Revamped UTEL gives gov't a fresh chance to grab marketshare

As Uganda re-enters the telecommunications sector with a strategic investment in UTEL, industry experts raise concerns about the company's approach to not only achieve profitability but also deliver high-quality services.

Analysts emphasised that UTEL must adopt a combination of effective management, aggressive marketing, and competitive pricing for its data services to make a meaningful impact in the fiercely competitive telecom industry.

UTEL marked its one-year anniversary and two-week milestone this week, signifying the Ugandan government's renewed commitment to reclaim a stake in the lucrative multibillion-dollar telecommunications sector.

A glance back at Uganda's telecommunications history reveals that Uganda Telecom once held a monopoly in the industry. The divestiture of the 1990s led to the establishment of Uganda Telecom Limited, alongside entities like Post Bank and Posta Uganda.

Under the new management of the Ugandan government, with the Ministry of Finance and Ministry of ICT as shareholders, UTEL has been operational for one year and sixteen days.

However, questions arise about how the company will carve out a competitive space in a market predominantly dominated by foreign capital.

Dr. Chris Baryomunsi, speaking at the launch event, identified upgrading the spectrum to 4G as a key strategy for UTEL's success.

"The magic bullet for the company lies in upgrading the spectrum to 4G," noted Dr. Chris Baryomunsi, Minister of ICT.

The Ministry of Finance, a key shareholder, is committed to providing the necessary funding to ensure that the challenges of the past do not hinder the new company's progress.

"We are dedicated to bringing forth the required funding to ensure that the past does not haunt the new company," stated Ramathan Ggoobi, Permanent Secretary at the Ministry of Finance.

Economic experts emphasized that for UTEL to thrive, it must operate with a profit-driven motive.

In addition, diversifying its products and services within the telecom portfolio is seen as essential.

"For the new company to succeed, it must adopt a profit-oriented approach and expand its offerings in the telecom portfolio," said Collin Mbulakyalo, a tech expert.

With a youthful population in Uganda displaying a keen interest in internet usage, experts suggest that UTEL could focus on catering to this demographic as a niche market.

"Given that the majority of Ugandans are young and enthusiastic about internet usage, UTEL could leverage this as a strategic advantage," Collin Mbulakyalo added.

Aggressive marketing and setting fees slightly lower than those of other private sector players have been identified as potential tactics that could breathe new life into the company, preventing a repeat of the challenges faced by Uganda Telecom.

As UTEL continues its journey to establish itself in the competitive telecommunications landscape, striking a balance between innovative strategies, competitive pricing, and delivering quality services will be crucial to its success.

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