MTN Internet Will Still Be Costly – CEO

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mtninternet-bundle-codeBrian Gouldie, MTN Uganda’s Chief Executive Officer, at his first media briefing on Thursday said that internet infrastructure is currently still underutilized in the country, making it risky to their investment if they reduced prices further.

On average, according to Freedom House, Ugandans spend 1,000 Shillings for 30minutes to access the internet in a cybercafé.

A cost still considered high, even with at least 50 internet providers according to the Uganda Communications Commission (UCC) 2013 report. Internet costs have indeed been dropping since 2008, but at a much slower pace, even with more players and the landing of the much faster fiber optic cable from the Port of Mombasa.

Brian Gouldie, MTN Uganda’s Chief Executive Officer, at his first media briefing on Thursday said that internet infrastructure is currently still underutilized in the country, making it risky to their investment if they reduced prices further.
Gouldie was speaking to the media for the first time since he secured the MTN Uganda CEO job replacing Mazen Mroue, who moved to MTN Irancell. Figures provided by the UCC point to internet penetration of just 18percent of the population. UCC estimates that of the 6.4percent of internet users, at least half use mobile handsets to access the internet.

When Uganda hosted the E-learning Africa Conference in June 2014, it was noted that some of the limitations to access to the internet were high cost of mobile handsets, laptops and high infrastructure costs.

Gouldie, a founding member of the MTN Group in 1994, pointed out that the presence of old handsets that are not internet-enabled, still limits growth of data usage. Smartphones, which are an option, are also still highly priced. This is not helped by the excise duty and Value Added A Tax on mobile handsets.

On Monday this week, Microsoft unveiled three Nokia Lumia mobile handsets as it attempts to tap both the high and low end market segments. Samsung, Techno and Huawei are other companies, aligning themselves with telecoms to provide discounted handsets to customers.

On the poor quality of service in the telecom sector, which most telecoms have failed including MTN – at least until the August 2014 UCC report, Gouldie said companies were taking on more than their network could handle. He said investment in reducing dropped calls, unsuccessful calls, poor quality of calls and blocked calls among others has not matched the rising customer numbers.

Airtel in particular has fallen back in terms of quality. Ever since the acquisition of Warid Telecom in 2012, the latest Quality of Service places it as the worst. Airtel Uganda officials tell us that the transition process takes time, hence the increased dropped calls.

MTN Uganda has also been dragged to court over unsolicited text messages – an industry-wide problem affecting users.

On mobile money, Gouldie also revealed that the services will be interrupted for two days between September 20th and 22nd, due to an 18 billion Uganda Shillings system overhaul.

MTN Uganda currently leads the pack in mobile money services, and this interruption will see customers unable to use the service. Daily transactions on MTN Mobile Money alone are estimated at one million and over 30 million per month.

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