letter Post Vols, 1Q10
Domestic letter post Domestic EMS
Domestic EMS &Letter post Volumes Select Foreign Letter Post Volumes
Jan – Mar 10 27
Monthly Postal Traffic, 1Q10
Jan-10 Feb-10 Mar-10
91,857
22,045
99,787
12,020 9,680 8,905
Monthly Domestic Postal Traffic, 1Q10
Domestic letter post Domestic EMS
Jan-10 Feb-10 Mar-10
4,280 2,557
568 407 424 436
68,668
18,161
37,849
8,626 8,534 10,253
Select International Postal Traffic, 1Q10
East African Letter post Incoming East African Letter post Outgoing
European Letter post Incoming European Letter post Outgoing
Jan - Mar 10 28
Broadcasting
Status Mar 09 June 09
Sept 09 Dec 09 Mar 10
Radio On 192 192 192 195 196
Off 30 30 32 33 34
Total 222 222 224 228 230
TV On 35 35 40 40 40
Off 15 15 15 15 16
Total 50 50 55 55 56