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BTRC has formed Teletalk Bangladesh Ltd. on behalf of the government with
an aim to bring price levels down and make cellular technology available to
the mass public. The industry is also set to accept several more players,
with licenses to operate PSTN or fixed phone lines in the upcoming months.
While the market for mobile phones, specifically, has been growing steadily
since its introduction back in 1993, in the past 18 months the market has
more than doubled, growing from 1.5 million subscribers in early 2004 to
4.2 million at the end of 20051.
1
http://news.yahoo.com (April 21, 2005)
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Historical Background
Capital Composition
Among the four initial investors, only Norwegian Telenor & Grameen
Telecom remains as the existing shareholders. The total capital of
GrameenPhone now remains US $ 125 million.
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Telenor As
Grameen Telecom
Grameen Telecom, with the help of Grameen Bank, administers the village
phone services to the villagers and trains them regarding all service-related
issues. Its objectives are to provide easy access to telephones in rural
Bangladesh as well as introduce a new income-generating source for the
poor villagers.
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f
Financial Structure
Equity: USD $56 MM
Telenor 62 %
Grameen Telecom 38 %
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Senior Lenders
Debt: USD $ 25 MM
IFC
Nor Fund
Table 2: Debt ADB Composition of
GrameenPhone Ltd.
Debt: NOK 75 MM/USD $ 12
MM
Company Performance NORA
Year Achievement
Mar 97 Launch
Jun 00 Coverage of all 64 districts
Jun 00 100,000 Subscribers
Aug 03 1 Million Subscribers
Sept 04 2 Million Subscribers
Apr 05 3 Million Subscribers
Nov 06 10 Million Subscriber
The organization earned 350 MM USD in 2004, 500 MM USD in 2005 and
targets to achieve 700 MM USD in 2006.
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Source: Internal Records
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Achievements:
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Jun 2000-100,000 subscribers.
Dec2001-Expect to achieve the coverage of the whole
country.
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A comparative scenario of GPs market growth
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Vision, Mission, and Goals
Company Vision:
Company Mission:
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Company Objective:
Company Strategy:
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GP Coverage:
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Investment Scenario:
Year Achievement
1997 0
1998 10 MM USD
1999 28 MM USD
2000 23 MM USD
2001 52 MM USD
2002 51 MM USD
2003 60 MM USD
2004 189 MM USD
Total 465 MM USD
Target 750 MM & 900 MM USD by
2005 and 2006 end.
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Organizational Structure:
GrameenPhone is divided into several departments namely Technical, Sales & Distribution,
Marketing, Customer Relations, Administration, Human Resource, Finance, IT, FON,
Information & Supply Chain Management.
Board of Directors
Kafil H. S. Muyeed
Director Marketing (49)
Syed Yamin Bakht
GM Information (2)
Ingvald Lyche
Director Sales and Distribution (114)
Ahmed Raihan Shamsi
Company Secretary & GM Internal Audit (4)
N K A Mobin
Director Finance (91)
Khalid Hasan
Stein Nvdal-Larsen Director Corporate Affairs (48)
Director Information Technology (79)
Emad Ul Ameen
Yogesh Malik Director Human Resources (18)
Chief Technical Officer (380) + BR (140)
Frank Fodstad
Deputy Managing Director (320)
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SWOT Analysis
Strengths Weaknesses
Opportunities Threats
New and better interconnection Import duty of Tk. 1200 on every SIM
agreement card
Economic growth of Bangladesh More rigid government regulation
Huge need for telecom services More influence of competitors on the
fixed network.
Declining prices for handsets Non-cooperation of government and
fixed PSTN operators
Price war
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Competitive Environment:
Very recent thread is UAE based giant warid telecom with more than 2
billion investment.
Organizations are slowly realizing the potential of the telecom market. This
is quite evident from the number of foreign investors eyeing Bangladesh as
a place for potential investment. Telenor, a leading Norwegian company
owns a majority stake in GrameenPhone, and Telecom Malaysia went into
joint venture to form AKTEL. Then OTH, a leading telecom provider in the
Middle East purchased 100% equity of Sheba Telecom and renamed it
Banglalink and now SingTel buys a huge portion in City Cell.
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Threat of Substitute Products:
Mobile phone operators are constantly under the threat of being replaced
by new technology. Plus at the beginning of the year, BTRC approved the
licenses of 19 private companies to operate PSTN lines, which will enable
them to provide fixed phone lines similar to BTTB in all regions of the
country.
With prices coming down significantly everyday and switching cost coming
down mobile phone operators have to worry about maintaining their
customers. It is likely that customers can expect to see more changes in the
industry, with many more players fighting for market share. This will give
them opportunity to choose from a number of packages from any operator
they wish.
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Contribution to Society
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Set up in 1997, the Village
Phone Program has continued
to grow at a robust pace over
the years. By the end of 2004,
the number of Village Phone
subscriptions stood at 95,000,
in 61 districts. The average
earning of a Village Phone
Operator is about BDT 5000
per month, which is more than
twice the per capita income. GrameenPhone also actively participates in
promoting different socio-cultural activities and sports events in the
country. It sponsored many activities over the years including the Zainul-
Quamrul International Childrens Art Competition, the 11th Asian Art
Biennale, publication and launching of an anthology of contemporary
Bangladeshi paintings, the Independence Day '04 Photography & Painting
Exhibition, and many other activities.
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President Cup Golf Tournament, and sponsors the visits of newspaper
reporters abroad to cover major sports events.
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