One Network Reduces MTN Uganda Cash Flow (allAfrica.com)

MTN Uganda reports that despite gaining a 7.2% increase in subscribers, it has been hit by a 12.8% decline in incoming voice revenue as a result of the One Network Area, officials have said.

“The While announcing MTN Uganda’s half year results, Brian Gouldie, MTN Uganda CEO said that the implementation of the One Area Network in the Eastern African region saw the telecom achieve an increase of only 2.6% in its total revenues.

“We have crossed the 11 million subscribers mark in Uganda and have seen strong growth in our voice and data bundle propositions. Fortunately this growth has compensated for the 12.8% reduction in international outgoing and international and national incoming revenues due to the implementation of the One Network Area,” he said.

East African Community (EAC) last year agreed that all calls between member countries should be billed as though they were local. The agreement led to a pact between Safaricom, MTN and Airtel Uganda that enables subscribers to receive calls for free while in Uganda and pay a flat rate of $0.11 for calls to other East African countries including Tanzania and Burundi. This led to a decline in mobile phone communication rates across borders in East Africa.

This is obviously good news to mobile subscribers but has resulted in reduced international and national roaming revenue for telecom firms.

According to a press release, the company’s data revenue grew only 8.5% mainly as a result of low 3G handset penetration and regulatory changes in third party content provision.

MTN’s total revenue increased by 2.6% supported by outgoing voice revenue which was underpinned by a 12.5% increase in billable minutes. MTN Mobile Money revenue also increased by 15.1% which was supported by an increase of 9.2% in 30 day active subscribers to 3.4 million. The results have also show that MTN Uganda, has now increased its market share to 57.6% despite operating in a highly competitive market.