presented by:
Madhuri Krishnan
Sarvesh Gupta
Aman Sinha
Saikishore Pulugurta
Neha Chugh

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Telecom Revolution is sweeping Bangladesh
 Grameenphone Limited (“GP”, the “Company”) was established in 1996 and commenced services on March 1997 as a joint venture between Telenor of Norway and Grameen Telecom
 GP is a strong wireless operator in Bangladesh with approximately 20.3 million subscribers at June 30, 2008 with 46.5% of the Bangladesh wireless market
Telecom Market Share
Grameen Subscriber Base
 Overview of number of lines
 700,000 fixed lines ( 90% in service)
 BTTB (Government monopoly)
 Telephone density : 0.5 lines per 100 population
 one of the lowest in the world
 Average telephone density is 0.05 per 100 people in rural areas
 800,000 mobile cellular telephones
 impressive growth; >100% CAGR
 16,000 village phones in 15,000 villages providing teleaccess to 30 million people
Maximize gains for villagers in several ways.
 First, access to a cell phone at low cost has empowered villagers significantly in their work domain.
 Second, the program has led to the empowerment of the phone operators, primarily poor rural women, who now command respect in the village community by virtue of their new-found economic
 Impacts/Results
Saving Time and Money
Ensuring Safe Transmission of Funds
Enabling Social Contact
 Health Sanitisation and Medical assistance
 Usage Pattern of Village Phones
 Key Factors/Issues
 Rural service can be promoted through existing successful channels
 Rural consumers will pay a market price if the service is of value
 Gender plays a significant role in rural telecom services
 NGOs can play an expanded role in rural telecom services
Challenges
 Affordability of rural telecommunication services
 Political obstacles and social challenges faced by the VP operators
 Grameen Revolution
 Analysis
 Importance of Customer Interface
Rise of “PROSUMER”……Toffler (1980)
 Role of Customer & Employee
Who is the Customer
Who is the Employee?
 Generally Women as 95% of GB members are women.
 Poorer than Avg HH
 Phone installed in Women’s House – other Household responsibilities
 Traditional Islamic Society – woman are more comfortable interacting with women VPOs
 Customer Interface in GTC
 Customer Oriented Service Delivery
 Develop People to Deliver Service Quality
 Empowering employees
 Allowing flexible pricing in call rates
 Assisted by rate cards
 Rate cards ensure that the VPO does not price herself/himself out of the market
 Social empowerment
 By generating employment, the VPO operators act as entrepreneurs
 They can help generate wealth and employment for other villagers
Promoting Teamwork
 Monthly meeting of grameen bank employees and other VPO’s from the surrounding area
 Customer service helpline : trained villagers act as customer service executives
 Training for technical and interactive skills
 Villagers are trained to act as
 VPO’s
 Phone servicing agents
 Helpline operators
 Cybercafé owners
 Hire the Right People
Hire for service competencies and service inclination
 Villagers are chosen by the bank for VPO operations
 For the job of operators of help lines, only those villagers are chosen who show the right attitude and ability
Compete for the best people
 The association with grameen phone, is a very respectable, profitable and hence desirable one
 Competition is therefore greatly reduced
 VPO Selection Process
 Service Model
 Infrastructure
 Cost Structure
 GTC treats GP and the VP program as one customer buying airtime in bulk at discount
 Issues single summary Bill in English aggregating airtime of all VPOs
 GTC bears Marketing and Advertising Cost
 GTC provides Handset, Provides Support Training and Repair
Cost Incurred: GP
 Communication Infrastructure
 Technical Support
 Provision of Airtime (@50% discount)
 Provision of Bulk Bill to GTC
 Govt Licensing and regulatory compliance & Liasion
 Govt Financial and Taxation Liasion
Revenue Stream
 Phone Handset $135
 Fixed Line Rent – 40 taka
 Phone Charge – 2.24 taka (peak hours) to 1.24 (off hours)
 Avg Monthly VP Bill 5200 taka
 Avg Net Income of VPO 4000 taka
Revenue Stream
 Assured because only Grameen Bank customers are given VP
 GB has repayment rate of 98.95%. Its model of Group Loans and blacklisting entire group even if one defaults makes it very difficult to default in a tightly integrated village community.
Low churn rate
 Average Revenue per VPO double of ARPU in Urban Dhaka circle (but GP depends on Urban Phone Network)
 Avg VPO Profit $2 per day ($700/year) after all Costs – more than double the National Per Capita Income
Service Profit Chain
 Profit and growth are stimulated primarily by customer loyalty.
 Loyalty is a direct result of customer satisfaction. Satisfaction is largely influenced by the value of services provided to customers.
 Value is created by satisfied, loyal, and productive employees.
 Employee satisfaction, in turn, results primarily from high-quality support services and policies that enable employees to deliver results to customers
Working of Profit Chain
 Making it Affordable
 50% discount – exclusive priviledge of GTC to GP
 GTC’s biggest Corporate Social Responsibilty Initiative
 Allows GTC to cover its Cost and VPO to make profit
 Shared Access Model Concentrates Demand and Aggregates Purchasing Power of Villagers
Take Aways
Key Lessons Learnt
 Shared infrastructure models Concentrate Demand & Aggregate Purchasing Power of BoP making this segment Profitable
 Involving customers in service delivery will increase the acceptability.
 Encouraging Entrepreneurship: VPOs having income almost double to average Bangladeshi income.
 Use of WLL over technology used could have given them greater profitability.
Indian Feasibility
Indian Context
 Strong BSNL backbone network
 Affordable Rates (even for urban users )already existing
 Existing players – Very bullish in rural front
 Technology used is already WLL
V/S
 Will provide platform for Rural Entrepreneurship and education
 Drastic Connectivity and Network improvement
Limitations
 Research Data available till Year 2005 for some areas.
 Service Model specific/restricted to Geography.