communication sector performance report quarter ending

Communication Sector Performance ReportQuarter ending December 2018

Sector Performace December 2018 PAGE 3

Contents

Legal Disclaimer Broadcast

Introduction Post & Courier

Sector at a glance

Mobile

Internet

Mobile Money

Legal Disclaimer

The information and figures contained herein were obtained from licensees’ submissions to the Commission and other sources available to the Commission. It is intended to provide a communications market overview to the industry, prospective entrants, government, academia and other stakeholders. UCC does not give any kind of warranty and may not be liable for the interpretation arising from its use or misuse.

Legal disclaimer on the submissions

Broadcast data and compilations for 2018

This is a review of the industry performance, trends and key developments for the quarter covering the period October to December 2018.

Post and courier data and compilations for 2018

Key indicators from first quarter of 2018

Sector data on mobile use from quarter one 2018

Sector data on internet use from quarter one 2018

Mobile money data and compilations for 2018

03 26

04 31

05

06

18

23

Sector Performace December 2018

Introduction

This is a review of the industry performance, trends and key developments for the quarter covering the period October to December 2018. Reference periods marked with asterisk (*) implies estimates. It covers;

The sector at a glanceThe mobile and fixed marketsCommunication TrafficInternet & OTT servicesThe sector contribution to Tax RevenueThe communication infrastructureMobile Financial services (Mobile Money);The Broadcasting servicesThe Postal marketProduct and pricing movements in the industry


uganda’s communications sector at a glance KEY INDICATORS Q1 2018 Q2 2018 Q3 2018 Q4 2018

Mobile Subscriptions 24,024,925 23,701,960 23,135,037 24,388,744Fixed Lines subscription 260,447 252,165 170,534 186,724Teledensity (%) 62 61 60 63Internet subscription (Mobile) 10,420,126 9,855,034 13,569,354 14,360,847Internet subscription (Fixed) 9,974 10,273 8,868 9,485Internet penetration (%) 27 25 35 37Estimated Internet users 15,729,929 14,885,281 20,442,711 21,636,121PSP Voice and Data Licenses 33 31 33 33PIP Licenses 23 22 22 22No of operational TV stations 33 33 33 40No of Pay TV service providers 8 8 8 8Active Pay TV Subscriptions 1,198,398 1,469,129 2,165,293 2,188,233No of FTA vendors 28 28 28 28No of postal and Courier service providers

20 20 20 19

Population Est: 39,041,200 (UBOS)


Quarterly trend in tele-density, mobile and fixed subscriptions

For the period Q3 to Q4, the mobile subscription grew by 5.4% and the fixedsubscription grew by 9.5%resulting into a teledensity of 63%. Thus reflecting acontinuous organic growthin the usage of both mobile and fixed services in Uganda.

260,447

Q1 2018 Q2 2018 Q3 2018 Q4 2018

5,000,000

- 59

60

60

10,000,000 61

61

20,000,000 62

25,000,000

30,000,000

TeledensityFixed

Mobile subscription

62

63

63

64

23,135,037

24,024,925

24,388,744

252,165 170,532 186,724

62

61

60

63

23,701,960


Mobile market competitiveness

The downward trend in HHI implies increasing mobile market competitiveness.

Herfindahl Hirshchman Index (HHI)

4600

4500

4400

4300

4200

4100

4000

3900

3800

3700

3600Q4 2017 Q1 2018 Q2 2018 Q3 2018 Q4 2018

3936.3 3942.0

4477.1

4201.9 4159.5


On-net & off-net voice traffic

The On net voice traffic dominates the voice traffic market. This is because Uganda is currently an on net market due to significant variances of the onnet pricing. The on net traffic grew by 17.4% and the off net traffic grew by 4.4% in the period Q1 to Q4 2018.

13,500,000,000

13,000,000,000

12,500,000,000

12,000,000,000

11,500,000,000

11,000,000,000

10,500,000,000

10,000,000,000

160,000,00013,258,993,313

12,088,114,192

11,775,613,813

11,293,092,924

158,000,000

156,000,000

154,000,000

152,000,000

150,000,000

148,000,000

146,000,000Q1 2018 Q2 2018 Q3 2018 Q4 2018

Off net traffic (voice)

On net traffic (voice)

150,983,526

152,327,575

158,111,462157,690,128


ONA traffic

There’s more incoming voice traffic from ONA Countries than outgoing traffic. However, the incoming voice traffic dropped by 22% and the outgoing voice traffic grew by 15% in the period Q3 to Q4. ONA off net originating P2P SMS traffic grew by 0.6% ) and the Off net terminating P2P SMS traffic grew by 1.6% in period Q3 to Q4.ONA countries are Uganda, Kenya, Rwanda and South Sudan.

ONA VOICE TRAFFIC ONA P2P SMS TRAFFIC

Incoming voice traffic (minutes) Off-net originating P2P SMS

Outgoing voice traffic (minutes) Off-net terminating P2P SMS

155,840,946

88,503,429

122,189,134

102,133,911

2,834,766 2,850,581

2,192,5402,158,297

Q3 2018 * Q4 2018 Q3 2018* Q4 2018


International voice traffic

The international incoming voice traffic grew by 1.7% and the international outgoing voicetraffic dropped by 1.3%.

International traffic voice incoming (Excluding ONA)

International traffic voice outgoing (Excluding ONA)

24,823,107

18,422,991

25,250,741

15,968,957

Q3 2018* Q4 2018


Q1 Q2 Q3 Q4Levy on Excise Duty (LED) 83,428,012,295 88,388,395,976 143,557,281,268 172,537,407,051Pay As You Earn (PAYE) 86,717,880,203 100,955,552,647 85,357,345,350 85,708,487,159Value Added Tax (VAT) 107,479,336,359 129,342,904,204 128,087,238,261 135,905,130,645TOTAL 277,625,228,857 318,686,852,827 357,001,864,879 394,151,024,855

ICT sector tax contributions to revenue

A total of UGX 394 billion was realized as tax revenue in Q4 compared to 277 billion realized in Q1, signifying a 42% growth in ICT tax contributions to Revenue in the period Q1 to Q4.

Taxe

s180,000,000,000

160,000,000,000

140,000,000,000

120,000,000,000

100,000,000,000

80,000,000,000

60,000,000,000

40,000,000,000

20,000,000,000


OTT subscriptions and OTT tax revenuessource: URA

Q3 to Q4 variations show that both the OTT subscriptions and the OTT tax revenues grew by 17% and 2% respectively. This figures are reflective of those who have used OTT services at least once in the quarter. Q3 2018 Q4 2018

12,696,558,400

19,591,499 22,918,911

12,952,833,800

OTT subscriptions

OTT Tax


ONA unique roaming subscribers

Q4 reported increase innumber of inbound andoutbound ONA roamers ascompared to Q3.

The number of inboundroamers grew by 12.6% andthe number of outboundroamers grew by 35.3%.

Q3 2018 Q4 2018

358,623

633,205

713,297

485,258

Number of inbound roamers-ONA

Number of outbound roamers-ONA


ONA roaming traffic (voice)

The Mobile terminated(received calls) trafficcontinues to dominatethe ONA roaming voicetraffic.

This was also the case in the previous quarter.

80,000,000

70,000,000

60,000,000

50,000,000

40,000,000

30,000,000

20,000,000

10,000,000

ONA voiceInboundroamers-MT

ONA voiceoutboundroamers-MT

ONA voiceInboundroamers-MOC

ONA voiceoutboundroamers-MOC

Q3 2018* 72,981,193 43,740,018 8,580,908 2,458,643Q4 2018 69,279,799 51,951,856 9,064,697 2,448,712

TRA

FFIC

IN M

INU

TES

MOC-Mobile Originated Call; MT-Mobile Terminated call


International roaming traffic (Excluding ONA)

Other than the international voiceinbound roaming traffic MOC, positive quarterly growth was registered for every other categoryof the international roaming traffic as shown on the graph.

The International voice inboundroaming traffic (MT) grew by 1.6%, the International voice outbound roaming traffic grew by 5.1% and the International voice outboundroaming traffic grew by 2.1%.

800,000

700,000

600,000

500,000

400,000

300,000

200,000

100,000

International voiceInboundroamers-MT

International voiceoutboundroamers-MT

International voiceInboundroamers-MOC

International voiceoutboundroamers-MOC

Q3 2018* 411,637 606,811 730,352 200,265Q4 2018 418,165 637,998 729,793 204,539

TRA

FFIC

IN M

INU

TES


Trend in domestic SMS traffic

The A2P SMS on net traffic dominates the sms market (89.6%)resulting from market demands forelectronic confirmations forvarious online services.

This is followed by the P2P on net SMS (10.0%).

However, in Q4, the A2P SMS on net dropped by 30.3%. P2P on net SMS as well declined by 0.06% while the P2P off net grew by 0.4%.

4,322,785,110

467,083,313

16,378,395

466,787,991

4,181,073,741

Q3 2018* Q4 2018P2P SMS On net 467,083,313 466,787,991P2P SMS Off net 16,378,395 18,257,269A2P SMS on-net 4,322,785,110 4,181,073,741

18,257,269

SMS

TRA

FFIC


International P2P SMS traffic

In Q4, the internationalterminating P2P SMS traffic grew by 3.8% and theinternational originatingP2P SMS traffic grew by 13.7%.

1,303,280

1,125,319

1,353,4401,279,976

Q3 2018* Q4 2018P2P SMS On net 467,083,313 466,787,991P2P SMS Off net 16,378,395 18,257,269A2P SMS on-net 4,322,785,110 4,181,073,741

International terminating p2p sms traffic (outgoing)

International originating p2p sms traffic (incoming)

Q3 2018* Q4 2018

INTE

RN

ATIO

NA

L P2

P SM

S TR

AFF

IC


Internet


Internet subscriptions

The Uganda internet market isdominated by mobile internet. The mobile internet subscription now stands at 14,360,847 up from13,569,354 reflecting a growth of 5.8%.The total market (this includes bothOTT and web access) internet penetration now stand at 37%.

Q1 2018 Q2 2018 Q3 2018 Q4 2018

Internet subscription (Fixed)

Internet subscription (Mobile)

16,000,000

14,000,000

12,000,000

10,000,000

8,000,000

6,000,000

4,000,000

2,000,000

-

10,400

10,200

10,000

9,800

9,600

9,400

9,200

9,000

8,400

9,974

10,273

8,868

9,485

10,420,1269,855,034

13,569,35414,360,847


Number of Smart Phones registered on the network

The total number of smart phones in the market grew by 14% in the period Q1to Q4. The number of smart phones in the market was 5,219,729 by end Q4.

4,572,648

4,917,9164,977,488

5,219,729

Q1 2018* Q2 2018* Q3 2018 Q4 2018


Communications infrastructure.NUMBER OF BASE TRANSMITTER STATIONS

The number of Base Transceiver Stations ( grew by 0.9% in Q4

Q1 2018 Q2 2018 Q3 2018 Q4 2018

4,425

4,243

4,857

4,903


Towers

The total number oftowers owned grew from 0.9% leading to increased network quality of service.

Total Number of Towers Number of Towers shared Number of singletenant Towers

2,957 2,986

1,767 1,783

1,190 1,203

Q3 2018

Q4 2018


Mobile Money


Mobile money subscription vs mobile subscription

The number of mobile money subscription grew by 2.2% and the number of mobile subscription (GSM) grew by 5.3%. The number of active mobile money subscription (SIMs which registeredbusiness in the last 90 days) dropped by 3.6%.Source: BOU

13,652,58324,465,982

24,472,033

14,169,24023,948,565

23,249,967

12,842,833

22,733,823

21,648,672

13,373,933

22,662,024

24,024,925

Number of Mobile money subscription (Active 90 days)

Number of Mobile subscription

Number of Mobile money subscription (Registered)

Q4 2018

Q3 2018

Q2 2018

Q1 2018

- 5,000,000 10,000,000 15,000,000 20,000,000 25,000,000 30,000,000


Mobile money transactions

The value of transactions, balance on customer accounts and the number of transactions all grew by 21.1%, 17.4% and 12.8% respectively in the period Q3 to Q4.Source: BOU

25,000,000,000,000

20,000,000,000,000

15,000,000,000,000

10,000,000,000,000

5,000,000,000,000

700,000,000

600,000,000

500,000,000

400,000,000

300,000,000

200,000,000

100,000,000

-Q1 2018 Q2 2018 Q3 2018 Q4 2018

Value of Transactions (Shs) 18,848,720,076,113 19,347,889,204,239 14,880,145,560,785 18,023,301,103,972Balance on Customers Accounts (Shs)

500,272,934,189 495,977,449,459 288,114,749,253 338,207,228,569

No. of Transactions 340,736,059 358,272,314 554,412,571 625,314,713


Mobile money agents

The number of mobile money agents had been on a growing trend. In Q4, the number of mobile money agents grew by 3.5%.

Q1 2018 Q2 2018 Q3 2018 Q4 2018

163,082166,194

178,248

184,529

No of mobile money agents


Broadcasting


Pay tvs, mode of broadcasting & geographical coverage

No. Station Name Mode ofBroadcasting(Platform)

Television Coverage

1 DSTV Satellite Country Wide

2 ZUKU TV Satellite Country Wide3 AZAM TV Satellite Country Wide4 STARTIMES SAT Satellite Country Wide5 Kwese Support

Services Uganda Ltd(KSSU)

Satellite Country Wide

6 STARTIMES Terrestrial Kampala, Wakiso, Mpigi, Masaka,Mbarara, Fortportal, Jinja, Mukono,Kalangala, Luweero,Gulu and Mbale

7 GO TV Terrestrial Kampala, Jinja, Iganga, Mbale, Lira, Gulu,Arua, Kasese, Mbarara,Masaka, Wakiso

8 Kampala SITI Cable Cable Kampala & Jinja


Broadcasting

Out of Eight Pay Televisions Stations, five (5) broadcast using Satellite, two (2) Digital Terrestrial and one (1) uses cable as the mode of broadcasting.


Trend in active pay TV subscriptions

The number of Pay TV subscribers grew by 82.6 % in the period Q1 to Q4.

Q1 2018 Q2 2018 Q3 2018 Q4 2018

1,198,3891,469,129

2,165,293

2,188,233


Post & Courier Services


Postal Access

Indicator Q1-2018 Q2-2018 Q3-2018 Q4-2018Number of Permanent Post Offices

154 154 154 154

Number of Permanent Post Offices connected to the internet

33 33 33 33

Post Offices offering public internet services

25 25 25 25

Private letter boxes 82,900 82,900 82,900 82,900


Postal distribution in Uganda

32

Postal distribution in uganda


Quarterly postal mail volume

A growing trend had been registered for all the categories of the Domestic letter post through out the four quarters. For the period Q3 to Q4, the Domestic ordinary letter post, the DEMs and the Domestic registered letter posts grewrespectively by 23%, 79% and 118%.

80,000

70,000

60,000

50,000

40,000

30,000

20,000

10,000

-

31,509

21,987

1,924

43,571

30,435

2,574

54,399

37,723

2,960

67,162 67,393

6,458

Q1 2018 Q2 2018 Q3 2018 Q4 2018

Domestic Express Mail Services (DEMS)

Domestic Ordinary Letter Posted

Domestic Registered Letter


Domestic Express Mail Services (DEMS)

Letter traffic

Letter category Q1-2018 Q2-2018 Q3-2018 Q4-2018East African Letter post

IncomingOutgoing

29,7293,307

4,3432,014

6,527797

7,8301155

European Letter post

IncomingOutgoing

48,47851,112

41,45538,448

45,19632,180

63,97436,652

Rest of Africa Letter Post Traffic

IncomingOutgoing

7,0882,704

3,0451,711

1,033778

1,9761182

America Letter Post Traffic

IncomingOutgoing

36,16434,080

17,74317,154

27,02212,255

26,96016,411

Rest of World Letter Post Traffic

IncomingOutgoing

52,61522,377

37,54822,974

49,6794,748

56,5868,681


Tariffs

The tariff plans in the communication sector varies according to the marketsegments. For the different market tariff plans, please visit the two UCCaccredited price comparison websites;1. www.price-check.co.ug2. www.kompare.ug

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communication sector performance report quarter ending

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