Uganda’s telecom companies have invested heavily in infrastructure services to boost internet access but the low users have limited their ability to lower internet costs for their customers including the Small and Medium Enterprises.
This comes two months since Members of Parliament urged telecommunication service providers to adopt friendlier data and voice bundles.
“Uganda Communications Commission should also enhance engagements with the telecommunication operators to develop and provide a broad range of bundles that will encourage customers to access the internet and call subscriptions,” Moses Magogo, the chairperson of the Committee on ICT and National Guidance told Parliament.
State Minister for Information and Communication Technologies, Joyce Nabbosa Ssebugwawo, said during the Fintech Landscape Exhibition recently that the government is working with partners to achieve seamless internet connectivity that will drive down the cost of internet.
“We are working with partners towards seamless internet connectivity and affordability of internet data,” she said, adding that affordable internet has partly been achieved even as more still needs to be done.
Enid Edroma, the general manager, Corporate Affairs at MTN Uganda says only about 35 percent of their customers are using smartphones.
“We are also using only five percent of our underground internet cables yet the operational costs remain the same,” she said.
Edroma says an increase in internet users will drive down the price of the internet and consequently stimulate digital activities that are now rekindling hope for Small and Medium Enterprises (SMEs).
Currently, Uganda’s internet penetration stands at merely 29.4 percent compared to Tanzania’s 38 percent and Kenya’s 53 percent.
But the government has been reluctant to review tax policies to stir up internet access.
For instance, the government charges a VAT of 18 percent, an excise duty of 12 percent on new imported mobile phones as well as other taxes on the internet, a move industry experts say has slowed down access to internet-enabled devices especially smartphones which would have ideally increased internet access and driven down internet costs.
However, industry experts say in order to support telecommunications industry initiatives and make internet services more accessible and affordable to customers, the government needs to take some appropriate steps.
These include; a reduction in import duties on smartphones to lower overall prices for prospective customers, especially those in the rural areas as well as assign more spectrum to telecom companies to support a new technology that would easily translate into a reduction of cost in operations and prices.