Mobile internet users grow amid low OTT collections

The number of mobile internet subscribers has increased to 14.3m from 13.5m representing a 37 per cent penetration.
According to the telecommunications sector report released by Uganda Communications Commission (UCC) for the period ending December, both fixed and mobile internet subscribers increased during the period.
“The internet market is dominated by mobile internet. The mobile internet subscription now stands at 14,360,847 up from 13,569,354 reflecting a growth of 5.8 per cent,” the report capturing data in other segments of the telecommunications sector such as mobile money and broadcasting, reads in part.
Uganda’s mobile internet subscribers have increased by four million since the beginning of 2018 when the number stood at 10 million.
Fixed internet subscription has also grown from 8,868 in September to 9,485 in December making the country’s overall internet penetration increase from 35 per cent to 37 per cent.

Internet penetration
However, Mr Micheal Niyitegeka, an IT expert and the International Computer Driving License country director, said the figures might not be reflective of a deepening internet access since they are not indicative of an increase in unique users.
“What this basically means is that any device that accesses the internet is regarded as a subscriber. It is therefore important to look at an array of interventions at the time,” he said explaining that: “For instance was there a promotion of devices, bundles among others?”

The smart phone factor
The increase could then be explained by the 14 per cent growth of smartphones on the network from 4.9 million in the third quarter of 2018 to 5.2 million in the three months leading to December.
Interventions by telecoms such as “everybody likes more of a good thing” by MTN, Airtel “Datablasta” and Africell’s “Don’t be cheated’” saw an increase in internet bundles offered at low costs.
The telecoms have also offered cheaper phones at their service centres in order to promote internet usage.
However, the figures do not conclusively indicate whether internet has penetrated throughout the country since some people own more than one smartphone.

Performance of OTT

To widen the tax base, government last year introduced over the top tax (OTT), a Shs200 levy daily on internet subscribers seeking to access some social media platforms.
However, UCC, in the report said that variations between the third and fourth quarter show that both over the top (OTT) subscriptions and OTT tax revenues grew by 17 per cent and 2 per cent, respectively.
It further reveals that subscribers that used OTT at least once in the quarter increased from 19.5m in the third quarter to 22.9m in the three months leading to December.
The tax revenues increased from Shs12.6b in quarter three to Shs12.9b in quarter four.
However, Uganda Revenue Authority, in its annual results in July revealed that it registered a Shs234.5b deficit in the OTT segment having collected only Shs49.5b against a target of Shs284b.
URA attributed the low remittance to the use of virtual private networks (VPN) and wireless Internet (WiFi).