What you need to know:
- Evolution. Uganda should be standing shoulder to shoulder with its neighbours in 10 years’ time. According to Dennis Kahindi, the cost of internet services in Uganda is still high.
The pandemic has brought great changes to the way organisations and enterprises run. Following the effects of the pandemic, digital transformation has become one of the necessities for enterprises.
Mobile money is, without doubt, the most remarkable example and preferred way to make payments both for the banked and unbanked due to its safety and unmatched convenience.
Why digital transformation now?
The disruption by the pandemic calls for digital transformation that requires us to work, watch, study, pray, shop and do everything at home.
Despite the digital transformation that was accelerated by the pandemic, Uganda still has a low rate of internet adoption standing at 23.7 per cent out of the total population according to a recent report from the World Bank.
The need for reliable and fast internet in homes across Uganda has grown more than ever but data costs and reliable internet remain a huge challenge across the country.
According to Dennis Kahindi, the CEO of Liquid Intelligent Technologies Uganda, the cost of internet services in Uganda is higher compared to other regional members of the East African bloc and one of the major reasons why these costs are high is because of the taxation.
“Uganda has excise duty, VAT and VAT on imported services that sit on top of internet services, which make it more expensive than the regional. These taxes alone are about 45 percent of the cost of the internet goes straight out of pocket to the taxman.”
He adds that the investment required to deliver the internet in terms of infrastructure is quite prohibitive. Internet penetration in this country still lies under 40 percent. We have enough internet for 100 percent penetration, but if only 40 percent are consuming it, then naturally the prices will also be a little higher.
The only way to get it affordable is both the private and the public sector coming together. The internet business, unlike any other, is the only business whose prices erode every single year. If the government comes in as a force to drive transformation in this country, invest in infrastructure, which they have done with the national backbone infrastructure being driven by Nita. Once that investment is done, those prices will come.
Where is Uganda?
Comparing Uganda to peers such as Rwanda and Kenya, in terms of digital transformation, the country is trailing on the right path, getting there and making the right kind of investment.
“We are making large strides forward and
technology business such as ours is how we begin to deliver the services to our customers. So the customer gets to the center of every digital transformation that every investment that we are making is to make our customer get easier access to our services, easier support about services and the best experience. And those investments are quite a number not only by us of liquid, but we have seen government also make huge investments and huge investments in different elements, including cyber security, cloud storage, and that is the transformative journey that we’re seeking.”
Cost of internet
The cost of the internet services in the country, low penetration of the internet, and infrastructure services are a challenge, but that is changing every single day. We are seeing huge investments in infrastructure, huge collaboration and we are on the right path.
There is a rising demand for remote internet services including online entertainment and thus the need to exert pressure on the regulator to make services much more available, for our customers so that we get there and get there really fast.
He adds that, “4G might not be as widespread as they make us believe, but there is good connectivity across the country. So for us to be able to deliver some of our services especially to the areas where we do not have a license, such as the eastern and northern parts of Uganda, we will have to sign and write on third party roaming agreements to deliver our services through that existing infrastructure.
“As Liquid Intelligent Technologies, we were formerly just a connectivity partner for most of our clients, delivering internet services. But we have since moved into co-location services, data centers, cloud technology services, and cybersecurity services. The reason why we’re getting onto this journey is that technology is and will be at the center of everything that we do.
The future of technology
Asked to speculate what Uganda’s digital transformation will be like in 10 years’ time, Mr Kahindi says. “Uganda should be standing shoulder to shoulder with its neighbours. I expect technologies such as 5G to be fully rolled out in Uganda, the Fourth Industrial Revolution to have taken a foothold in Uganda and that the Internet of Things will be second to nature. That digital transformation will not just be another tagline, but it will be something real and the centre of everything we do as a country.”
Not so many areas in Uganda are really covered up operating networks and Liquid Intelligent Technologies in a bid to accelerate access to the internet and connectivity in those areas may be a bit challenging.
However, Mr Kahindi says that for his company to be able to deliver services, the need to ride on third party infrastructure since major players in this country like Airtel and MTN have covered this country pretty well.
“Our license requirements from the telecommunications commission allow us to deliver services across the entire landscape of Uganda. But for us to deliver those services, we need to ride on infrastructures which already exist.”
Liquid Intelligent Technology is a national public service provider of internet but using third party infrastructure with a license from the Uganda Communications Commission.
Mr Kahindi is a business strategist and financial acumen from the NSEAD Business School, holds a bachelor’s degree in mass communication from Makerere University, and an MBA from the United States International University in Nairobi.