France Telecom Hits It Off with Ugandan Discussions

France Telecom has taken over the national GSM license held by Hits Telecom Uganda and said that it plans to launch a new joint venture company operating under the Orange brand in the coming months.

The company did not specify the financial terms of the agreement, but did say that it will take 53% of the joint venture and would continue to use Hits Telecom's existing Alcatel-Lucent supplied GSM network infrastructure. France Telecom will provide the financing required for the launch, and all of Hits Telecom UgandaĆ's staff are invited to join Orange Uganda.

Hits Telecom Uganda major shareholders are based in Abu Dhabi, and the company has been awarded a full telecommunications license, which includes the GSM 900/1800 spectrum, WIMAX broadband, international gateway, mobile virtual network operation and data transmission services.

The company said that the investment is fully in line with its development strategy targeting strong growth markets and will further strengthen its presence in East Africa. It follows the acquisition of a 51% stake in the incumbent operator Telkom Kenya in December 2007 and the launch of the Orange brand in Kenya on September 17.

Uganda's telecoms regulator, the Uganda Communications Commission (UCC) earlier warned Hits Telecom risked losing its operating license if it did not commercially launch its network by September. The company was granted a mobile license last March and has eighteen months from that date to start offering services.

The country has five mobile operators, the two incumbents UTL and MTN while Zain (formerly Celtel) was licensed in 2005. Warid launched its network in February this year. According to figures from the Mobile World database, the country ended the first half of this year with just under 6.5 million mobile subscribers - representing a population penetration level of 21.5%

Earlier this year, India's Reliance Communications brought Uganda based Anupam Global Soft, a company holding mobile and landline licenses in addition to WiMAX and Wi-Fi services in Uganda.
This company has received Spectrum allocation and plans to launch its Mobile services by end of 2008. The company says that following the acquisition - for an unspecified amount - it plans to spend up to US$500 million on building out the telecoms network.

A CDMA operator, I-Tel also expects to launch its network in December and aims to offer tariffs comparable to landline prices.

Posted to the site on 20th October 2008