The telecom market in Uganda generated $638m in 2009, almost exclusively through mobile services. Fixed broadband services is expected to join the mobile segment as a strong driver of growth as the new undersea cables land in the coasts of East Africa and the terrestrial fiber rings start reaching the landlocked country. Uganda is predicted to grow at an impressive CAGR of 11.5% over the next five years, reaching $1.23bn by 2015, according to a new report from Pyramid Research.
The Ugandan mobile market is highly competitive, but the low level of mobile penetration at 32.8 percent in 2009 indicates that there is still much demand to be fulfilled. "The main obstacle to increasing penetration has been the provision of affordable last-mile access to rural areas, where the majority of the Ugandans live and where income levels are too low to justify individual subscriptions and handset ownership. However, forms of centralization are emerging to solve this problem," says Kerem Arsal, Analyst at Pyramid Research and author of this report. "We expect mobile subscriptions in Uganda to double during our forecasting period and grow from 10.7 million in 2010 to 20.9 million in 2015, with a penetration rate of 52.7 percent," he adds.
The real opportunity, however, lies in the broadband segment. "Data revenue and adoption in East Africa will grow fast with the decline in the costs of international bandwidth due to the new undersea cables," indicates Arsal. Adding to this the unfulfilled demand for Internet, the broadband market will comprise a quarter billion dollars in 2015. Fixed broadband will be the primary source of revenue growth in Uganda and will generate US$229 million in 2015.
Source: Cellular News