By Tom Sheridan
In February, I had the opportunity to travel to Uganda, Africa, to work on the expansion of an elementary school in Lukaya and to provide support in repairing a solar-powered water system in a neighboring village called Kalungi. It was a wonderful, life-changing experience and a remarkable privilege to be able to go there. While on the trip, I saw the business of cellular telephones and wireless Internet in a completely new light.
In Uganda, cellular rules are all different. In fact, they’re deceptively simple. It’s fascinating how the business of cellular communications evolved so well there in less than ten years. With the exception of Kampala (Uganda’s capital), there are few wired telephone lines. Cellular phones, however, have really caught on – the networks there are “3G” and reliable.
Uganda is a third-world country; its economic output per capita ranks in the bottom fifth worldwide. The average income per person is around $100 a month, so there is little disposable income. Historically, I imagine telephones weren’t needed outside of the major populated areas; for most Ugandans, their world was quite local.
In Uganda, cell phones are not registered to people – only to the networks. Phones are plentiful, and you can easily buy them “reconditioned.” For service, a SIM card (a small computer chip), which costs 3,000 shillings (about $1.50 USD), is required. That activates the phone, provides a phone number, and supplies the first five minutes of airtime. Additional airtime can be purchased in increments for as little as 200 shillings ($0.10 USD). Except for the phone itself, all costs are included in the airtime charges as there is never a bill or a contract required. SIM cards can be interchanged between phones, so an individual’s number and contact list can be “ported” to another phone in seconds.
Airtime cards are sold everywhere, and the commission to the seller is just a small percentage of the purchase price. The cards are about the size of a credit card and come sealed in a plastic wrapper. Open it, and then scratch away a strip on the back of the card to reveal an activation code. Airtime is added to your phone by texting the code to the carrier. A confirmation, with the new balance, comes back instantly.
Receiving calls and text messages on cell phones is always free; all that is needed is a working phone with a SIM card. This has allowed for strong market penetration. However, all calls originated are timed, and the calling phone is charged for the airtime used. Calls are about ten cents a minute, but when the average worker earns just a few dollars a day, making calls is a luxury. Most are quick exchanges of information. After each call is made, a text is received providing the cost of the call and the remaining balance.
Since there are no plans or contracts of any kind required, there is no central phone directory or public registration of numbers. You cannot call “directory assistance” because there is none. There are about five competing cellular companies in Uganda with overlapping territories. Each company has a color, much like a team color. Calls to another provider’s network are typically charged at a premium, similar to a roaming charge. There are “two SIM-card” phones available so that networks can be switched on the fly to help keep call charges more affordable.
Electrical power is irregular and frequently unavailable, and many Ugandans live without electricity altogether, so recharging of phones is often an issue. There are generator powered “recharging stations” available in the towns. Samsung recently came out with a “solar-powered” phone, which is the model I purchased for about $50. Every hour of solar charging provides about ten minutes of talk time. That’s not much, but it’s enough to power the phone in an emergency. It was more of a novelty than a necessity for me. I ended up giving mine to a teacher at the school; it was a most welcomed gift.
In the towns and villages, most storefronts need painting, but paint is expensive. Capitalizing on this, the cellular companies will offer to paint a business in their company color for free and emblazon it with their logo. Where else can you buy nearly free billboard-size advertizing for the cost of paint and a few dollars in labor? No permits are required either.
The cellular industry is a corporate anomaly in the third world, but it has become a part of the daily lives of many Ugandans. SMS text-messaging is commonplace, with each text costing the equivalent of about seven cents. Most phones I saw were basic by Western standards. Voice and text messaging worked well consistently; Ugandans like their phones and use them.
Wireless Internet is a different story. “High-speed” bandwidth is expensive or just unavailable. Getting online was easy, but once “authenticated,” the initial connection speed lasted just a few seconds. Often, sending just a small file attachment would time out and fail. My experience with wireless Internet in Uganda made my dialup experience from ten years ago look appealing.
Before wireless Internet became available, “Internet Cafes” provided computers and Internet service where one could literally spend an entire day to do some basic e-mailing. Not surprisingly, these cafes charged by the minute, too. Cafes are still around, but the bandwidth has improved enough that now a connection there can actually be productive.
The latest news is that fiber is coming to much of Africa. I understand that the continent had a bandwidth bottleneck that hindered getting traffic to and from the rest of the world. New fiber has been installed on the ocean floor and is now being extended across the continent. In fact, fiber was being buried in conduits along the main road in Lukaya while I was there. Because labor is plentiful, Ugandans are hand-digging the trenches. These laborers are paid the equivalent of about eight dollars to dig a section of ditch one foot wide by four feet deep by ten feet long. The work takes about a day, and the pay is considered good for “temporary work.” It is hard, hot work, yet the laborers’ dedication to the task is remarkable.
My guess is that this fiber will be connected to the cellular infrastructure shortly, and since the 3G network is already in place, a quantum leap in Internet speeds and reliability will occur soon. Most of the 33 million Ugandans don’t have computers (or the electricity to power them), so it won’t affect the average person in the short term, but reliable Internet access will benefit businesses and spur foreign investment.
Undoubtedly, reliable communications and improving Internet service have added economic value to the local economies throughout Uganda, even though the steady stream of shillings spent on airtime is disappearing, perhaps for good. Despite their remarkable market penetration and apparent success, cellular companies in Uganda remain an automated industrial complex, a world away from the labor of the masses still digging in the trenches.
[From Connection Magazine – May 2010]