Companies hope their wide networks and tech-savvy will prevent subscriber haemorrhage
SIM card registration could help cement the status quo in the telecom industry as existing distribution networks play a critical role in public mobilisation. With the Uganda Communication Commission having no public-outreach network of its own, the success of the registration process will rely entirely on the companies.
Operators say they are prepared for the challenge, not least because their readiness will determine what customers they keep, and which ones they lose to better prepared rivals. As always, innovation will pay off.
UCC announced recently that SIM card registration would last 12 months, starting on March 1, 2012 and ending on March 1, 2013, at which point networks will be obligated to cut off any unregistered SIM cards. That is a step networks will want to avoid as it will diminish their subscriber numbers.
Edouard Blondeau, the Chief Strategy Officer of Orange Uganda Limited, says the company plans to use the exercise to roll out a simple but efficient phone-based registration technology that works across the country, including in remote rural areas.
“This technology has been thoroughly tested in other African countries where Orange had to address the registration of customer SIMs as a result of regulatory obligations,” Blondeau told The Independent, without revealing details of how the technology will work.
He said the company will be ready to start the registration exercise and finish within the stipulated period. If successful, the simple, efficient and low-cost technology could be deployed in other registration exercises, including census and voter registration.
Joseph Kanyamunyu, the head of communications at Airtel Uganda, said his company had embarked on low-scale registration as early as August 2010.
“All our customer interfacing staff have been trained and made readily available within the regions they operate to start the process,” Kanyamunyu said.
He believes the 12 months to be adequate, especially if UCC undertakes a robust sensitisation campaign to ensure public awareness and acceptance. The Independent has learnt that UCC had already hired a communication agency for such a campaign.
Shaibu Haruna, the general manager (Sales) at MTN Uganda, said operators had agreed procedures that would apply to every subscriber and were well prepared.
“What is crucial is the availability of registration facilities,” Haruna said. “We have resourced adequately to meet the 12-months deadline.”
He said the dominance of MTN’s product distribution network would ease registration of all its subscribers.
“We will make use of our MTN service centres, dealer shops, Mobile Money agents and other retail channels,” Haruna said.
Warid will also deploy its distribution network, including Warid Pesa agents.
“Already some of our agents have been briefed about the exercise and are ready. We shall be done by deadline,” Naidu said, adding “We don’t want to lose any customer because they add value to our business and we add value to their life,” said Shailendra Naidu, Warid chief commercial officer.
“We have to work hard to ensure that all our subscribers and those that intend to become our customers, register. If they don’t, the loss will be ours,” Naidu said.
According to the ICT Ministry, there are over 16million mobile phone subscribers in Uganda, with the number rising as more people realise the importance of a mobile phone. Of these, MTN accounts for the largest share of over 7million and Orange the least of only 1 million. The balance is shared between Warid, Airtel and UTL. Other players are Smile and I-Telecom.
Benefits vs costs
Some telecom players are worried that their subscriber numbers will reduce as customers who previously maintained multiple lines will drop some, affecting the revenue of telecom companies, wholesalers and vendors.
It is currently easy to buy a new SIM card at between Shs 1,500 and Shs 3,000 and use it for any purpose without detection. Registration will make it possible to track users even if SIM cards are thrown away.
Peter Okello, a sim card vendor in Kampala, worries that registration will push him out of business.
“I know people who possess two or more lines of different companies. Such customers are likely to disappear,” said a worried Okello, who said that on a good day, he sells 50 SIM cards of different companies, making about 60,000 a month.
Players predict that after registration, the cost of a SIM card may rise since the number in circulation are likely to be reduced and directly monitored by telecoms and other authorities.
Okello buys one MTN card at Shs 1,500 and sells it at Shs 2,000. But in most shops they go up to Shs 3,000. Okello sells Warid cards at Shs 1,000, after buying them at Shs 600 each. He buys Orange at Shs 400 and sells at Shs 1,000. He buys Uganda Telecom at Shs 600 and sells at 1, 000 per card. Airtel is the cheapest at Shs 500, buying it at Shs 200 from a wholesaler.
“I think the price of a card will increase after registration because we shall only have serious buyers and the little we have been earning will reduce,” Okello said.
But operators advise that the benefits of registration far outweigh any inconveniences. One key benefit will the capacity to identify specific users and enhance tracking of stolen phones as well as prevention of phone-related crime. It will also improve services by weeding out inactive subscriptions. Critics worry that it will facilitate the invasion of privacy, especially by state agents intent on clamping down on opponents.
The registration process is not that complicated. One needs valid identification such as passport, driver’s licence, staff identity card, voter’s card or Local Council (residential) card, with a current passport photo.
Registration of SIM Cards follows enactment of the Interception of Communication Act to combat telephone-facilitated crime and insecurity, and a mid-2012 deadline imposed by the East Africa Communications Organisation (EACO), for all SIM cards in the region to be registered. Kenya and Tanzania started registration last year and so far have covered 80% subscribers.
Like the operators, government officials also seem confident that Uganda will meet the deadline.
“It is our hope and we will be happy to finish the exercise within the stipulated time,” ICT Minister Ruhakana Rugunda told The Independent.
The minister said users will develop new confidence in using phones without worrying about involvement in crime. “It will help change the way people use mobile phones,” he said.
The key to success, however, will be massive public education, which UCC’s Head of Corporate Affairs, Fred Otunnu, says they have already embarked upon.
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written by Michael Kors, February 17, 2012
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