Bangladesh is now a land of about 165 million people. Since 1990s the country has been experiencing a rapid growth in its economy and business at a rate higher than any time in the past. The credit for this vibrant growth mainly goes to the readymade garments (RMG), remittances and export-oriented industries. The telecommunication sector has been playing a big role in the economy, especially following the introduction of cellular mobile phone service.
Bangladesh introduced cellular mobile phone service after India and Pakistan. In the huge mobile phone market in Bangladesh there are 6 operators: (i) Citycell (joint venture with SingTel Asia-Pacific Investment Limited), the first mobile communication company of Bangladesh, was set up in 1993 and it is the only CDMA network operator in the country; (ii) Grameenphone, popularly known as GP, a Norwegian company (stake of the Norwegian Telenor is 55.8 per cent; Grameen Telecom has 34.2 per cent share and public share is 10 per cent), came into Bangladesh in November 28, 1996; (iii) Robi (stake of Axiata Group Berhad is 70 per cent and that of NTT DoCoMo is 30 per cent), came in 1997; (iv) Banglalink, a subsidiary of Egypt-based Orascom Telecom, started in 2005; (v) TeleTalk, the only state-owned company, started operating on December 29, 2004; and (vi) Airtel (formerly Warid, stake of Bharti Airtel is 70 per cent and that of Warid Telecom 30 is per cent), launched commercial operations in 2007.
Bangladesh introduced cellular mobile phone service after India and Pakistan. In the huge mobile phone market in Bangladesh there are 6 operators: (i) Citycell (joint venture with SingTel Asia-Pacific Investment Limited), the first mobile communication company of Bangladesh, was set up in 1993 and it is the only CDMA network operator in the country; (ii) Grameenphone, popularly known as GP, a Norwegian company (stake of the Norwegian Telenor is 55.8 per cent; Grameen Telecom has 34.2 per cent share and public share is 10 per cent), came into Bangladesh in November 28, 1996; (iii) Robi (stake of Axiata Group Berhad is 70 per cent and that of NTT DoCoMo is 30 per cent), came in 1997; (iv) Banglalink, a subsidiary of Egypt-based Orascom Telecom, started in 2005; (v) TeleTalk, the only state-owned company, started operating on December 29, 2004; and (vi) Airtel (formerly Warid, stake of Bharti Airtel is 70 per cent and that of Warid Telecom 30 is per cent), launched commercial operations in 2007.
According to Bangladesh Telecommunication Regulatory Commission (BTRC), the number of mobile phone subscribers in Bangladesh as of February 2009 was 45.21 million which reached 85.455 million at the end of December 2011. Considering the annual revenue and number of subscribers, GP is clearly the market leader followed by Banglalink, Robi, Airtel, Citycell and Tele Talk. So, it is crystal clear that the private-owned telecoms are dominating our market. The incentives both from the government and the private sectors have contributed to the growth of this industry. It is now one of the biggest sectors of Bangladesh. The vast market of telephone in populous Bangladesh has enticed many investors, both foreign and local, to invest in this sector.
However, the state-owned TeleTalk remains a back bencher in the mobile phone business with only 1.218 million customers out of 85.455 million at the end of December, 2011. TeleTalk is the weakest competitor in the market with only a 1.43 per cent market penetration. When TeleTalk first came into operation it brought in a hope among the people. The mission statement of TeleTalk is "Desher Taka Deshey Rakhun" (Keep your money in your country) but ultimately it could not retain its customers' expectation with a weak network service in this highly competitive market. TeleTalk had 1.147 million subscribers as up to July, 2010 which shows the growth rate of subscribers is hardly increasing.
However, the state-owned TeleTalk remains a back bencher in the mobile phone business with only 1.218 million customers out of 85.455 million at the end of December, 2011. TeleTalk is the weakest competitor in the market with only a 1.43 per cent market penetration. When TeleTalk first came into operation it brought in a hope among the people. The mission statement of TeleTalk is "Desher Taka Deshey Rakhun" (Keep your money in your country) but ultimately it could not retain its customers' expectation with a weak network service in this highly competitive market. TeleTalk had 1.147 million subscribers as up to July, 2010 which shows the growth rate of subscribers is hardly increasing.
Strategically it is wise to keep the vital sectors like power, irrigation, telecommunication, energy, gas etc reserved for domestic investment. But for rapid economic expansion FDI was allowed in our telecom market. Now we are experiencing the outflow of return on FDI in the name of dividend and divisible profit from the telecom sector. The public company is not, however, capable of generating a vibrant profit by competing with its rivals.
Russia's AFK Sistema and UAE-based telecom operator Etisalat showed interest to buy stakes in the state-run TeleTalk. Recently Vietnam's Viettel also wanted to invest $250 million in TeleTalk. However, nothing has happened as yet.
TeleTalk should undertake a fish-bone analysis to detect its problems. But at first it should seek and attract investors so that there arises no liquidity crisis at the time of resuscitation. Then a huge development of network coverage is needed. By keeping the privilege of 3G in mind TeleTalk can make contract with modern engineering and technological companies of developed countries. A strong customer-based marketing strategy (advertising, sponsoring, strategic partnership, CSR etc.) should be formulated. A chain of customer service centres should be developed throughout the country with optimum number of smart and vivid customer care associates. The cost efficiency and effectiveness should be kept in mind. To do all this, a partial or complete change in management team and corporate strategy may be necessary. Corruption, inefficiency, mismanagement and political interference should be reduced to the minimum.
Before creating expectation TeleTalk must develop ability to satisfy those expectations of the customers. If necessary, the brand name and logo might be changed. Eventually, if TeleTalk can give all the facilities that its rivals do and for once the customers are convinced that it is our phone, let us talk through this phone and contribute to the country by keeping the money in the country; then TeleTalk will patently become the market leader in country's telecommunication.
This article was published in The Financial Express, Views & opinions (Saturday, March 24, 2012)
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