9 June 2017

Uganda: Vodafone Uganda CEO John Ndego - ' More and More of Traditional 2G Services Are Becoming Something of the Past. High Speed Data Is Gradually Taking Over'

London — Challenger LTE operator Afrimax is now active in four African countries and has ambitious plans to roll-out across the continent. It is using a Vodadfone partner agreement to provide branding in most territories and products and services. Russell Southwood spoke to Vodafone Uganda CEO John Ndego about

Afrimax was founded by mobile telephony entrepreneurs Jay Metcalfe (Chairman), Peter Langkilde (Chief Executive Officer) and Rob Philpott (Chief Financial Officer) who, for over twenty years, have been involved in telecoms start-ups, operations and financing in Africa and around the world including Millicom, Celtel and BellSouth.

In September 2015 it attracted US$150 million in investment from Japanese company Mitsui. Other shareholders include Torreal, one of the largest private investment firms in Spain, Four G Capital, and the IFC.

In 2014 it signed a partner market agreement with Vodafone (more of which later) to use its branding and products and services. It has rolled out in four countries so far - Uganda (its first roll-out), Zambia, Cameroon and Ghana - and has others in its sights. Because Vodafone Ghana is already a brand in that country, it trades under the name of the company it bought there, Busy Internet.

Vodafone Uganda launched in 2015 and built an LTE network squarely aimed at the mass market. Whereas most independent ISPs have lived off corporate customers, it has become, along with Smile, one of a new generation of ISPs (or probably more accurately data providers) firmly targeted at something much more like the mass market.

Its network covers the Greater Kampala area and it recently rolled out to Mukono to the east of the capital. By the end of 2017 Ndego says that its coverage will be right across Uganda. It currently has in excess of 100 base stations.

"From the strategic point of view, we want to focus on the 4G space and want to become number one in the 4G space, number one for data and number one for youth and SMEs... We offer voice and data services but we're different from other operators."

It currently has in excess of 100,000 subscribers, which is a large number for an independent operator in a country of this size. The current estimate for overall 4G users is 1.4 million.

So how big will Vodafone Uganda's subscriber base be once it has national coverage:"We will more than quadruple in size. More and more of the traditional 2G services are becoming something of the past. High speed data is gradually taking over. Things like Whats App are growing rapidly and we have a youth product called Swift which has all the social media apps like Whats App, Snapchat and Instagram. Twitter and Instagram are very popular."

Monthly bundles vary from 10GB for UGX125,000 (US$34.79) to 40GB for UGX330,000 (US$912.85). Vodafone Uganda's level of data use has gone up by 20% over the last 12 months although prices have remained relatively flat throughout the sector, although there have been some fairly aggressive promotion prices.

The most common uses for its 4G bandwidth are mainly video, email and social media. Faster speeds have allowed users to watch live TV and You Tube videos and to download videos. Although it doesn't push it, its customers have access to voice and it sells dual SIM smartphones that allow customers access to a mobile operator for voice or a voice app like Whats App:"From a strategy point of view we decided to push data and give voice as an add-on."

It has an education and entertainment platform called Jump which is aimed squarely at youth users:"It offers content in education, lifestyle, entrepreneurship and music." In April 2017 it launched Jump Academy an e-learning space for university students. The platform is open to all Internet users but for Vodafone Uganda users it is zero-rated.

So how does the partner market agreement with Vodafone work?:"Afrimax does all the investment and uses the brand under a framework agreement. Afrimax is registered to trade as Vodafone Ghana and uses all of (Vodafone's) guidelines and branding. Vodafone has made no direct investment."

Vodafone and Afrimax have a trust relationship governed by the agreement and Vodadone reserves the right through that agreement to ensure that its standards are met.

"We are in the vanguard of bridging the digital divide, moving from 2G to 4G. We have a programme to empower university students. We want our customers to have the same access to technology as in other parts of the world."

Uganda

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