After receiving its mobile telecommunications licence from the Ugandan Communications Commission (UCC) last month, Hits Telecom will inject $150 million into building its network, says CEO Edwin Rowell.
Middle East and African Investment Company, through its subsidiary Hits Telecom Uganda, was awarded a public infrastructure and public service provider licence in the east African country, after five months of talks with the UCC.
This licence is a full GSM 900/800 spectrum licence, which includes broadband, international gateway, mobile virtual network operator, data transmission and WiMax, Rowell explains.
The company is the fourth licence-holder in the country after Celtel, MTN and Uganda Telecom (UTL).
Hits Telecom will quickly move forward with broadband and GSM solutions, which will be operational by November, says Rowell.
"We will invest a further $50 million in 2008 to build on the network, stipulated in our licence capabilities."
Under pressure
Rowell points out the need for improved quality of service within the Ugandan telecoms market. At the moment, subscribers experience dropped calls, which puts strain on the communications industry. "There is necessity for competition in the market, in order to increase quality of service and lower calling rates."
Hits Telecom hopes to lead reduced call charges through increased competition, he says. "With added telecoms players, we expect to see mobile telecoms subscribers grow to around five million, in the next five years."
There are only 2.4 million Ugandan mobile subscribers in a market of around nine million people, says Rowell. The mobile telecoms penetration rate in Uganda is 6%.
Market analysts say MTN's share of the market stands at about 1.5 million, Celtel at 400 000 and UTL at 700 000.
The Ugandan government recently liberalised the telecoms market in the country, encouraging more players to enter the field, Rowell says.
Abu Dhabi-based Warid Telecoms is expected to receive the fifth telecoms operating licence next month, according to market reports.
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