Uganda has opened up the telecommunications infrastructure market of the country to full competition, thus ending the exclusivity period that has been enjoyed by MTN Uganda, Uganda telecom and Celtel Uganda over the past six years. The end of the monopoly opens up the telecommunications infrastructure market to full competition, ending the exclusivity period that has been enjoyed by MTN Uganda, uganda telecom and Celtel Uganda for the last six years.
MTN and Uganda telecom held National Telecommunication Operator (NTO) licenses, which allowed them to roll out infrastructure for their use as well as for other operators’ use while Celtel Uganda held the Cellular Telecommunications Operator (CTO).
Meawhile, Celtel by virtue of its license was only allowed to put up infrastructure essentially for its own use. Beside the three companies, there are other players who had been allowed to build infrastructure before the 1996 policy framework.
The infrastructure (i.e. plant, equipment and systems associated with the transmission, reception and switching of telecommunication signals) provisioning will open up to full competition from November 1, 2006.
“For purposes of providing a holistic licensing environment (services and infrastructure), the ministry of ICTs has decided to open up the infrastructure market to full competition,” a document highlighting the proposals on a new infrastructure licensing regime for Uganda reads in part.
Up to the end of the exclusivity period, the main infrastructure providers have been MTN, Uganda telecom and Celtel. The rest of the operators, who had mobile infrastructure, rolled it out for their own use, as opposed to making it available for other users as well.
The five-year exclusivity period that limited competition in basic telephony service, cellular telecommunications service and satellite service expired on July 24, 2005.
The decision to open up the infrastructure market follows the May 2006 ministerial guidelines on telecommunications services provision, which became operational on August 14, 2006.
In May however, the guidelines did not cater for the opening up of the infrastructure provision and for purposes of providing a holistic licensing environment, the minister for ICT has acted by opening up that provision.
Following the new guidelines on infrastructure provision, UCC has prepared a corresponding licensing regime and subsequently licences, which shall be issued to the applicants.
The proposed licensing regime will usher in full competition licensing of infrastructure to increase the capacity of affordable modern infrastructure that will enable the majority of Ugandans to be able to access service within reasonable distances.
UCC argues that the regime, while recognising the progress made by the existing operators in providing infrastructure in Uganda, seeks to increase the penetration of infrastructure further than where it is currently.
The regulator hopes that this will enable the majority of Ugandans, especially those in rural areas to be able to access more affordable communication services.
“Competition is the main avenue that the regime is focusing on to achieve this,” UCC’s executive director, Mr. Patrick Masambu told industry players and members of the public at a workshop in Kampala a week ago.
UCC says the regime takes into account operators who have already made investments relating to infrastructure while seeking to ease entry into the infrastructure market.
In Uganda today, infrastructure already in place can be divided into subscriber loop, national and international infrastructure. In general, there is transmission, switching and access infrastructure.
The 1996 telecommunications policy put emphasis on infrastructure as it was found to be most urgently needed and yet it required substantial investment.
As a strategy to achieve rapid infrastructure roll out, government instituted a period of limited competition of five years, in provision of some key services so as to enable the NTOs sufficient time to recoup their investments.
According to UCC, the exclusivity period yielded positive results because Uganda was able to attract credible investors in the sector to take up two NTO licenses and, the NTOs have been able to roll out infrastructure and services.
However, there has been very little competition in the rolling out of infrastructure as a result of the limitation arising out of the 1996 telecom policy.
During the exclusivity period, the licensing of infrastructure was restricted to two NTOs (MTN and UTL), Celtel and those service providers who had been licensed to set up infrastructure, before the 1996 policy.
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These included Internet Service Providers (ISPs) with International Data Gateway (IDGs), wireless local loop and optical fibre cables and third party network providers (AFSAT).
Present coverage of GSM infrastructure is in 745 out of the total 926 sub-counties in the country, which is equivalent of 80% network coverage when computed on a basis of a sub-county.
All existing licensees that are paid up and have installed infrastructure will be required to migrate to the new infrastructure licensing regime at no cost. The new regime will take into account the unique infrastructure requirements Uganda has.
Source- http://allafrica.com
