Amit Pokhriyal (009)

Ankur Bhargava (014)

Durgesh Dixit (028)
Nishant Karn (043)
Why do consumers need Low Cost Providers?

Poor
Customers

Do they have access to service provided by the formal utility?

Yes No

Is the connection charge affordable?

Yes No

Is the price/quality package attractive?

Yes No

Main Utility
Provider Alternative Providers
Low-cost Service Payment Only
technology flexibility options alternative

Source: Baker & Tremolet (2000)

Grameen Phone- The Emergence
 Launched in 1997.
 It operates in both rural and urban areas of
Bangldesh.
 Grameen Telecom is a subsidiary of Grameen
Phone which with the help of Grameen bank
provides credit system to retail cellular phone
services in rural areas.
 Grameen Phone was created to fund rural
phone programs in Bangladesh with the profits
that it earns.
 GP-GT Interaction
Demonstrates how complementary profit and
non-profit organizations feed into one
another

•GP profits offset GT costs

»-allows GT calls to be 50% off

•Economic growth could lead to an eventual

rise in GP customers
Key Factors for Penetration

 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.
Grameen Phone
Bangladesh
Objective: To reduce poverty by the economic
empowerment of women in rural Bangladesh
Approach: Run a GSM network; lend money to
rural women so that they can purchase mobile
phones; Phone owners rent the phones to the
rest in the community for taking and receiving
phone calls
Beneficiaries: Communities in 50% of the villages in Bangladesh.
140,000 Grameen village phones are already there.
Benefits to community: Means of income for phone owners,
Communication facilities at the doorstep and at affordable rates
Driving Agency: Grameen Group (a Non Profit Org.)
Key to Success in Bangladesh

 High population density

 Very low tele-density
 Topography
 Strength of Grameen Bank
 Discounted airtime rates from Grameen
Phone
 Perseverance
Case 1: The Fish
Business process:

(1) Fish
(2) Go to the nearest market
(3) Sell the fish

Problem: What to fish?

No clue about the market Where to fish?
(demand & offer) Where to sell?
 Problems

Waste of fish (5 to 8%)

Unpredictable income
 Solution:
Fishermen network

Call each other

to determine market demand,
offer and best price
 Results
Result 1:
Fisherman profit growth: 8%

Result 2:
Consumer price decline: 4%

Result 3:
Waste decline: from 8% to 0+%
 Case 2: The Jackfruit
Problem: Consequence:
Less developed areas They often are
have less information (and feel)
on market prices of goods abused
 Solution: CellBazaar

Mobile classified ads

Puts buyers & sellers in contact
IMPACTS / RESULTS
 Saving Time and Money
 Ensuring Safe Transmission of Funds
 Enabling Social Contact
 Empowerment
 Creating new revenue sources

Average income in Bangladesh

= US$300/year

Average income of a Phone Lady

= $730/year

Over 200,000 phone ladies in Bangladesh

Source: Canadian International Development Agency

Value Added Services
 CHALLENGES

 Affordability of rural telecommunication

services.
 Political obstacles and social challenges
faced by the VP operators.
Thank You