Telecom firms quarterly revenues cross Shs1tn mark

But there was an increase in expenses on input and wholesale services, salaries and taxes

Kampala, Uganda | ISAAC KHISA | Uganda’s telecom sector has posted the highest total quarterly revenues on record, crossing the Shs1 trillion mark amidst the ravaging coronavirus pandemic, according to the latest Uganda Communications Commission (UCC) report.

This is an increase from Shs937bn recorded in the fourth quarter, Shs 858bn in the third quarter and Shs 843bn in the second quarter of 2019, due to an increase in mobile phone subscribers.

The revenues lines, according to the report, included retail and input or wholesale revenues like tower lease sales, international bandwidth, mobile financial services as well as voice and data services.

The growth in quarterly revenues represents a quarter-on-quarter growth of 12% between the fourth quarter 2019 and the first quarter of 2020.

However, within first quarter of this year, the telecom sector revenues continued to grow at an average monthly rate of 3% in the quarter January to March 2020.  For instance, in the month of March, the telecom sector posted Shs361billion in gross revenues from Shs328 billion recorded in the month of December last year.

But the report also notes that while the sector witnessed a Shs6billion drop in monthly revenues between the months of January and February this year, a Shs20billion increase was realised in March this year partly due  to demand arising from the circumstances surrounding the COVID-19 pandemic.

“In this vein, it is worth noting that the share of mobile data with respect to total sector revenues grew by a factor of almost 2%,” the report notes.

The report adds that although total revenues have grown by 10% between December and March, the monthly cost of service has equally increased from Shs230billion to Shs238 billion during the same period under review. This is attributed to increase expenses on input and wholesale services, salaries, taxes, depreciation and other key metrics.

More subscribers

This development comes as the sector mobile phone subscribers from the country’s seven telecom firms grew from 26.7 million active subscriptions in December 2019 to 28.4 million at the end of March 2020. This translates into a total growth of 1.8 million subscribers and a quarter-to-quarter growth of 7%.

Broadband segment has, for the first time posted more than 1 million new connections in two consecutive quarters.

Smartphones and feature phones with basic internet access remain the driver of new mobile internet subscriptions, growing from 23.8 million feature and smartphones in December 2019 to 24.4 million in March 2020.

Similarly, mobile money accounts increased by almost 700,000 new registrations from 24.7 million registered accounts in December 2019 to 25.4 million registered mobile money accounts as a result of an increase in mobile phone subscribers.

The growth in mobile subscriptions during the period also translated into a 10% increase in total domestic traffic. The market averaged 4.58 billion on net minutes per month during the quarter, with an on-net monthly traffic peak in January of 4.7 billion minutes.

Total quarterly on-net traffic stood at 13.6 billion minutes up from 12.4 billion in the quarter October-December 2019.

In relation to outgoing traffic, total international outgoing traffic shrunk from 80.2 million minutes in the fourth quarter of 2019 to 76.2 million minutes in the first quarter of this year, attributed to the shrinking global and travel trade.

International outgoing traffic, according to the report, remains largely destined to the Northern Corridor partner states of Kenya, Rwanda and South Sudan, in which Uganda has special international traffic termination arrangements framework.

On the other hand, total international incoming traffic grew from 110.9 million minutes to 117.8 million minutes during the same period under review. This represents 6% growth in total quarterly international incoming traffic.

“ International incoming traffic largely originates from the Northern Corridor partner states of Kenya, Rwanda and South Sudan, where Uganda has special international traffic termination arrangements (through the One Network Area) framework,” notes the report, adding that  83% of total international incoming traffic was from One Network Area  partner states.

The rest of the world only accounted for 17% of total international incoming minutes into the country, according to the report.

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