MTN signs 400,000th subscriber: throws down gauntlet to Globacom

18 Sep 2003

MTN Uganda has announced the signing of its 400,000th mobile subscriber, confirming its place as the leading wireless services provider in Uganda, ahead of UTL Telecel with around 130,000 customers and Celtel (100,000). MTN Uganda launched commercial operations in April 1998 after its largest shareholder, South Africa’s Mobile Telephone Networks (MTN), was awarded the second national mobile operator’s licence. From the start MTN introduced significantly lower tariffs in a bid to make mobile services accessible to all. Its lower-pricing policy was bolstered by its strategy of rolling out services nationwide and the company’s chief marketing officer Eric Van Veen said the plan had resulted in more than half its entire subscriber base being from the more rural areas of Uganda. MTN’s predominantly GSM platform was built using equipment supplied by Ericsson and now covers over 90% of the urban population as well as more than 120 towns and villages. The achievement far exceeds the company’s licence commitment to roll out 89,000 lines within five years of operation, and is a far cry from 1998 when there were fewer than 50,000 fixed and mobile lines in the country as a whole.

Although MTN has managed to maintain a dominant position in the fast-growing mobile sector – the number of people owning a phone stood at just 6,500 in 1996, but leapt to over 188,000 by end-2000 – it now faces a fresh challenge from newcomer Globacom Limited. Earlier this month Globacom launched its rival Glo-Mobile service to much fanfare in Abuja, trumpeting the country’s first ever per second billing system which it hopes will quickly help it gain market share. The established competition still uses per minute charging, a fact which has caused much public outrage at the relatively high cost of services and has given rise to plans for a nationwide boycott of GSM services on 19 September. Although MTN had previously scheduled to adopt per second billing by 2007 at the earliest, it now says it will invest UGS5 billion on implementing the system sooner in an effort to assuage customer concerns.

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