Smile Communications gets Uganda licence but what will it do with it?


The Uganda Communications Commission (UCC) has confirmed that it has awarded a telecommunications license to Smile Communications (Pty) Ltd of South Africa.

Patrick Masambu, the executive director UCC said Smile Communications has been given a Public Infrastructure Provider (PIP) as well as a Public Service Provider (PSP) licences. "All I can tell you is that Smile intends to provide service at low cost with new technology," Masambu said.

This brings to 21 and 31 the number of PIPs and PSPs respectively in the Uganda sector but what is interesting to note that a lot of these companies hold licences but are not operational.

It is not clear whether Smile, which is led by former MTN Group director, Irene Charnely, intend to launch a mobile phone service as part of its entry into Uganda. Earlier media reports have said the company plans to provide affordable communications to the poor. Smile's acquisition of the two licences in Uganda launches the company onto the continent as it plans to spread its influence outside South Africa.

Smile has tested a tactic of giving customers their own telephone number and voice message boxes whether they own a handset or not. According to available information, Smile provides a customer with a secure PIN code to use on any Smile Communications phone.

In its home market of South Africa, the company operates through agents, who provide mobile handsets in street kiosks, stalls and payphones. Once customers log in, they can make low-cost calls and operate a voice mailbox with free message retrieval.

Having a personal number means the customer can be contacted directly, though the incoming caller will need to leave a voice message, unless the user logs on to a Smile phone at a pre-arranged time to answer the call.

Customers' airtime balance is always visible and calls are charged per second with the fee deducted from their prepaid airtime balance. The customer can also set up a contact list of numbers, with recent calls shown first for fast dialing.

The agents also sell handsets to customers who can afford them. Those phones can be shared by several people, with each user entering their PIN number to access their airtime. The system also benefits entrepreneurs in the communities by letting them start a new business using Smile's tools and training.

The company is owned by a consortium of Saudi Arabian investors, Charnely and South Africans Paul Savage and Sharron Vanessa Naidoo. The three own 21% of the company, with 79% held by Al-Nahla Technology, a Saudi Arabian consortium owned by Al-Nahla Group and the Atheeb Group.

East African Business Week