Uganda: Broadband Company(ISP) Struggles as Competition stiffens
The board of directors of PME met on September 28, 2011 and promised to continue reviewing the progress of the company’s telecommunication investments including Broadband Company, following a strategic realignment of the business.
Making the decision
This comes on the back of a review that the PME board, according to a media release posted on Tuesday on the company’s official website (www.pmeinfrastructure.com), decided to recommend to shareholders a ‘winding up of the company without delay’.
Sources within the company and various media reports indicate that the internet service provider will wind up in January next year. Efforts to get a comment from company officials were futile as our repeated calls to known company executives (telephone numbers) could not go through or went unanswered
Commenting about the matter, Mr Godfrey Mutabazi, the executive director of Uganda Communications Commission, told The Daily Monitor newspaper that his office was yet to receive a formal communication regarding the firm’s liquidation. “We have never been informed and the decision they have taken is against the law. We have already written to them and we are yet to get a response,” he said.
UCC as the sector’s regulator oversees the operations of all internet service providers in Uganda.
High operational costs
The company is said to have been hit by high operational costs, resulting from high inflationary pressure, coupled with network interference and the increasingly competitive data market.
Broadband company has been struggling to grow its market share facing tough competition from telecom companies that are seeking for alternative sources of revenue and taking up data as a new area of growth.
Telecoms including: Orange, MTN, Warid, Airtel and Uganda Telecom provide internet services, which has hit up competition in the sector. Others players in the market include Foris, Afsat Communications, InfoCom and Datanet among others.