The telecom sector needs more players

The announcement by the Rwanda Utilities Regulatory Agency (RURA) that the number of active cell phone subscribers has dropped, partly reflects, the impact of Rwandatel’s exit from the market. Since then, Rwanda remained with two mobile operators, MTN Rwanda and Tigo Rwanda.

The announcement by the Rwanda Utilities Regulatory Agency (RURA) that the number of active cell phone subscribers has dropped, partly reflects, the impact of Rwandatel’s exit from the market.

Since then, Rwanda remained with two mobile operators, MTN Rwanda and Tigo Rwanda.

RURA, in its most recent report on the sector, said that the numbers slid to 3,730,226 in May this year from 3,777,090 in March as the penetration rate dropped from 36.3 per cent to 36 per cent.

Yet RURA insists it will not relent on its ambitious forecasts to attain six million mobile phone users by 2012. 

In order to realize the objective, RURA will have to come up with strategies that encourage competition in the telecom market, by way of licensing more players.

Rwanda’s telecom industry has tremendously changed in the last few years, partly due to Tigo’s entry, which broke the duopoly then enjoyed by MTN and Rwandatel.

The government, through its fiscal policy, has increased subsidies to the sector by waiving Value Added Tax (VAT) on mobile handsets and import duty on SIM cards to increase penetration of telecommunication services to the lower segments of the population.

In order to boost the country's mobile penetration rate, these initiatives need to be supplemented by a liberal market with more players. 

This will increase access to telecom services, create more job opportunities and contribute to economic development.
 
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