Ugandans will soon benefit from faster data speeds and easier access to electricity, following a deal between the country’s power transmission company and China’s ZTE, a telecommunications equipment and systems firm.
ZTE will construct a hi-tech fibre optic cable along the Uganda Electricity Transmission Company Ltd’s supply network, which is expected to increase the uptake of Internet services and ease access to power especially in rural areas. Neighbouring countries will also benefit from the venture.
The fibre cable called dense wavelength division multiplexing (DWDM), has a larger capacity compared with UETCL’s current infrastructure, installed in 2003.
The new capacity is estimated at 1,920 cores, a feature that allows connections to a number of Internet service providers, with little risk of congestion, ICT experts said.
The old infrastructure has 24 cores that accommodate a maximum of 12 clients each. The new one will cater to as many as 80 clients on a single core.
The data connectivity speed on the DWDM link is also estimated at 100 gigabits per second, compared with average connection speeds of 70-80 gigabits per second on the old cable.
ZTE will finance the infrastructure project to the tune of $2.5 million.
UETCL’s current fibre optic cable supports various telecom companies that offer Internet services. Beneficiary operators rent space for data transfer links on its pipe section that covers hundreds of kilometres between the border town of Malaba and Kampala city.
The cable is overlaid on UETCL’s wide network of high-voltage power lines, passing above trees and multi-storeyed buildings — an installation option that has lower setup costs compared with digging up kilometres of the landscape. It also offers stronger security features.
The ZTE deal was informed by the need for a more efficient service platform in the information and communications technology sector, driven by the entry of new players and growing demand for data, as more people acquire smartphones and other Internet-ready devices.
The latest entrants in the country’s data services market are Smile Telecom, Vodafone Uganda and Smart Telecom. Total sales of smartphones exceeded a million units in 2013, according to statistics by global audit and accounting firm Deloitte.
It is expected that the planned expansion of UETCL’s infrastructure will further stimulate electricity and data supply services across the country and within neighbouring countries, observers said.
Construction works will take place in two phases, and are scheduled to last more than a year.
The first phase covers Kampala, Jinja and Tororo district and has a direct link to Kenya through Malaba town — a key connection point for undersea fibre optic cables serving the two countries. The second phase includes Soroti, Lira, Masaka and the Fort Portal-Hoima area, and will be connected to Rwanda through Mirama border post, UETCL officials said.
However, questions over projected revenues and returns on investment remain unanswered, with UETCL and ZTE executives reluctant to discuss the matter.
UETCL’s managing director Eriasi Kiyemba, however, said that the project would complement development of the ICT sector while the use of high voltage power transmission lines will bring down infrastructure set up costs and enable small ISPs to have access to cheaper Internet links.
“As a result, local consumers will eventually benefit from lower user costs charged on data products. We expect this venture to yield strong returns after 3-5 years of operation,” said Mr Kiyemba.
ZTE Uganda project manager Jesse Pepsi Birungi said that the firm had no plans of reaching out to heavy data users like the National Social Security Fund “because we are not ambitious about competing with local ISPs for market share.”
But Brian Buzu, an ICT specialist at local ISP firm Datanet Ltd, said that while the advanced fibre link would accommodate more ISPs, translating into an expanded client capacity, user charges are unlikely to come down.
“Weak regulation of wholesale bandwidth suppliers means they levy high rates for their data packages without restraint plus there is limited sharing of price information among ISPs served by existing fibre optic cable operators,” said Mr Buzu.
Internet penetration rate increased from 20.7 per cent in 2013 to 42.5 per cent in 2014 out of a total population of 34.6 million people, according to research data compiled by the Uganda Bureau of Statistics.
Meanwhile, the government has committed some $1 billion for the expansion of the transmission network, mainly for transferring future electricity supplies from the Karuma and Isimba power dams.
For example, a 400 KV power line connecting Karuma dam and the South Sudan border awaits construction works prior to commissioning of the dam with the aim of extending power supply and data services to the country’s northern neighbour. However, cost estimates for this project were unavailable at press time.
Roughly 15 per cent of the Ugandan population has access to electricity. The majority use firewood and paraffin for their cooking and lighting needs.