13 November 2012

Rwanda: Mobile Operators Set to Miss Penetration Target

With the slow pace of telecom operators to attract subscribers, Rwanda is likely to miss the mobile phone penetration target, according to Rwanda Utilities Regulatory Agency (RURA).

Rwanda targets a mobile phone penetration rate target of 60 per cent by the end of this year.

"When you consider the time remaining to reach end of year, it is obvious that we cannot meet our target," Jean Baptiste Mutabazi, Head of Communications and Media Regulation Department at Rwanda Utilities Regulatory Authority (RURA) told Business Times.

The regulator targets six million mobile phone subscribers by the end of this year. As of September this year, the three mobile operators had a combined subscription number of 5,155,697 million people, up from 5,090,028 subscribers in the month before.

In the period under review, MTN added 41,333 phone users to hit 3,229,672 million subscribers, while TIGO Rwanda added 8,746 subscribers to its network to clock 1,741,603 million.

New entrant Airtel Rwanda registered 15,590 new users reaching 184,422 mobile phone activations.

Mutabazi notes that the target may not be reached since telecom companies cannot close the gap remaining to close the year.

By end of last year telecom operators surpassed their target of 3,730,102 million by 19 per cent of which only two telecom operators Tigo Rwanda and MTN Rwanda were operating after the regulator revoked the third operator's (Rwandatel) license early 2011.

Experts say that the revoking of Rwandatel's license might have also led to a slow down in the number of subscribers thus affecting the sector's performance in terms of attracting more mobile phone users.

"When you consider the period between the revoke of Rwandatel's license and the begging of Airtel operations, it is a reasonable gap to cause impact on the number of subscribers," Job Opar, consumer protection consultant said.

Rwandatel's woes began when its GSM licence was revoked, early last year, by sector regulator RURA, following what the regulator insisted was the failure by the telecom to comply with its obligations.

Moreover, the recent network hitches that hit market leader, MTN Rwanda, since March this year and prompted RURA to slap a fine of Rwf3 million per day, may have pushed down the operators capacity to woe more customers.

"Network problems may stop people from using a network but I don't think it may affect the penetration since people have to communicate so they would opt for another network meaning they keep connected," Davis Mukiza, a Consultant said

Nevertheless, telecom companies are embarking on attracting new subscribers especially in rural areas, a thing that is likely to increase rural mobile penetration.

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