The duopoly telecoms providers in Uganda, South Africa’s MTN and Uganda Telecom, have opposed the Ugandan government’s plan to open up the telecoms market to competition.
The two providers told Parliament’s information communication and technology committee that opening up the telecoms market would not be in the interests of the country. They said that poor economic conditions are holding back the market, and not the lack of competition.
The two organisations said that opening up the market to competition would not address the primary obstacles to achieving high telecommunication penetration, reports the Ugandan Daily Monitor.
Uganda Telecom’s Donald Nyakairu said freeing up the sector “could attract new players who are only out to make profits, without much interest in contributing to the sector’s long-term growth”.
Nyakairu said the regulator should rather set standards that have to be met by the two providers with a provision to penalise failure to deliver on set targets.
In an editorial, the Monitor rejected this notion, saying: “What if the same standards are applied, but to more than just the two players? So we could have five service providers, but with each required to remit/invest a minimum amount of money in infrastructure development.
“That way, we will have ensured a sustainable telecommunications sector, while also achieving the primary objectives for which further liberalisation is being sought — cheaper and more accessible services. By opening the sector to more players, it is the majority who will ultimately gain.”
Members of the parliamentary committee also rejected the proposal, saying that the two companies have dominated the sector for a long period of time and expressing concern that leaving MTN and Uganda Telecom to dominate the market would hinder free competition for better and cheap services. — Tectonic