UCC says unauthorised internet resellers undermine tax collection, consumer protection and telecom infrastructure, while MTN Uganda urges a balance between affordable data and sustainable network investment.
The Uganda Communications Commission (UCC) has raised concerns over about 4,000 unlicensed public Wi-Fi operators, citing an estimated Shs148 billion in annual tax revenue losses and risks to telecommunications infrastructure.
UCC Executive Director Nyombi Thembo said the commission had assessed the operators and was pursuing measures to address businesses reselling internet services without the required authorisation.
“These operators are not providing affordable internet; this is an economic crime,” Thembo said.
The operators reportedly buy high-speed internet from licensed providers and resell it to the public at lower prices without the necessary regulatory approvals or payment of applicable taxes.
According to UCC, licensed providers charge an average of Shs2,000 per gigabyte, inclusive of taxes and other costs, while unlicensed resellers charge about Shs1,000 for the same volume.
The commission argues that the practice deprives government of revenue and creates an uneven operating environment for licensed telecommunications companies, which invest in network infrastructure and meet regulatory obligations.
UCC has previously announced enforcement against unauthorised public Wi-Fi services, saying operators must comply with the country’s communications regulations. However, Thembo said in an interview reported on October 5 that recent arrests and seizures were not initiated by the commission but followed complaints from licensed internet service providers.
The commission has also been engaging operators over the regulatory concerns and their complaints about enforcement, with further guidance expected as it reviews the issues.
UCC has said it is working with the Uganda Revenue Authority to address the importation of telecommunications equipment by unlicensed operators. Enforcement measures could include identifying unauthorised installations and seizing equipment, subject to applicable legal procedures.
The commission has urged operators to regularise their businesses or discontinue services that do not meet regulatory requirements.
Beyond the alleged revenue losses, UCC has cited consumer protection, national security and safety concerns associated with unlicensed public Wi-Fi services.
The commission says users of such hotspots may lack guaranteed service-quality standards, reliable complaints mechanisms and clear avenues for redress when services fail or personal data is misused.
It has also raised concerns about operators mounting routers on electricity poles and telecommunications infrastructure belonging to other companies without authorisation.
Such installations can expose technicians to electrocution risks and interfere with maintenance work on electricity and fibre networks, according to the commission.
UCC has further warned that some services may operate outside established subscriber-registration and lawful-interception frameworks, potentially complicating investigations where internet users are linked to incidents requiring police attention.
Customers using the hotspots could face service interruptions if operators are required to shut down or remove non-compliant equipment. The commission has also cited potential data-privacy and cybersecurity risks.
MTN Uganda Chief Executive Officer Sylvia Mulinge has called for a sustainable approach to lowering internet prices, warning that affordability measures should not undermine the investments required to maintain network quality.
Mulinge said telecommunications companies faced growing pressure to make data more affordable as Ugandans increasingly rely on digital platforms for communication, business, entertainment and other services.
“We must do it in a manner that is sustainable,” she said, arguing that the cost of providing telecommunications services must be balanced against what consumers can afford.
She said operators were accountable for service quality, with UCC monitoring their performance.
“We are held to very high accountability in terms of provision of quality services, and this is something that the Commission measures us on,” Mulinge said.
She added that telecommunications companies were expected to continue exploring ways to reduce prices and expand access to data services.
Mulinge acknowledged that customers wanted more affordable products, saying MTN would consider their feedback as it explored ways to improve affordability.
However, she cautioned against price reductions that could make it difficult for operators to maintain the infrastructure needed to deliver reliable services.
Using the example of a hostel, Mulinge said consumers wanted good facilities and convenience but also needed to recognise that maintaining such services came at a cost.
She called for continued engagement among telecommunications operators, the regulator and consumers to develop an approach that balances affordability with investment in network infrastructure.
“The production side and the consumption side must be able to balance,” she said.
Her remarks come amid growing demand for affordable internet access, with more Ugandans using platforms such as TikTok and Instagram for communication, content creation and business.
Mulinge said the challenge for the sector was to deliver better-quality services at prices consumers could afford while maintaining a business model that supports continued network investment.
MTN said it was willing to continue discussions through UCC on how to achieve that balance.