Orange sells mobile division in Uganda

2014-05-19 13:25
Mobile device data in SA is set to grow exponentially. (Duncan Alfreds, News24)

Mobile device data in SA is set to grow exponentially. (Duncan Alfreds, News24)

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Cape Town - Orange has moved to sell its operations in Uganda by signing an agreement with Africell Holding for the sale of its majority stake.

The deal, which is subject to regulatory approval, means that Orange is likely reviewing the viability of its operations in African markets.

Orange Uganda has 620 000 customers though market penetration in many African markets is low, and there is potentially a market for growth.

Vodacom in South Africa on Monday indicated that it is also looking at opportunities in Africa as the growth in its primary market flattens.

"The growth rate that we're experiencing in our international portfolio is superior to the growth rate we're experiencing in South Africa," Vodacom chief financial officer Ivan Dittrich told News24.

Challenges

He added that Vodacom's international business was growing faster than SA due, in part to lower penetration levels of mobile services.

However, while mobile coverage in Africa is on a growth path, many challenges remain.

"There's a misunderstanding or misperception of the part of many policymakers. When they discuss mobile penetration, there's this idea that mobile penetration has reached 60%, 70% 80% - 90% in some countries therefore the work needed to stimulate growth is finished at now the focus should be on milking the industry for tax revenues and what not," Peter Lyons, director of Public Policy Africa Middle East at the GSM Association told News24.

According to the organisation, South Africa's 100% SIM penetration equals around 31% on a unique subscriber basis.

Lyons warned that African policymakers were eyeing mobile services as a revenue stream.

"To address the political reality you have to offer some kind of viable alternative and for many policymakers, they see the mobile sector as a proxy to tax the informal economy."


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Read more on:    vodacom  |  orange  |  uganda  |  mobile
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