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TELENOR
A NEW INVESTOR IN
MOBILE INDUSTRY OF PAKISTAN
Group Members:
M. Awais
Kamran Nisar
Nazuk Rustam
Qadeer Ahmed Durrani
Rehan-ul- Manzoor Khokhar
Telenor Pakistan
Address
Telephone
Fax
Email
Web site
Position
Chief Procurement
Officer
Acknowledgement
This report is completed by the humble efforts done by all the group
members on the basis of information and knowledge that we gained from
our prestigious institution and the information that we got from the
relevant company. We would like to pay gratitude and thanks to all the
company employees who gave us information about our topic and we also
we want to thank our subject teacher Madam Tajwar Ali, who taught us a
lot about this subject and through which become able to make this
project.
Executive Summary
This report is about a mobile company Telenor. It is a multinational company and its
head office is in Norway. The company has its branches in 11 countries and is one of the
mobile leader companies in the international market. Now they have decided to expand
their business in Pakistan. In Pakistan they will introduce both mobile sets and connections.
The company has got the license-approved from the Government of Pakistan to work here.
They have stated their work and their plan is launch their product in market till March
2005.
In this report we have analyzed that as there are already four companies providing mobile
services to the customers. i.e. Mobilink, U-fone, Paktel and Istaphone, so how will Telenor
compete these companies and what strategies and plans it would make to progress in the
Market?
We got very little information from the Telenor Company office in Islamabad because they
said that the company is in working stage and it will not welcome any one to take
information relating to their future plans and other strategies until they launch their product
in the market. It is kept confidential by the company employees. Therefore the report is
made from the information and data gathered from the websites and the newspapers.
The first three chapters are based on the working of Telenor Company in their offices in
different countries, their product and services and their plans to launch in Pakistan because
Pakistan has a huge market of customers. The company had good experience of offering
affordable services to attract new customers in countries with fairly low mobile penetration.
It will bring healthy competition that will help improve service quality, reduce tariffs and
create employment opportunities and there is a lot of potential of cellular phone expansion
in Pakistan and the company want to make good operation as they already have experience
in this region. In short, the whole Pakistans telecom sector is likely to grow and improve
tremendously.
In next chapters we have explained about the Telenor setup in Pakistan, its SWOT analysis.
The analysis was based on the information we got and the trends of the mobile industry of
Pakistan. In the end we have given the problems that the company may face in future
because the time from which the company had got license of working in Pakistan. The other
mobile connection companies have lower down their rates up to zero and this appears to be
the biggest threat for the newly launching company. Then we have given some suggestion
that how the company can compete in the market and strategies it should follow.
We hope that if this report becomes the point of interest for the Telenor Company and they
just appreciate our suggestions, we will think that our work has some value and we have
succeeded in our task.
TABLE OF CONTENTS
Chapter no
Index
Page no
01
Introduction
01
02
05
03
Telenor in Pakistan
11
04
14
05
SWOT Analysis
17
06
21
Chapter # 1
INTRODUCTION
History
Telenor's origins go all the way back to 1855, and for 150 years the company has been
Norway's leading telecom player. In the 1990s, Telenor went from being a state
monopoly to become a commercial enterprise and the company is today positioned as an
innovative player in international mobile communications.
In 1994, the then Norwegian Telecom was established as a public corporation. In
December 2000, the company was partly privatized and listed on the stock exchange.
This transformation took place as a gradual adaptation to increasing competition in the
Norwegian telecom market after deregulation in the 1990s, with free competition for all
services from 1998. It has successfully defended its strong position in Norwegian
market.
Telenor's strong international expansion in recent years has been based on leading-edge
expertise, acquired in the Norwegian and Nordic markets, which are among the most
highly developed technology markets in the world. Internationalization was achieved on
the basis of strong positions in satellite communications, in mobile communications and
in domestic Internet activities. Telenor has been one of the world's leading suppliers of
satellite communications for many years. Norway and the Nordic region have been in
the forefront of the development of mobile communications, and Internet use has quickly
gained ground in this market.
Telenor is a pioneer in mobile communications. Manual mobile telephony services were
introduced in Norway in 1966, as a forerunner to the automatic NMT system, which
appeared in 1981. Its digital successor, GSM, was introduced in 1993, and third
generation mobile network, UMTS, is scheduled for commercial use within 2004.
Vision
Ideas that simplify
Mission
Telenors mission is to create value for shareholders through the serving of customers,
employees, partners and the general public interest. In long-term perspective a strong
market a customer focus, as well as a strong commitment to its employees and to the
society.
Core Values
Telenors three core values shall be at the heart of governing the conduct of its
employee-internally and externally:
Dynamic
It means having insight and active involvement, coupled with a capacity for
implementation
Innovative
It means continuously being on the lookout for new opportunities for development and
growth
Responsible
It means rasing realistic expectations, deliver as promised and stay committed to the
society, which its group is a part of.
Objectives
Telenor is committed to being both an industry leader in the management and
implementation of corporate social responsibility and to make this an integral part of its
business development. The three primary objectives for its social responsibility program
are:
Telenor's customers shall be confident that the Group runs its operations in an
ethically responsible manner
Telenor's employees shall be proud of the way in which the Group handles its
social responsibility
Strategy
Telenor is committed to meeting its corporate social responsibility in all activities. Its
efforts are based on it's Core Values; dynamic, innovative and responsible. In short, it
will be dynamic and innovative in the way it assume its responsibilities, and will be
responsible in innovation and conduct its business. Reaching these objectives is a
complex process demanding a broad approach throughout the corporation.
Geographical Scope
Over the last decade, Telenor has developed its position as a mobile operator with
substantial operations in 12 countries. At the end of 2003, the companies wherein
Telenor has ownership interests had a total of 34.8 million mobile subscriptions. The
mobile commitments outside Norway have become an increasingly important part of
Telenor's activity, and contributed to 24 per cent of the Group's external revenues in
2003.
The business areas each have defined geographical areas of priority outside Norway:
Telenor Mobile has selected countries in Europe and South East Asia as its
priority markets.
Telenor Broadcast has defined the Nordic Region as its home market.
Mobile Operations
Mobile is Telenor's principal focus area for future growth. Continued development of the
mobile
activities
is
vital
to
the
Group's
positioning
as
an
international
telecommunications player.
Telenor has ownership interest in 12 mobile operations geographically concentrated in
selected countries in Europe and Asia. In 2003, 42% of its external revenues were
derived from the mobile operations. Telenor's commitments on the international mobile
arena are based on Telenor's acquired experience and skills, and on products and services
developed and shared within Telenor's family of mobile operations.
Chapter # 2
Mobile
Mobile is Telenors business area for development and management of mobile service4s
within voice, data, Internet and cot net services in Norway and internationally
Broadcast
Fixed
Fixed is Telenor's business area for development, management and supply of
communications solutions based on the fixed network. Telenor has fixed network
operations in Norway, Sweden, the Czech Republic and Slovakia. As of 2003, the
Group's activities in Russia are run through an associated company.
Other Operations
The Telenor Group has activities in a number of areas in Norway, the Nordic Region and
internationally. Telenor has gone from being a national telecommunications operator to
become an international player with its main focus on mobile services.
Other Units
Telenor has substantial activities in addition to the three business areas, also including
various staff and support functions: EDB Business Partner, Telenor Satellite Services,
Telenor Satellite Networks, Teleservice, Telenor R&D, Telenor Key Partner, Telenor
Venture and Telenor Eiendom.
Satellite Services
Satellite Services is wholly owned by Telenor, and supplies satellite-based voice and
data services for use on land, in shipping and the offshore industry and in aviation.
Subsequent to the acquisition of Telenor Satellite Services Inc. (formerly COMSAT
Mobile Communications) in January 2002 and Marlink (formerly Sait Communications)
in 2001, Telenor Satellite Services has become one of the world's leading suppliers of
global, mobile communications solutions via satellite. The services are marketed through
a broad international chain of distributors as well as from own offices around the world.
Satellite Networks
Satellite Networks is wholly owned by Telenor, and supplies satellite-based
communication solutions and VSAT technology to the business market and national and
international organizations. The company's complete communications solutions
encompass network design, implementation, management and service. The services are
supplied through subsidiaries in Norway, the Netherlands, Slovakia and the Czech
Republic.
Teleservice
Telenor wholly owns Teleservice, and responsible for Directory Enquiries 1881,
International Directory Enquiries 1882, MeetAt 07777 (telephone and data conferences)
as well as other Contact Center services. The company aims at making information and
communications services easily accessible to users. In February 2002, the market for
directory enquiries was opened to competition in Norway, but Directory Inquiries 1881
still has a dominant position in the Norwegian market with 70% of the traffic.
Venture
Telenor Venture is seeking to create value through active ownership by investing in
companies in the fields of telecommunications and IT. Telenor Venture II ASA was
established in 2000 with the purpose of continuing and expanding the investment
activities, and in December 2002, Telenor Venture III was established to continue
activities formerly organized under Telenor Innovasjon AS and other parts of the Telenor
Group. Telenor's ownership share in Telenor Venture AS was sold at the end of 2003.
The ownership share in Telenor Venture II ASA is 50.1% and 100% in Telenor Venture
III AS. The Telenor Venture companies are managed and administered by TeleVenture
Management AS in which Telenor has an ownership share of 23.9%.
Eiendom Holding
Telenor wholly owns Eiendom Holding. At the end of 2003, the company managed
approximately 1 million square meters of owned and leased floor space spread out over
approximately 4,500 buildings. The company's main task is to ensure that the Telenor
Group has at its disposal sufficient premises to allow its main activities to be performed
in a cost effective manner.
Internal Processes
Company
Ownership Share
Norway
Telenor Mobil
100%
Sweden
Telenor Mobile
100%
Denmark
Sonofon
100%
Hungary
Pannon GSM
100%
Montenegro
ProMonte
100%
Pakistan
(License)
100%
Malaysia
DiGi
61%
Ukraine
Kyivstar GSM
56,5%
Bangladesh
GrameenPhone
51%
Thailand
DTAC
40,3%
Russia
VimpelCom
29%
Austria
ONE
17,5%
= Consolidated
= Non-consolidated
(Table shows the countries in which Telenor is providing services to its customers)
Chapter # 3
Company
Country
Telenor Mobil
Norway
Telenor Mobile
Sweden
Sonofon
Denmark
Pannon GSM
Hungary
ProMonte
Montenegro
DiGi
Malaysia
Kyivstar GSM
Ukraine
GrameenPhone
Bangladesh
DTAC
Thailand
VimpelCom
Russia
One
Austria
TELENOR IN PAKISTAN
On April 14, 2004 Telenor acquired a nationwide GSM license in Pakistan. At present
this license for mobile operation includes GSM, GPRS and EDGE. Telenor's Pakistani
company will launch a world-class mobile service platform including multimedia
services within April 1, 2005.
The license terms stipulate that by year 4 we will cover 70 per cent of Pakistan's 297
administrative Tehsil headquarters and will naturally at least fulfill the license
requirements and provide superior quality coverage.
Telenor's Pakistani mobile operator will have headquarters in Islamabad and regional
offices in Karachi and Lahore.
The GSM Association among the 12 largest mobile operators in the world ranks Telenor
with 34.2 million subscribers at the end of March 2004, based on 100% figures from the
operations. Telenor has owner shares in mobile operations in 11 countries across Europe
and Asia in addition to the license in Pakistan. The family of mobile operations benefit
from economy of scale and sharing of knowledge and best practice initiatives across all
the companies. The CEO of the Telenor said:
We are proud to build mobile communication
infrastructure in Pakistan and very much look
forward to combining our experience in mobile
technology with the local Pakistani high level of
competence. Our primary aim is to offer top quality
mobile services and promote healthy competition in
the mobile market
Norway's software & telecom firms had evinced keen interest in working closely
with Pakistani firms to forge joint partnerships in the telecom & IT sector.
The quality of the software products being demonstrated indicates clearly that
Pakistan can position itself very strongly on the world map as far as this sector is
concerned
Telenor is one of the two new entrants in the competitive mobile sector in
Pakistan, and this has paved the way for other Scandinavian countries to look at
Pakistan as a potential business partner.
Telenor is the 12th largest mobile operator in the world, and that they have
entered the Pakistani market after carefully evaluating the political and economic
risks.
The company will bring healthy competition that will help improve service
quality, reduce tariffs and create employment opportunities
The company had good experience of offering affordable services to attract new
customers in countries with fairly low mobile penetration.
There is a lot of potential of cellular phone expansion in Pakistan & the company
want to make good operation as they already have experience in this region.
Technology:
Handset Code:
Network Code:
Network Status:
Web Site:
Chapter # 4
GSM 900/1800
TELENOR
410 06
Planned March 2005
www.telenor.com/pakistan
Hughes Global Services (HGS) leased the satellite to the Government of Pakistan in July
2002. The satellite is in position at the Pakistani-licensed orbital location, 38 degrees
East longitude. Paksat 1 is operational and ready to offer services.
Paksat 1 has a scheduled service outage, which occurs during eclipse season - 44 days
twice a year - when the satellite loses sight of the sun. The outage is always centered on
satellite local midnight and ranges between a few minutes up to 2.5 hours at it's
maximum. During most of the eclipse season the satellite can be used for more than 22
hours per day giving annual availability greater than 97%. Business day uses are
unaffected by the outage, and since the outage is always around satellite local midnight
most users are unaffected. The chart below illustrates the high availability for the
service. Outside of eclipse season the satellite is available 24 x 7.
In short - Paksat 1 is a great opportunity but it wont be suitable for everyone because of
the scheduled outages. However, the capacity is priced to sell.
Terrestrial connectivity
TV play out
MPEG encoding
Conditional access
Chapter # 5
SWOT ANALYSIS
Strengths
1. Co-Operation And Obligations
To facilitate this, Telenor will listen to, and widen its dialogue with customers,
investors, authorities, Non-Governmental Organizations (NGOs), experts and
other relevant stakeholders.
and
the
European
Telecommunications
Network
Operators'
Its products and services are beneficial and enjoyable for users in all age groups,
serving customers with different needs and preferences and with different
functional abilities.
thought that SMS should become such an integral part of the way young people
communicate?
They acknowledge their responsibilities to user groups that have special needs,
and recognize that parents and schools have special concerns regarding safe use
of information technology for young people.
Telenor also focuses on developing products and services of high utility value for
our society. Additional to the business areas' own product development
Telenor's Research and Development unit, Telenor R&D, also plays an important
role, not least through its projects focusing on the social aspects of information
and communications technology. Special emphasis is placed on users with
reduced functional abilities.
They are making a consistent effort to attend to the Group's corporate social
responsibility in a comprehensive and innovative way.
Telenor's ambition is to be a leading company in this field, and in the way will
integrate a socially responsible approach into its operations and business
development.
They seek an active dialogue with its stakeholders regarding Telenor's activities
and commitments related to its social responsibility.
Weaknesses
As the company has not yet started work in Pakistan so we cannot explain its weakness
and as the data gathered from its employees and management as well as from the web
does not shows any point, which appears to be its weakness.
Opportunities
1. Nokia Helps Telenor To Set Up GSM Network In Pakistan
Nokia, the worlds largest mobile phone maker, has signed a deal with Norways Telenor
to set up and run a GSM network in Pakistan, to commence operations in the second
quarter of 2005. No value for the contract was disclosed, but analysts said it was likely
to be worth over 100 million euros ($124 million).
The network will first cover central and northern Punjab. In addition to radio base
stations and infrastructure, the Finnish giant will deliver a complete turnkey network and
operate it on behalf of Telenor for three years. Telenor has agreed to set up a mobile
phone service covering 70% of its largest towns within four years.
Nokia will supply its complete GSM base station subsystem that can be smoothly
upgraded to 3G WCDMA. In addition Nokia will provide turnkey implementation of the
network, including site acquisition, civil works, network planning, implementation and
project management for fast quality ramp-up of the solution.
Nokia will also operate the BSS part of its network. Nokia will establish the network
operations to ensure the timely launch of the quality network.
Communication
Mobile
will
provide
delivery
and
3. Opportunities In Pakistan
Market is greater and the market is on growth stage and at some stages such as
on Eid and other ceremonial days U-fone and Mobilink are not satisfying the
customers requirements.
Threats
As we know that there are already four mobile companies working in Pakistan so this is
a biggest threat for the new company. The information that media and news papers show
us is that when Telenor got the license to invest in Pakistan, the already present
companies had lowered down their rates in the market.
U-fone and Mobilink had almost made the connection charges up to zero and the cost of
the prepaid and postpaid cards is also lower down to a large extend. People belonging to
the lower-middle class as well as lower class people have also taken connections. In a
home every member has a connection and about 75% of the people have mobiles. In
Pakistan this is the biggest threat for the company
Chapter # 6
Problems
The biggest problem is of the four main competitors that are already working in
the mobile industry of Pakistan i.e. Mobilink, Paktel, U-fone and Instaphone.
They all have captured the market and are introducing new features in the
services day by day
The already prevailing mobiles have introduced so much new functions and
lowered down their cost to a large extend so what strategies Telenor will have to
use to become a market leader among these companies
The PTCL has given license to two more international companies to make further
investments in the mobile sector, this will also become a hurdle for Telenor
They have decide to launch connections in Sindh and other lower areas but how
will they attract the customer over their because in those areas the customers are
mostly illiterate and it will be difficult for them to understand this media
language.
Suggestions / Solutions
These were some problems that Telenor can face in future. Although these were very few
but it will take time to be solved. Now we will give the suggestions to solve these
problems and these suggestions are based on the proper analysis to this company as well
as the other companies and the demands and requirements of the customers.
The company should introduce itself with some new package such as free
connections along with mobile for period such as a month
In peak days such as Eid and other ceremonies the mobile services become very
poor and the customer face problems while calling to their relatives and friends.
Telenor should build a strong network, which will provide best quality service
even in these days.
Even though the already serving mobile are providing value added service to
their customers but they should introduce more and latest services for the
customers
The lower rates on calling from one connection to other means if we call from
Telenor to U-fone etc. the lower rate should be offered
They are also giving jobs to the people so they should offer good job package
means which have high chances of progress, training and high salary with
benefits in it
In many areas such as highways and hilly areas like Murree, Swat, Kaghan etc
mobile dont respond and the service become limited so they should capture
those area market instead to entering into the city where already service is
present.
The customer service should be good and all the customers are treated on the
equality bases
In undeveloped areas they should make their helping centers where they should
teach the customers how to operate the mobiles
They should start work in undeveloped areas because it will result in the
increasing of employment in those areas and the people will be motivated
towards study
They should also participate in the donation schemes of Pakistan which work for
the welfare of humanity such as donating to Sukhat Khanam Memorial Trust,
Free medical camps & other schemes which help for the welfare of the society
They should introduce new education relating to satellite study and mobiles etc
which is insufficient and costly in Pakistan
It should work on customer friendly basis and not on money making basis
The group's research and development efforts must create new ways of
simplifying the everyday life of its customers, which benefits society.
It should provide its employees with a safe and positive working environment,
encouraging environmental awareness and promote sound business ethics
throughout the organization.
It is vital that its management and workforce handle ethical dilemmas correctly
Conclusion
The above were some suggestions given which can be helpful for the company to enter
in the new market and progress. In the continued development of its activities, Telenor
should continue to build on the solid, existing platform. The strong Norwegian position
should form the basis for new growth. In immature markets and with respect to new
product ranges, Telenor should look for options to position itself for the future. Growth
will come through a strengthening of its international commitments in growth markets.