Ms Sylvia Mulinge, the chief executive officer of MTN Uganda. PHOTO/ISMAIL MUSA LADU
2024 was a good year for you. What drove it?
I believe the key factor is the belief we hold. We believe that everybody deserves the benefits of a modern connected life. This was evident across our different markets. It is that belief that provides fuel to everything that we do.
We believe that regardless of which remote area you are in the country or who you are – maybe a small business entity, a student, a big corporate organisation, an entrepreneur, or a public servant you deserve the benefits of a modern connected life and our task is to enable that. We know that by driving connectivity, we are also driving the digital progress of Uganda. Then we ensured that we all read from the same script no matter your department in the organisation.
Because of that, we attained our priorities which include ensuring proper network availability. This means that people must have devices that they can use to consume the network that we have deployed. The GSMA reports show that while the African continent has made significant strides in bridging the coverage gap, we still see a massive usage gap because people don't have the right devices to consume this coverage.
So we asked how we could provide the network. Then how do we bridge the usage gap by having the right devices for the customers? And how do you provide the right propositions because we must drive affordability which is a whole different ball game.
However, we are working with the sector regulator intending to solve the affordability issue so that everybody can enjoy the modern connected life.
Then there is driving literacy. This is important because you might have an affordable or right device but you don't know what your gadget can do with the network. All these helped us deliver to our shareholders. We are quite happy with the results - profit after tax of Shs641.548 billion in the financial year 2024, reflecting a profit margin of 20 percent.
We have also seen effective cost management alongside a strong cash flow. We have witnessed growth in voice, fintech, and data, while also ensuring strong returns.
So shareholders should be walking to the bank smiling …
We are proud of returning a good dividend to everyone who has invested in MTN Uganda. We saw a 32.8 percent increase in our dividend payout. I think this news has been received very well by the investors – both retail and institutional investors.
Many people find the cost of digital penetration and related services is too high. How can a balance be struck here?
The cost of transacting is the price we pay for the service offered. As a customer, it is almost embedded in many of us to want everything for as little as possible or free of charge. We also know that customers want faster connectivity and excellent services, and they want all that at nearly zero or zero cost. But the reality is that this is not possible. As a result, we need to strike a balance or some kind of “give and take”.
We are engaging with the Uganda Communications Commission (UCC), consumers’ advocacy groups, and several experts on the issues around affordability because it will increase access, which is largely driven by the cost, which is the price that customers have to pay to access the service.
However, we are already doing so much around pricing innovations to ensure low, for example, you have access to low-rate bundles. We are also looking at how to provide big bundles with shorter validities to make it balanced out for customers.
If you succeed with the price model do you think the whole industry will also benefit from it?
We would want to think so because we are trend setters. For example, in Kenya, one of the industry players made transactions of a certain value and below to go for free. We are already doing the same for certain transactions of funds here in Uganda. We need to continue driving awareness around it. It should be normal for one to purchase some milk or a piece of bread at a local kiosk and pay for that using mobile money.
Again, the challenge is that pricing has been seen as a barrier because many times, people want services at zero cost yet there is a cost of delivering that service.
For example, in mobile money, there is the SMS cost, the cost of the network, the cost of the platform that is doing the transaction. We also have to pay revenues to the government. So balancing all that will require that we charge some cost for transactions while ensuring affordability which, in itself, is a dilemma that we have to work with.
A mobile money kiosk in Kampala. Mobile money transactions in Uganda have reached Shs191 trillion in the 12 months to June 2023 according to the Bank of Uganda. PHOTO/FILE
And on the e-commerce front, how is the industry helping?
I think this is very much dependent on behaviour. The critical role that we have to play is to provide the platforms that allow customers to interact and kind of aggregate all the buyers into one space and do the same for the sellers as well as to provide customers with an easy way to purchase. For us, this is one way to unlock the power of e-commerce.
Looks like you are evolving from a Telecom to Tech company. Is that fair observation?
It is about the mode of delivering services. Question is: Are we still delivering services in the traditional way or we are leveraging the digital infrastructure to provide solutions and services? For example, look at how we disbursed PDM [Parish Development Model] funds. We ensure traceability for the purpose of accountability. Again, I think the key question to ask is how we are leveraging technology that we have to drive the digital progress of Uganda.
As an organisation, this demands that we move from just providing basic voice, SMS and data services. Businesses that we deal with ask us to manage their storage, connect their networks, provide them with the securities and surveillance solutions and provide them data storage services.
Now, it is no longer just about voice, SMS and data services. So we must become an enabler. You have to provide the ICT services required by the consumers no matter where they are located. So we have to balance all that and make sure we are not left behind. This compels us as to begin possessing more of a tech mentality and mindset.
