Telecom

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Telecom Industry of Pakistan Pakistan is on the verge of Telecom revolution Pakistan continues to be one of the fastest growing telecom markets in the world. Reforms introduced by successive Pakistani governments over the last decade have dramatically changed the nature of telecommunications in the country. , the Pakistani telecom sector has attracted more than $9 billion in foreign investments. During 2007-08, the Pakistani Communication sector alone received $ 1.62 billion in Foreign Direct Investment (FDI) – about 30% of the country’s total foreign direct investment. Telecom industry has contributed a great deal to Pakistan’s economy and has called for great investments that lead to a new era of progress. Telecom sector is seeing extraordinary growth in Pakistan. With increasing levels of mobile penetration Pakistan is fast evolving as one of the telecom sector's key investment prospects. Continued market liberalization is reshaping the regulatory environment, creating a more investment friendly climate in telecom sector of Pakistan. The sector is said to be growing at a very fast pace on yearly basis. This growth rate of telecom sector is mainly because of the mobile phone service providers’ entry in the industry for the last few years. As of July 2009, the mobile phone subscribers are 95.54 million in Pakistan and, in fact, still Pakistan has the highest mobile phone penetration rate in the South Asian region. Hence, due to the huge potential in Pakistan’s mobile phone sector, the industry and customers are experiencing an intense competition, a battle for supremacy in the mobile phone industry, between all mobile phone service providers of Pakistan. Telecommunications in Pakistan describes the overall environment for the growing mobile telecommunications, telephone, and Internet markets in Pakistan. Pakistan’s telecommunication market is one of the hottest in the emerging economies. However, this report will briefly review the mobile phone sector of the country, its growth and future prospects. Pakistan is still an unsaturated market and with the falling cost of handsets there are plenty of new subscribers to go for. But eventually as in saturated markets, if mobile operators want to avoid simply competing on price, they will have to compete on superior service, innovative features and ease of use. Despite tough working conditions and hit on national economy due to floods and inflation, telecom sector exhibited stability in the FY 2011 as revenue of telecom operators swelled to an all-time high Rs. 363 billion in 2011, at the end of financial year, it was revealed in Pakistan Telecommunication Authority (PTA) report.

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Revenues of the telecom sector reached all-time high during the FY 2011 as these touched the mark of around Rs. 363 billion, registering boost of 5.4% compared to the year before. During FY 2011, cellular revenues enhanced by 11% to reach Rs. 262,761 million in comparison with Rs. 236,047 million last year. Rise in telecom revenues is mainly attributed to the swelling of revenues of mobile services, as other services except WLL have reported reduction in their total revenues.

Role of Telecom in a Country: Telecommunication Services play a key role in the growth of economy, facilitating efficiency and growth across the wide range of user’s industry in any country. The level of Telecommunication development is a determining factor for economy, social and cultural development of a country.

Major competitors: Here’s a brief description of the top mobile companies in Pakistan. At the top is Mobilink, the Pakistani unit of Egypt-based telecom company Orascom. It has been operating in Pakistan since 1994. Ufone, a wholly owned subsidiary of Pakistan Telecommunication Co. Ltd (PTCL), is now under the control of Etisalat group of UAE. Warid, owned by the Abu Dhabi group of the United Arab Emirates and sister of Wateen group is another cell phone service provider in the industry. Norway’s Telenor, a recent entrant with about a billion US dollar investment in Pakistan has been doing well, based on its recent earning report. Telenor stock is listed in the Oslo stock market (TEL) and in US. Zong, formerly Paktel, was the latest target of foreign acquisition. After it got acquired by China Mobile it was rebranded as Zong and launched one of the most successful and aggressive campaigns.

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Mobilink
Introduction: Pakistan Mobile Communications (Pvt) Limited, better known as Mobilink GSM, is a telecommunication service provider in Pakistan. The company is Pakistan's leading cellular operator with a subscriber base of 31.5m and market share of 31% in October 2010. Mobilink, a subsidiary of the Orascom Telecom Group is Pakistanss leading cellular service and market leader with an unmatched customer base of over 30 million subscribers. Mobilink has successfully achieved a record subscriber growth of 40 % in 2007 and with over 6000 cell sites, has coverage in over 7,000 cities, towns, and villages, through out Pakistan. International roaming is available in over 127 countries with more than 300 partner operators, and the company's investment to date, is over US $2.5 billion. It directly employs over 4,500 people, and facilitated through an integrated technology infrastructure, has the largest distribution network of over 200,000 retail outlets across Pakistan. The company is a carrier-class nationwide connecting service with its 6,500 kilometers fiber optic backbone, and is leading the Mobile Commerce revolution with its first lifestyle application, "Genie" which enables customers to pay utility, telephone bills and top-up prepaid credit through their mobile phones. Mobilink's Head office is located in Islamabad. Mobilink started operations in 1994 as the first GSM cellular Mobile service in Pakistan by Motorola Inc. later it was sold to Orascom Telecom, an Egypt-based multi-national company. In addition to cellular service, the Orascom group is diversifying its service portfolio by setting up new businesses and also expanding through acquisitions.

Mobilink Analysis: Mobilink GSM is a flourishing company & Mobilink is responding in a very positive way to the existing threats and opportunities in the telecom industry. Mobilink uses Technology and Innovation and Price Competitiveness as compared to its competitors. Telenor and Ufone. Overall Mobilink GSM is strongest, closely followed by Telenor and Ufone. Overall, Mobilink GSM has has room for improvement in factors such as low motivation and low employee morale due to cost – cutting programs and employee termination and call blockage service is still not being offered though all the competitors have taken this step.

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Mobilink Strategy: Mobilink maintains market leadership through cutting-edge, integrated technology, the strongest brands and the largest portfolio of value added services in the industry.

Mobilink Culture: Employee volunteerism is a core value of Mobilink’s Culture of Excellence and employees are strongly encouraged to develop a humanitarian spirit. Mobilink's corporate values serve as the foundation for its culture, behavioral norms, and decision making. These values have always been at the heart of Mobilink’s business principles and success.

Competitive Advantage: • • Best HRM of Mobilink only Cellular Service Provider in Pakistan which provides BlackBerry®

HRM Department of Mobilink: HR Functions at Mobilink: • • • • • • • • • • • Planning Recruitment Selection Training & Development Compensation Performance Appraisal System Occupational Health and Safety measures Career Planning and Development Research and Development Reward Management Employee Relations

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Ufone
Ufone GSM is a Pakistani GSM cellular service provider. It is one of five GSM Mobile companies in Pakistan and is a subsidiary of Pakistan Telecommunication Company. It has a subscriber base of 20.05 million as of July 2009. It is currently owned by United Arab Emirates based Etisalat. The company commenced its operations under the brand name of Ufone from Islamabad on January 29 2001. Ufone expanded its coverage and has added new cities and highways to its coverage network. PTML is a wholly owned subsidiary of PTCL. established to operate cellular telephony. The company commenced its operations, under the brand name of Ufone from Islamabad on January 29 2001. During the year, as a consequence of PTCL’s privatization, 26% of its shares were acquired by Emirates Telecommunication Corporation (Etisalat). Being part of PTCL, the management of Ufone has also been handed over to Etisalat. During the year July 2005 to June 2006, further expanded its coverage and has added new cities and highways. Ufone has network coverage in more than 750 cities, towns and across all major highways of the country. During the year Ufone completed the network expansion of Phase 4 in existing as well as in new cities and towns which amounted to more than US Dollar 170 million. As a result the asset base of the Company has increased from Rs. 20 billion to Rs. 27 billion. During the year Ufone adopted the policy of simplified tariffs with no hidden charges, which resulted in positive impacts on the usage trends of subscribers as well as total subscriber base, which has increased from 2,579k in June 2005 to 7,487k in June 2006. Ufone currently caters for international roaming to more than 195 live operators across 119 countries and introduced International roaming facility for Prepaid subscribers in Saudi Arabia, United Kingdom, United Arab Emirates, Singapore, Portugal and Kuwait with lowest rates, featuring no security deposit and activation charges. GPRS Roaming facility is available with more than 75 Live Operators across 59 countries. The company has also been awarded a new License for providing cellular services in Azad Jammu & Kashmir and the Northern Areas.

Ufone Culture: Ufone is a dynamic organization with an equally empowering culture that allows people to make the most of their skills, personality and career. As a company we deliver solutions that drive business value, create social value and improve the lives of every customer.
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The Ufone culture thrives on creativity and making things happen in a fast paced yet friendly working environment. You too can become part of this dynamic culture and start exploring the limits of your potential in an environment that embraces diversity and promotes mutual trust and respect. All of this is reflective of the set of core values outlined below: • • • • • Leadership with Passion Entrepreneurship freedom with responsibility Teamwork and Innovation Commitment and Fun Humility in Relationships

Competitive advantage of Ufone: It’s an advantage over competitors gained by offering consumers greater value than competitor’s offer. Ufone strategies to gain more and more competitive advantages. It also uses these competitive advantages well enough for its promotion. Currently Ufone is enjoying the following competitive advantages:• • • • • Lowest overall call rates Value added Services (VAS) Call block service Corporate color Effective advertising

Challenges for Ufone: Ufone face many challenges with the ever growing needs of telecommunication. It must remain profitable with the decreasing economic situation of Pakistan. It must grow as well in these dark times if it has to remain IN the market. Ufone face very strong competition from its competitors. It must offer lowest rates with better quality service. New features and services should be introduced to make its customers loyal, happy and satisfied.

Ufone strategy:

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Ufone is penetrating its market by taking risks and aggressively promoting & advertising itself. Ad campaigns via mobile services are the toughest market to enter and survive. And in this tough market Ufone isn’t only surviving but growing at an exceptional rate. Ufone is using humorous theme in its ads which has become its benchmark. People enjoy watching, discussing and following Ufone ads the most. And it is the biggest achievement of Ufone in recent times. So it seems that Ufone strategy is differentiation and aggressiveness.

Telenor
With over 90 million satisfied customers worldwide, Telenor is one of the pioneers of mobile technology and has steadily grown to stand amongst some of the biggest cellular companies of the world. With 150 years of cellular experience and network spreading over 13 countries, Telenor is in Pakistan to offer quality of cellular communication never experienced before. They have opened their services recently in India under the brand name Uninor. The organization under coverage is Telenor, which is Norway's largest telecommunication company and one of the fastest growing providers of mobile communications services worldwide. Telenor – Paksitan, one of the leading and yet the most innovative Telecommunication Company’s in Pakistan, serving over 500 destinations in just over a year after its launch that took place on 23rd March 2005. It acquired the license of GSM service provider in Pakistan in 2004. Telenor has become the second largest cellular network in Pakistan. Telenor has its corporate headquarters in Islamabad, with regional offices in Karachi and Lahore. Telenor has successfully signed interconnect agreements with all four incumbents during December 2004, allowing its subscribers to exchange voice and data with subscribers on all active mobile networks including Paktel, Instaphone, Ufone, Mobilink and Warid.

History of Telenor: Telenor started off in 1855 as a state-operated monopoly, named Telegrafverket as a provider of telegraph services. The first ideas for a telegraph were launched within the Royal Norwegian Navy in 1848, but by 1852 the plans were public and the Parliament of Norway decided on a plan for constructing the telegraph throughout the country. Televerket began by building from Christiania (now Oslo) to Sweden (Norway was at that time in a union with Sweden) as well as between Christiania and Drammen. By 1857 the telegraph had reached
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Bergen (west coast) via Sorlandet (south coast) and by 1871 it had reached Kirkenes (north coast). Cable connections were opened to Denmark in 1867 and to Great Britain in 1869.

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The telegraph was most important for the merchant marine who now could use the electric telegraph to instantly communicate between different locations, and get a whole new advantage within logistics.

Culture of Telenor: The culture at Telenor is top down, the top employees establishes the tone of the organization. The top level employees take good care while performing any task or action, because it will have to be followed by the subordinates. Things are properly informed. There is no means of getting misinformation. Primarily culture comes from the top management. CEO of Telenor Pakistan is humble and cooperative. The employees get the message that if the top management is accommodating then the employees should behave similarly. The values of humbleness and free interaction in putting forth ideas to a harmonious culture and efficient communication. The management is easily accessible to discuss various issues. It is difficult to distinguish between them as the culture is so homogenous that it keeps everyone at par with others. The Human Resource at Telenor Pakistan is their core competency. The reason is that the employees create a culture and all the achievements of Telenor are attributed to its flexible culture. It is necessary to motivate and retain this asset of the organization. For this purpose, training and compensation is provided to employees along with other motivational techniques.

Equal opportunities: Telenor maintains a policy of non-discrimination towards all employees and applicants for employment. All aspects of employment with Telenor are governed by merit, competence, suitability and qualifications, and will not be influenced in any manner by gender, age, race, color, religion, national origin or disability.

Competitive advantage of Telenor: • • • Highly motivated employees Flexible culture Technology
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Challenges ahead to Telenor: The global telecom industry is still growing and generating large profits. Looking ahead, we expect usage of mobile and fixed voice communications to grow significantly. Broadband also represents a huge growth opportunity. However, there are challenging trends, e.g. maturing markets, financial instability, pricing pressures as well as regulatory issues. Still, well-positioned players will benefit from market growth and increased efficiency, enabling significant cash flows in the future.

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• • • • • • • •

Future of the industry and opportunities Porter’s five forces model in Telecom industry of Pakistan Economic Indicators of Telecom Industry PEST Analysis Organizational demands (Strategy, company characteristics, Culture, employee concern) Environmental Analysis(Labor force trends, Technology, Ethics & social resposability) Regulatory Environment/Issues (EEO, Justice) HR challenges

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