Viking's Success Story
Ola Ree took over as the managing director of Grameen Phone
(GP) in 2000, the growth of the country's cell phone industry,
had "just started". In real terms this translated
to a modest subscriber-base of 100,000. Within four and a
half years of Ree's stint GP has been able to boast over two
million customers. The company's network, which before Ree's
arrival only covered a handful of cities, has now been widened
to 61 districts and 350 Upazilas. Ree, the Norwegian engineer
who has just ended his tenure in Bangladesh, gives a glimpse
into the strategies he and his dedicated team adopted to create
this unprecedented success.
ingredient to GP's remarkable growth, Ree believes, is its
wide coverage. From day one, he says, "we have been trying
to cover as many districts as possible". "We reached
out to the rural areas; started to cover all the cities and
as many districts as possible. That was the strategy,"
Ree explains. "If we construct a base-station in an extremely
remote area the capacity of that station is almost filled
up the next day," he says, "people, seeing us constructing
a tower, go to the market, buy a phone and check everyday
if the connection has come."
since its inception in March 26, 1997, in contrast to most
cellular phone service providers, who kept their service limited
only to major city dwellers, Grameen opted for building continuous
strategic decision that has put GP at the top is its pre-paid
service. When the company first introduced the service to
the local market in 2005, experts were sceptical about Easy
Pre-paid Service's success. At that time, many had considered
it a huge gamble as the concept of paying bills by using a
pre-paid card had failed to generate much enthusiasm in the
Indian, and most notably, in the Nepalese market. However,
Ree says, "For us it was not a gamble at all. We, Telenor,
have launched pre-paid service in all the fourteen countries
we operate. From a developing country like Ukraine to a developed
country like Norway, pre-paid remains a big success.
time pre-paid was a big thing in Bangladesh you know…Instead
of applying for a BTTB line, waiting in queue for years you
just walk into a shop, buy a mobile and within minutes, you
can call any phone in the country."
despite its huge success Grameen Phone is not immune to criticism.
Among them, the most scathing is the allegation of high tariff.
Though many believe that Bangladesh has the highest tariff
in the world, Ree thinks, "it is very much at par with
Asia except for some special packages that some Indian operators
have been offering". "Our list of costs is always
compared with Reliance India's 60-paisa package," he
continues. "But if I were an Indian buyer I would never
buy that package. First, it's 60-paisa for a Reliance India
subscriber to place a call and the person at the other end
has to be within a 50 kilometres range of the caller. If the
person you are calling is outside this range the rate is far
higher," he says.
are hidden costs to consider as well says Ree. In addition
to the start-up costs, Reliance India subscribers have to
pay additional 20,000 rupees to avail this facility. "Our
cheapest tariff is Taka two during night-time for GP post-paid
subscribers. But if you say that the per minute tariff of
any cell phone in Bangladesh is Tk 2 that will be wrong,"
from its special night-time tariff-rate for the prepaid subscribers,
the company has also launched a unique service called My Time.
Under this facility, the subscribers can pick two three-hour
time-slots and can call to another GP subscriber at a cheaper
biggest impediment, GP's outgoing MD believes, is the government's
lukewarm attitude towards private cellular phone service providers.
"If we had normal interconnection facility with the BTTB
and if we were given permission to provide land-phone connections,
prices would have certainly gone down from day one,"
you know, if any GP subscriber calls a BTTB number, we have
to pay BTTB the full price for that call. If I call my friends
in Norway from my cell, Grameen Phone has to pay the full
price to the BTTB for using its facility. But if somebody
calls me on my phone from Norway or any other country, through
BTTB's network, I get nothing. BTTB takes it all," he
is the only country I know, which has such an inter-connection
problem that is hindering the growth in this thriving sector
is the country's taxation policy. Unlike most of its neighbours,
Bangladesh has one of the highest import duties on telecom
equipment. "We have to pay a very high duty on the telecom
equipment we import for our base stations. It varies from
16 to 60 percent, whereas most of our neighbours, on the other
hand, maintain a zero-tax on its telecom sector," he
all the obstacles, GP, which is 55% owned by Telenor, has
remained an example of corporate success. On the eve of its
take off, the company has decided to go slow and to concentrate
more on widening its network coverage. "We are going
to invest more this year. And by the end of 2005 we will surely
cover the whole country," Ree promises.
fact, has decided not to jump on the much-hyped 3G bandwagon;
instead, the next big thing the company is going to introduce
is 2.5 Generation mobile phones. "It is the technical
phrase for GPRS, which is basically a type of high-speed data
communications service," Ree, who has been working with
Telenor for 27 years, explains.
system will transmit data at 160 Kilo Bytes Per Seconds (KBPS),
which is around 16 times faster than the usual than the current
data transmission rate. "It will enable our subscribers
to send photos instantly," Ree says. "We have already
launched this service in Malaysia," he continues, "and
most of our network in Bangladesh is technically prepared
experts, however, believe the company is going to face stiff
competition from Egyptian telecom giant Orascom Telecom which
has bought 100 percent of the country's beleaguered cellular
phone operator Sheba Telecom. But, Ree believes, competition
will help all the operators to improve their service as he
thinks every company's priority should be to satisfy it's
customers. "If we compete on a level playing field we
should not fear competition," Ola Ree says matter-of-factly.
always kept a low profile despite being a major change maker
in Grameen Phone's portfolio but he is quite frank about his
affinity for this country. "We (my wife and I) were very
sceptical about moving into Bangladesh as all we had heard
about the country was ferry capsize and flooding. After coming
here and seeing we have a very different impression."
Ree says what really impressed him about Bangladesh was the
positive attitude of people and their innate friendliness.
only regret is that I have to leave Bangladesh" says
Ree before flying off to his new job in Singapore.
Mehreen Amin and Ahmede Hussain
(R) thedailystar.net 2004