Mobile operators in Uganda are continuing to lower prices, leaving the country in the midst of another price war. In June 2011, the Ugandan Communication Commission (UCC) apparently reversed a decision to put a stop to incessant price cuts in the industry.
Warid Telecom and Uganda Telecom have already cut prices and launched a number of new promotions aimed at attracting customers.
According to TeleGeography statistics, Warid charges some UGX60 per minute for calls within its network and UGX180 per minute to other networks, having reduced the price from UGX480 to UGX300 and then to its current rate.
Telecom analysts are worried that should the price cuts continue, many of the country’s mobile operators would be in danger of losing their already slim profit margins in the coming months.
“It is definitely something to look at closely because by continuing to reduce prices this could really adversely affect the overall ability of operators to function and provide a long-term base for profits,” commented a telecom analyst source.
The UCC released plans for a directive that would put a price limit on interconnection rates and a 90-day limit on promotions between each individual promotion.
TeleGeography, telecom analysts in East Africa, said the proposal was “intended to stabilise the highly competitive sector and simplify rates for customers struggling to keep track of ever-changing prices and promotions.”