easypaisa

1-Review of the cellular sector in Pakistan using the Porter's five forces

PORTER FIVE FORCES:

Threat of New Entry:

As government of Pakistan is showing liberalism in case of telecommunication sector

and opened its policies to award new licensees to new mobile service providers so
threat of new entry is high. The foreign leaders such as Vodafone and tango can enter
into Pakistan.
As capital intensive industry so require set-up cost is in billions of dollars so in this case
threat of new entry is low, but there are companies who are working to achieve licenses
and approaching PTA to know terms and conditions for this.
There is a perfect competition in the industry, so there is a little chance for new entrants.
The setup cost is quite high and distribution network building is not easy.
Bargaining Power of Buyers:

Power of buyer is high in telecommunication sector. There are five market players that
are Mobilink, Ufone, Telenor, Warid and Zong and these players are offering different
packages at different prices and a situation of price war is running. Buyers have a power
to buy any package which is suited to them. They can change the network easily
because cost of switching is low.
Cost of switching from one company package to other company packages low. The
churn rate is quite alarming for the mobile network such as Mobilink. Hence, power of
buyers is high.
Bargaining Power of Suppliers:

The power of suppliers is low in case of telecommunication sector.

Suppliers have to provide Quality oriented services, in which they have to provide
services at competitive and low price in order to retain their customers, so they have low
bargaining power.
Moreover, their profit margins are becoming tighter because of price competition and
variety of services and packages offered by other market players.
Even though numbers of suppliers are few in the market but they are competing in the
market to get more market share.
Threat of Substitute Products:

Government also gave so many land lines and wireless local loop licenses to different
companies like PTCL wireless local loop, GO CDMA that is technology used by global
wireless service provider better than GSM in terms of capacity and voice quality etc.

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these services in future will be like mobile phone services like they are planning to offer
services a lot but currently they are offering SMS and CLI services to their customers.
The government has issued the 3G and 4G network for telecomm sector. The company
which possesses 3G and 4G has the maximum share of urban customers.
The SMS and call packages of each cellular company are threat to another company
SMS and call packages. Every company tries hard to provide the VAS and other facilities
equally. Every day there is a new SMS, call package and new VAS by cellular
companies.
Rivalry among Competing Firms in Industry:

There is strong rivalry among competitors. The price war is going at high pace benefiting
the consumers. There is high pressure on service provider to provide low prices to
consumers.
Thuraya satellite service is offering subscribers freedom of mobility and uninterrupted
service. Thuraya's satellite technology supplements of existing mobile service providers,
overcoming the challenges of large geographical areas and insurmountable terrain
The rivalry among telecomm industry is not hidden. The companies are seen pulling legs
of others in their commercial. There is comparative marketing going on in the industry.

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Porter Five Forces Model

Launch of EasyPaisa: a critical outlook covering key milestones, what went right?
what went wrong? what were the challenges?
JOURNEY OF EASY PAISA:
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Telenor was the first cellular company which introduced the easyload service in
telecomm industry. The process of this easy load was to submit money to shopkeeper
along with the number of the receiver. This instantly top up the mobile account of the
receiver.
After the successful working of Telenor easy load, it thought of extending its financial
services. Telenor started searching out for banks for this project. On the other hand,
Tameer microfinance bank was also looking for its penetration into the market with an
alternative source. It dealt in small loans, bill payments and etc. tameer microfinance
presented its proposal to mobilink and ufone but no motivating response was generated
by them. The Telenor looked into this opportunity in a way that it will offer four services
i.e. utility bills, domestic remittances, international remittance, e-wallet and checking.
There was large potential target market for each of the sector. The Telenor CEO was
also looking at the performance of M-PESA in Kenya. It was launched by the subsidiary
of vodaphone i.e. safaricom.
Telenor group had past experience of financial services such as Grameen phone in
Bangladesh, DTAC in Thailand. The both companies analyzed the potential growth of
this segment and started to work on it. The first hurdle was the restriction implied by the
government.
In 2008, the SBP converted the branchless banking restrictions to the regulation. One of
them i.e. Telenor and TMF tried to acquire the license for branchless banking. Now the
question rose how to make this plan happens. After all the considerations and review of
money models, it was declared that they could not establish a network without the retail
agent.
By spring 2009, the brand name easy paisa was finalized for the financial services of
Telenor.
The easy paisa focused on the four products
Bill payment
Money transfers
Mobile account
International remittance
To help with this network, Telenor first contacts its existing retail agents. They were
excited about the new services and welcomed tis initiative.
Tameer was responsible auditing retailers and hosting core banking system. The
marketing, retail setup, channel management, technology, call center services, customer
and complaint handling was the responsibility of Telenor. The IT infrastructure of this
concept was developed a year ago before its launch.
Then there was an issue of maintaining the security of these payments. This was done
by through the NIC of the receiver and a code.
Easy paisa was unique concept they should have asked for a patent to maintain their
competitive advantage. Moreover, they should not use the concept over the phone
because retail agents are not trained enough to carry out this sort of task.
What are key developments in Mobile banking after the timeline of this case? This
has to cover recent times.

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Easy Pay Solution for Companies:

Easy pay is a revolutionary Online Payment Solution that enables internet merchants
and webshops to collect payments from any person in Pakistan. It brings the benefits of
secure, centralized and hassle-free payments to merchants and consumers alike. Easy
pay offers multiple ways of collecting payments from your customers. Payment options
include via debit card, credit card, mobile account or easypaisa shops.

Easypaisa ATM Card:

Easypaisa now offers ATM cards that are available for all Mobile Account customers.
These ATM cards will work on every ATM in the country and can be used to withdraw
cash from the Mobile Account directly. These ATM cards are highly secure and also
extremely convenient for Mobile Account customers who dont need to go to an
easypaisa shop to withdraw cash every time.

Easypaisa-e-Payments:
Easypaisa has introduced e-Payments, the 1st NFC Payments Services in Pakistan. Pay
instantly and securely at your favorite retail outlet. Simply tap your e-Payments NFC tag
with the retailers NFC device to pay its that quick! No Cash. No Card! All you need is
your mobile phone.

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Khushaal Beema:
Easypaisa now brings Khushaal Bema; a savings product offering, through which our
Mobile Account Customers upon savings Rs. 2,000 or more in their Mobile Accounts can
get Life and Accidental Death Insurance of up to Rs. 1 Million absolutely free. Not just
this, with Khushaal Bema, the more saving in Mobile Account, the higher will be
insurance coverage.

Easypaisa Ticketing Solution:

Easypaisa joins hands with PIA to introduce its ticketing product that makes the entire
traveling process extremely convenient and instant.

Khushaal Munafa:
Easypaisa Now offers Easypaisa Khushaal Munafa, through which customers can earn
returns of up to 9% upon saving in their Mobile Accounts. So now no reason to save at

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home or through informal means such as committees customers can save in Easypaisa
Khushaal Munafa today and their savings grow for tomorrows expenditures.

Money Transfer to Others Banks from Easypaisa Shop:

The Easypaisa Money Transfer to Bank Account allow customers to send
money to their friends, family and business partners directly into their Bank
Account from any easypaisa shop in the most efficient, secure and
convenient way. This service doesnt necessarily need a Telenor connection or
a mobile phone. Any person in Pakistan can use this service without any
registration.

Easypaisa Sehat Sahara:

Easypaisa now brings Easypaisa Sehat Sahara a health insurance product in
collaboration with Microensure and Jubilee insurance. Through Easypaisa Sehat Sahara
Easypaisa customers can get coverage of Rs.1,000 per day by paying a premium
amount of Rs.750 for a year.

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References
http://science.blurtit.com/111140/what-are-porters-five-forces-for-pakistanitelecommunication-industry
https://www.scribd.com/.../Competition-in-Telecom-Industry-of-Pakistan

www.slideshare.net/irfanaleem/easy-paisa-33867831
www.easypaisa.com.pk/

www.tameerbank.com/easypaisa.html
cellphone-companies.com/.../telenor-easy-paisa-procedure-charges-fees-
propakistani.pk/.../bank-accounts-go-mobile-with-telenor-easy-paisa-first

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