Internet mobile data is King in Uganda and why ISPs should care

SIM in Uganda black

[blockquote right=”pull-left”]
[/blockquote]You’ve heard , watched or read about them priding themselves as the “Kings of bundles“, “Smartphone network“, “Network for Smartphones“, the list goes on but alas a landscape you cannot overwhelmingly vote for one for being the true Internet mobile data king. Most mobile carriers are riding on data as their next growth frontier given the dwindling revenues from traditional avenues of voice and text. The smartphone wave is just catching up also which exhibits potential areas of exploitation.

Over the top (OTT) services like Facebook, YouTube, WhatsApp, etc are making a killing in Uganda and their effect is being felt and reflected in financials of these big telcos. These ride on the data infrastructure provided by the telecoms. No wonder MTN’s South African arm and many across the world have come up to petition regulators to delve deep into these OTT that ride high on their infrastructure, make gargantuan revenues– whereas the telcos are left with leftovers to feast on.

However such pleas will take a considerable amount of time to get rectified given how cheap OTT services have proven to be compared what’s at disposal from the big yellows, big reds, oranges and blues of this country.

FROM OUR SPONSOR- Continue for more content

So when a story ran about Google teaming up with the GSMA consortium about a global messaging service riding on their networks, it came as no surprise given the innovation driven by our beloved OTT services which instead threatens telecoms.  Whatsapp made rounds over its short-lived shut down in Brazil. Reason?  Brazilian telecoms weren’t profiting as much as they would wish to since users preferred communication over the air to voice and SMS.

How can telecoms profit from data?

Internet mobile data is King in Uganda and why ISPs should care

For now, mobile carriers act as pipelines through which data passes to the end-user and only make a return off our periodic subscription to networks. How can they perform better than just being a gateway is one thing they should keenly look at.

Data is the future and we believe sober-minded think tanks can’t object to it. However much it currently lags behind voice revenues for some telecos, it’s uptake together with mobile money and gains make up for the losses on the other side of the spectrum. In other words it’s one-sided that voice losses are inversely  proportional to data gains. But this is not for certain.

An average Ugandan Internet user normally consumes photos and texts, a downturn for ISPs who charge per volume consumed (given the above consume less data as compared to video) and at the end of the day, ISPs register meager earnings. Add that to less subscriptions to voice keeping other factors constant, hence the low average revenue per user (ARPU). I suggest video should be their next growth hack owing to the fact that it takes up a large chunk of data and like metrics suggest, video consumption is on an upward spiral. That’s why YouTube ranks third after Google and Facebook on the most visited websites in Uganda. Phrases like Netflix & chill are everyday vocabulary(very few can decipher it btw). So carriers, can we see some data plans in the future crafted around these new data hogging services like Netflix?

Whereas Airtel is struggling with their Airtel TV app and MTN experimenting with video offerings (at least in Nigeria), its high time they raised their sleeves and offered us compelling packages from which we can choose from. This can only be achieved with good content (local I must add)  and a big budget for PR to get netizens jump along this upward shift and of course robust networks.

This however won’t be achieved over the continued deterioration of service registered by a few big guns in the Ugandan telecom space. They need to increase their investments to keep up with the growing data demands plus also upgrade their slow networks which can accommodate the influx of users not just for video, but also other large volumes of data taking off.