FINAL PROJECT OF BP ON PTCL for printing

8/8/2019 FINAL PROJECT OF BP ON PTCL for printing

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Executive Summary

PTCL is an existing business, which has existed for decades. It went through some major

restructuring eras of which 1996 and 2006 are the most prominent. PTCL was incorporated in

1996 and the new management took control of PTCL in 2006 by buying its 26% ordinary shares.

Our main focus in this business plan is the revenue maximization and growth of PTCL not only

in the fields of telephony but also the latest telecom services. PTCL today offers the widest range

of services to its customers. PTCL has laid an Optical Fiber Access Network in the major

metropolitan centers of Pakistan and local loop services have started to be modernized and

upgraded from copper to an optical network.

This report is being started with the brief and complete introduction of organization, its historical

background, its services and its products offerings.

The most important thing the BUSINESS STRAGTEGIES is discussed in such a way that its

not difficult to understand it. Internal and External analysis has the vital importance, which in

this project is also done. Moreover the Financial Analysis is also done which is depicting the

financial position of the organization in the market place. Whereas SWOT analysis is done

which clearly shows what are the strengths, weaknesses, opportunities and threats in the

organization. Finally some suggestions and recommendations are given to organization in thisreport. Thus this report completely depicts the true picture of PTCL in a meaningful way.

1. Company DescriptionPage | 1


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Pakistan Telecommunication Corporation (PTC) has established in December 1990, taking over

operations and functions from Pakistan Telephone and Telegraph Department under Pakistan

Telecommunication Corporation Act 1991.

This coincided with the Government's competitive policy, encouraging private sector participation and resulting in award of licenses for cellular, card-operated payphones, paging

and, lately, data communication services.

In 1994, the PTCL becomes the company limited (Pakistan Telecommunication

Company Limited) by issued six million vouchers exchangeable into 600 million shares of the

PTCL in two separate placements. Each had a par value of Rs. 10 per share. These vouchers

were converted into PTCL shares in mid-1996.

In 1995, Pakistan Telecommunication (Reorganization) Ordinance formed the basis for PTCL

monopoly over basic telecommunication sector in the country. It also paved the way for the

establishment of an independent regulatory regime. The provisions of the Ordinance were lent

permanence in October 1996 through Pakistan Telecommunication (Reorganization) Act.

The year 2006-07 in the telecom sector was marked by the phenomenal growth in the mobile

sector in Pakistan, which doubled its subscriber base to 60 million. The teledensity increased

from 26% to 40%, helping to spread the benefits of communication technology across the

country. PTCLs mobile phone subsidiary Ufones subscriber base grew by more than 87%, from

7.49 million to 14 million. The year also witnessed the entry of major telecom companies, most

notably China Telecom and Singtel, into market.

The privatization of the company was completed in the FY06, following the purchaser of 26%

B class ordinary shares by Etisalat International Pakistan L.L.C. EIP took over management

control on 12 th on April 2006.

In short PTCL has been working vigorously to meet the dual challenge of telecom development

and socio-economic uplift of the country. This is characterized by a clearer appreciation of

ongoing telecom scenario wherein convergence of technologies continuously changes the shape

of the sector.

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A measure of this understanding is progressive measures such as establishment of the company's

mobile and Internet subsidiaries in 1998. As telecommunication monopolies head towards an

imminent end, services and infrastructure providers are set to face even bigger challenges.

Pakistan also entered post-monopoly era with deregulation of the telecom sector in January 2003.

PTCL is in full awareness of the same, and future policies feature a strong conviction of healthy

competition.

1.1 Etisalat and PTCL

In 2006, Pakistan's Privatization Commission held open bidding to sell 1.326 billion shares,

along with management control of PTCL. The Etisalat International Pakistan, a 100 % owned

subsidiary of Emirates Telecommunications Corporation - Etisalat was the highest bidder for a

26 per cent stake in PTCL with a $1.96 (116 rupees) per share offer. Etisalat takes pride in being

a partner in progress wherever it goes. To realize the dream of human progress, Etisalat is ever

ready to harness new technologies, build new partnerships and embrace the future as it comes.

This is the vision that drives Etisalat and directs the Etisalat-PTCL interaction.

Subsequent to the takeover of management control by Etisalat International Pakistan, PTCL

continues its drive to transform into a modern, customer-focused communication and

information provider with a new vigor and commitment. By focusing on customer satisfaction,

partnering with innovation, investing in training and human resources and enhancing its

infrastructure, PTCL is evolving continuously.

PTCL is one of the largest employers in the country with its work force spread all over the

country to provide an essential service to the people of Pakistan. The changed telecom

environment requires PTCL to bring about changes in its corporate culture to thrive more in the

new environment.

1.2 COMPANY PROFILE

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With employee strength of 30,000 and 5.7 million customers, PTCL is the largest

telecommunications provider in Pakistan. PTCL also continues to be the largest CDMA operator

in the country with 0.8 million V-fone customers.

The company maintains a leading position in Pakistan as an infrastructure provider to other telecom operators and corporate customers of the country. It has the potential to be an

instrumental agent in Pakistans economic growth.

PTCL has laid an Optical Fibre Access Network in the major metropolitan centres of Pakistan

and local loop services have started to be modernized and upgraded from copper to an optical

network.

On the Long Distance and International infrastructure side, the capacity of two SEA-ME-WEsubmarine cables are being expanded to meet the increasing demand of International traffic.

1.2.1 Vision

To be the leading Information and Communication Technology Service Provider in the region by

achieving customer satisfaction and maximizing shareholders' value'.

1.2.2 Mission

An organizational environment that fosters professionalism, motivation and quality An environment that is cost effective and quality conscious Services that are based on the most optimum technology "Quality" and "Time" conscious customer service Sustained growth in earnings and profitability

1.2.3 Core Values

Professional Integrity

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Customer Satisfaction Teamwork Company Loyalty

The above mentioned values and statements are just not mere word of mouth by the BOD or thetop management but is having some sound backing the corporate and commercial initiatives.

1.3 Corporate and Commercial Initiatives

As part of the transformation of PTCL, the management initiated work on the re-branding of the

Company as a modern and customer-centric national carrier. Externally changing the logo was

carried out to reflect the commitment to the customers and the modernizing of the infrastructure.

Internally it gave employees a new zeal to stimulate the mindset change from a technology andoperations focused company to a competitive carrier that has customer services as its hallmark.

PTCL made several investments in infrastructure development and added network capacity to

enhance services and expand its reach across the country. The market in Pakistan is extremely

competitive and PTCL has the largest nationwide installed network infrastructure capability

including switching, transmission, fibre optic backbone, co-location and international capacity.

This gives PTCL a unique position in terms of providing to carriers and individual consumers

alike.

With the introduction of Vfone, the new CDMA-based WLL platform of PTCL, is poised to

become the largest fixed wireless telephony network in Pakistan. On the wireless broadband

front, a major upgrade of the WLL CDMA network was rolled out in order to provide wireless

broadband services in 17 major cities.

Broadband Pakistan offers DSL services with unmatched reliability, affordability and

connectivity. Customers have the option to packages with varying speeds from 512Kb to 2Mb

with unlimited downloads. Broadband customer service is available twenty-four hours a day,

seven days a week at 1236 with highly trained and professional representatives.

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As part of offering converged services, expanding its service portfolio and improving customer

retention and acquisition, PTCL initiated the multi-channel Inter Protocol Television (IPTV)

project during 2006-07. This is a landmark addition to the PTCL service portfolio and has

enabled the company to provide Triple Play (voice, video and data) services over a single fixed

line connection. With IPTV the customer are provided with a single interface to satisfy his

communication and entertainment needs along with single billing.

Keeping in mind customer convenience, PTCL is actively engaged in bringing an array of bill

payment options to its customers. PTCL customers now have the flexibility to choose between

dropping a cheque in a drop box at a location near them to sending their payments through mail

at a nearby post office.

PTCL has also offered a dedicated service to provide billing information to its valued subscribers

who can simply dial '1200' to access instant billing information of the required PTCL service.

With the introduction of this service, customers no longer need to personally visit customer

service centers to find out what their bill amounts are and the automated service is available

twenty-four hours a day, seven days a week to further facilitate customers.

Moreover, PTCL has introduced a variety of valued added services for its customers while a

number of others are in the pipeline.

Alongside the many packages and services PTCL is continually seeking ways to facilitate its

customers of which payment cards and electronic modes of payments are just a part.

On the technical front, PTCL has laid an Optical Fibre Access Network in the major

metropolitan centres of Pakistan and local loop services have started to be modernized and

upgraded from copper to an optical network.

PTCL has invested in the capacity of two SEA-ME-WE submarine cables to meet the increasing

demand of international traffic. Additionally, PTCL is also part of a consortium that will put in

place a high-capacity fiber-optic submarine cable that stretches from India to Italy and France via

the Middle East, named I-ME-WE, to provide effective resilience to the existing cable systems

(SMW3 & SMW4).

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PTCL has also signed an agreement with Huawei Technologies Pakistan and Hewlett Packard

(HP) to jointly launch the Network Operation Center project which has state-of-the-art fault

detection and resolution technology. This project would establish one main network operation

center and three regional ones with the implementation of an alarm management system across

the entire PTCL network in an integrated manner.

Beyond improved packages and new products, PTCL, as a socially responsible corporate entity,

has been pursuing different social causes touching on areas of culture, sports, music,

environment and general welfare by supporting different initiatives.

As such, PTCLs CSR activities and new ventures are warmly welcomed

1.4 PTCL Subsidiaries

1.4.1 Ufone

Ufone (Pakistan Telecom Mobile Ltd) a wholly-owned subsidiary of PTCL commenced its

operations on 29th January 2001 as a GSM 900 service provider. Since the outset, it has

expanded its coverage and customer base at a rapid pace and established itself as one of the

leading cellular service providers in Pakistan. Ufone is now considered to be one of the most

active, aggressive and innovative players in the mobile sector of Pakistan.

The growth of the cellular industry is a direct result of the successful implementation of the

telecom deregulation and cellular mobile policy by the Ministry of IT and Telecommunications

(MOIT&T) and the support, guidance and timely enforcement of regulatory process by the

Pakistan Telecommunication Authority (PTA).

1.4.2 Maskatiya Communications

PTCL acquired Maskatiya Communications (Pvt) Limited (MAXCOM). MAXCOM is an

internet service provider operating in Karachi and some parts of Hyderabad. Its customer base is

around 6,000 subscribers. The 100% shareholding of MAXCOM has been transferred in PTCLsPage | 7


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name. MAXCOM customers are now eligible to enjoy superior PTCL broadband and other

products and services.

2. Product and services

For clear communication the first choice of business circles is PTCL telephone for local,

nationwide and international calling. Today businesses can have 10-100 lines with modern day

services to meet their needs. Now you get options like Caller-ID, call-forwarding, call-waiting,

Call Barring, to name a few.

Other business specific services include:

0800-Toll free number, 0900-Preminum rate services, VPN-Virtual Private Network, Audio

Conference Service, Digital Cross Connect (DXX), ISDN (Policy), Teleplus(ISDN/BRI), Digital

Phone Facilities/ Modification Charges, UAN, UIN.

White Label Services:

PTCL can now provide uninterrupted services to their clients without undertaking large scale

investment in infrastructure or developing expertise in their own network.

PTCL White Label Services are focused on speed and simplicity at minimal cost. This will

enable customers to offer their own branded WLL, DSL etc to customers nationally, together with an array of key support services.

2.1 EVO Wireless Broadband

PTCL EVO 3G Wireless Broadband is Pakistans fastest wireless internet which offers its

customers superior 3G internet experience. Evo Wireless Broadband is enabling the wireless

broadband revolution in Pakistan with flexibility to roam freely like never before. PTCL Evo has

revolutionized the way people connect to the internet by offering true mobility. PTCL Evo is

currently offering its services in more than 18 cities on EV-DO technology offering speeds up to

3.1 Mbps. PTCL Evo gives its customers the advantage of nationwide roaming with seamless

internet connectivity across Pakistan. The coverage of Evo is not limited to 18 cities as Evo

customers can enjoy CDMA-1X data rates of up to 153.6 Kbps at more than 1000 destinations

across Pakistan.

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The portable, small & stylish Evo USB device is a multipurpose device which not only delivers

fastest wireless internet but can also be used for Voice Calls by inserting a Vfone SIM and for

data storage by inserting a standard Micro SD Card

2.2 Broadband Pakistan

PTCL Broadband is the largest and the fastest growing Broadband service in Pakistan. Since its

launch on 19th May 2007, PTCL has acquired approximately 432,821 Broadband customers in

over 150 cities and towns across Pakistan, leading the proliferation and awareness of Broadband

services across Pakistan.

With its entry in this market segment, PTCL opened up a broadband culture in Pakistan, where

till a couple of years back there was very little awareness in the country about broadband & high

speed internet services. PTCL made the broadband technology affordable by lowering the

barriers to entry, by geographically bringing the service within the reach of a common user

across Pakistan and by continuous improvements in customer care for the service.

Unique offers that make PTCLs Broadband unmatchable are special packages for the student

segment, one time Installation charges of Rs. 500. The installation charges are applicable from

July 1,2010, Availability of Wi-Fi Modems, FREE dial up service for its Broadband customers

and FREE access to movies, music, classical Pakistani dramas, cricket matches, online gaming,

educational and religious content on PTCLs entertainment portal BUZZ, (the access to PTCL

Buzz & Gaming lounge is exclusive to PTCL Broadband subscribers). PTCL also offers multiple

FREE personalized e-mail accounts exclusively to its broadband users. In addition, PTCL

recently doubled its broadband speed for all its existing and new customers at the same price,

making 1 MB as its minimum offered speed.

2.3 IPTV Service (Smart TV)

Using its state of the art Broadband network, PTCL entered the media sector on 14th August

2008, by launching a digital interactive television service for the first time in Pakistan.

Employing the IPTV (Internet Protocol TV) technology, PTCL brought Pakistan in the list of a

few countries across the globe that offers this state of the art interactive TV service to its

subscribers.

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Branded under PTCL Smart Line, the service includes Interactive Television, Broadband and

voice telephony all at the same time on PTCLs telephone line. Besides offering the highest

digital quality TV picture, the most revolutionary section of this offering is the ability to rewind

and pause live TV channels through TSTV (Time Shift Television) feature, the ability to

block / unblock any TV channel for parental lock and the ability to search through video on

demand content. Currently PTCL Smart TV offers its viewers 125 live channels and over 500

Movie titles through its Video on Demand service. The service is available in 16 cities including

Karachi - Lahore - Islamabad - Rawalpindi - Gujranwala - Faisalabad - Peshawar - Sialkot -

Multan - Sargodha - Jehlum - Wah Cantt - Taxila - Hyderabad - Abbotaba and Sukkur however

it is planned to be expanded to all the major cities and towns across Pakistan during the year

2010

2.4 V-fone

PTCL also continues to be the largest CDMA operator in the country with approximately 1.25

million V-fone customers. It offers fixed wireless telephone for your homes & business. With

CDMA2000 1X technology, ours is the largest WLL network with a capacity of 2.6M, covering

over 10,000 urban & rural areas. The network is already enabled for Voice, Dialup-Internet

access (153.6kbps) and EVDO Broadband. V-fone can be bought from franchises or by dialing

1236 and it will be delivered within 48-72 hours.

2.5 PTCL Web Hosting Services

In today's world, a website is an important tool for any business. PTCL now offers world class

hosting on windows platform. PTCL provides you the control, flexibility and reliability required

to create and manage a successful web presence and our self healing backbone make sure the

high availability of your website.

Their web-based Control Panel helps you manage and advertise your site. The Control panel provides you with powerful and easy to use tools to help you manage and control your site.

2.5.1 Features

Fully Redundant Infrastructure

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Multiple data base support

24x7 available support

Additional storage space and tape backup/restoration options

Guaranteed privacy of customer data

Customer-managed email accounts

High availability

A highly secure environment

99.999% uptime

2.6 Security& Surveillance

SENTRY Ready 2 Go

SENTRY Personalized

SENTRY Customized

2.6.1 SENTRY Customized

When developing IP Video Surveillance solutions, PTCL focuses on the solution requirements of

the specific site and customer needs. In order to provide the most effective and functional IP

video surveillance system, PTCL first spends considerable effort understanding the customers

needs, expectations, and budget. Any existing video surveillance hardware and network

infrastructure are included in the design, if possible. Understanding these requirements is what

allows PTCL to develop and implement the most reliable, manageable, and most of all, effective

IP video surveillance solutions available today.

2.7 PTCL Telepresence Service

PTCL Tele Presence is an innovative new technology that combines rich audio with high-

definition video to deliver a true in-person experience. It is designed to bring you and your

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team closer to the people, places, and events you need to build your business. The creation of a

live, face-to-face meeting experience empowers users to interact and collaborate like never

before.

2.8 PTCL Data Centers

The rise of Internet, Intranet and Web-based technologies has made the data center more

strategic than ever, improving productivity, enhancing business processes, and accelerating

change. Data centers are the strategic focus of IT efforts to protect optimize and grow the

business. PTCL Data Center offers strategies that enable your business to respond to industry

trends and prepare for the future which reduces the total cost of ownership by introducing a new

and innovative architecture.

PTCL Tier 3+ Data Centers helps you to virtualize system, storage, and network resources to

reduce the number of systems you need to manage, while increasing asset utilization. Their Data

Center solution allows businesses to protect critical applications and confidential data, enhance

data center operational efficiencies, and rapidly create new secure application environments to

support new business processes.

PTCL Data Centers is an ideal choice for companies who want the flexibility to relocate their

data center capacity as their business demands.

2.9 Skylink

PTCL introduces Skylink satellite communication service for operators and corporate

customers. PTCL, the largest, integrated telecommunications service provider in Pakistan is

pleased to announce the introduction of SKYLINK satellite communication services for

corporate customers and telecom operators for domestic and international communication

applications. PTCL is the most experienced operator in the satellite communication domain and

has extensive ground support, operations and implementation infrastructure to service a variety

of satellite communication applications such as :

Leased line services for domestic & international connectivity

Cellular backhaul

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Enterprise applications including remote site connectivity

Other satellite connectivity solutions tailored for telecom carriers and corporate

customers

SkyLink services are based on advanced satellite technology providing dedicated point-to-point

and point-to-multipoint connectivity between sites within the coverage footprint. SkyLink offers

high-quality 64Kbps up to n x Mbps links between locations. Key features of PTCL SkyLink

service are:

Reach SkyLink is available everywhere in the country due to strong footprint of our

satellites of choice.

On Ground Presence and Experience PTCLs field operations, network monitoring,and management systems are present on ground, in close proximity to the remote locations.

Rapid Deployment SkyLink can be deployed quickly on geographically dispersed

sites. Uniform Quality of Service All sites within PTCL SkyLink network provide the

same consistent quality of service, regardless of their geographical location.

Cost Effective Highly competitive rates. Flexibility- The size of SkyLink network can

be readily expanded depending on business operation needs, with end-to-end control from a

central hub.

2.10 International IP Services

IP services for voice and data form an integral component of PTCLs service portfolio for

carriers and service providers throughout the country. With capacity acquired on SMW-3 and

SMW-4 submarine cables and strategic partnership with FLAG, PTCL is the largest IP services

carrier in Pakistan with extensive international peering capacity. PTCL has made significant

network investments to achieve top-class network reliability, availability and performance to

help keep carrier networks running smoothly. PTCL is connected to the global IP backbone

through tier-1 carriers who are able to provide an extensive IP backbone infrastructure ideally

suited to deliver reliability, performance and security for carrier grade applications. In addition to

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Internet applications, PTCL provides secure and reliable VoIP solutions catering to the

requirements of LDI and other operators in the marketplace.

3. Market Analysis

PTCL is providing its services to its customers in every nook and corner of Pakistan. A complete

market analysis of PTCL will help the company to determine its current position in the market

and how it can improve it in future.

Market analysis requires following information to be collected:

1. Market size

2. Target customers

3. Total customers

4. Target market

5. Market trends

6. Future anticipation

7. Growth potential

8. Market profitability

9. Distribution patterns

3.1 Market Size

In Pakistan, there is an opportunity for PTCL to expand its business because market size is very

big and there is unmet demand. PTCL is currently providing its products to the customers

locating mostly to urban setup of Pakistan. As number of internet users is increasing day by day;Page | 14


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PTCL has an opportunity to meet needs of these internet users and increase its market share.

Currently it has 6.5 million customers.

3.2 Target Customers

PTCL is currently focusing on meeting internet usage requirements of consumers; but it is also

providing internet solutions and value added services to small, medium and corporate businesses

also. Targeted customers of PTCL include the following:

House Hold

Education (Universities, Schools, education institutes)

Banking & Finance (banks, post offices, insurance companies)

Retail (Stores, Gas stations, Supermarkets)

Transportation (Airports, Railways, Harbors)

Government (authorities, police, military, health care

Requirements: Reliability, Speed, Excellent customer service.

3.3 Total Customers

In a very long period of time (six decades); PTCL has captured almost every customer. Target

for next year is to create 0.2 Million customers across the country for the services it has

introduced. The company has resources and capacity to expand its operations across Pakistan and

meet demands of more customers . Currently it has 5.7 million customers excluding 0.8 million

v-fone and its subsidiaries.

3.4 Target Markets

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PTCL is currently targeting only developed markets where there is large number of customers.

PTCL has launched its outlets in Islamabad, Karachi, Lahore and Rawalpindi and planning to

target customers in small cities and towns in near future.

3.5 Market TrendsThe wireless internet trends in Pakistan have a great impact on everything from the humble PC,

internet and broadband (fixed) to the local and foreign supply chain. Wireless internet (EVO 3G

technology) is one of the major steps towards the fast provision of wireless internet services in

Pakistan. As PTCL is using 3G technology, it has gained attention of a large number of

customers as now customers demand quality and speed.

3.6 Future Anticipation

In future PTCL is ready to target it planned customers and markets in Pakistan. After householdconsumers, the company will go for corporate clients, Government and Universities and schools.

3.7 Growth Potential

The company is operating only in major cities (as far as services are concerned) of Pakistan and

targeting only developed areas. There is unmet demand in the market which is a great

opportunity for PTCL to increase its number of customers thus getting a large share in the

market.

3.8 Market Profitability

The company is currently operating in all four provinces of Pakistan but still it is not earning

good profits. PTCL is becoming first choice of internet users because of its technology and

customer services.

3.9 Distribution Pattern

To provide reliable services and product and after sale services; PTCL has opted for own outletdistribution channel, where customer friendly customer relation officers are ready to deal with

their customers. PTCL is working through direct sales channels because the company doesnt

want to compromise on quality and want to provide maximum comfort to its customers. By

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establishing own sales outlets; PTCL is focusing on providing customers with excellent

customers support.

3.10. Competitors Products Analysis

PTCL enjoy such a strategic position that none of its competitor offers such a variety of services

and products. For instance consider the following matrix which is only for internet services.

Name Starting Date Spectrum Cities Services Future Plans

Wateen Dec,2007 58,600 3.5 GHz 22

Wireless Broadband /VOIP / FTTH / WhiteLabeled Services/ DataWarehousing

MVNO / Improving andexpanding the network / DigitalTV / Cable & DSL Broadband /Entertainment Portal

Mobilink Infinity

Oct, 2008 13,400 3.5 GHz 1Wireless Broadband /VOIP

Linkdotnet is going to merge intoMobilink Infinity / launch in 8 to10 cities

PTCLBroadbandPakistan

May,2007 139,5001,900 MHz

(EVDO)108

Broadband (DSL) /IPTV / DPLC, IPLC, IPTransi t Services /Entertainment Portal

Wireless broadband. Remotesurveillance / communityservices like Tele-Presence /video conferencing, DigitalDirectories

WorldCall June,2005 46,9001,900 MHz

(EVDO)3

Wireless Broadband(EVDO)in Karachi only

/ Cable TV

Expansion of wireless broadbandin other cities / start FTTC (triple

play) in Islamabad

LinkdotNet 2005 26,000**** 5 DSL BroadbandGoing to merge into Mobilink Infinity

Telecard /Augere

Expected 09 - 3.5 GHz 1 Calling Card

Augere Pakistan has beenrefrained by the internationalcourt located in Singapore fromstarting WIMAX operations inPakistan

CyberNet March,1997 10900*** 7 DSL Broadband Deploy fiber in Islamabad

Multinet 2005 1,800 activeusers

10 DSL Broadband Nationwide long haul optical fiber of 4,100 km / pre-802.16deployment in Karachi

Micronet July,2002 17900** 2DSL Broadband / MultiPlayer Gaming / VideoConferencing

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Nayatel 2004 3000** 1

Broadband Internet /Digital cable / FixedLine telephony services/ Video conferencing

Acquisition of second STM-1

4. Business Environment

The industry analysis is based on afore mentioned internet competitors. Internet ServiceProviders in Pakistan are offering wide range of Broadband technologies, such as DSL, Cable,FTTH and WIMAX. Currently, DSL is the leading broadband technology in Pakistan withapprox 65 percent market share. Major DSL providers in Pakistan are Micronet, LinkdotNet,Cybernet, Multinet and PTCL.When compared with cellular phone growth, broadband has beenslow to take off in Pakistan. The last two years show some progress in terms of growth, morechoices of services in more places and most importantly a significant drop in cost for broadbandaccess (~Rs.800-1200 per month on average). Another emerging trend is to move towardsunlimited broadband.

With PTCLs wired and network capacity of about 5.5 million subscribers, it is foreseen thatDSL may not cater the future broadband requirements of the country. This leaves a hugeinvestment potential in Fiber and wireless broadband access technologies.

Use of FTTH and WIMAX has increased, not with the same ratio as in developed countries, butemergence and benefits of services is pulling customers towards FTTH. There are around 2800FTTH and 20,000 WIMAX subscribers in Pakistan. Wateen Telecom, Mobilink Infinity andPTCL are WIMAX providers in the country. However, due to first of its kind experience of WIMAX technology, service issues are being reported.

Following is the chart showing technological trends in Pakistan and market captured by eachtechnology.

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FIgure: 4.1

A large market is captured by DSL technology, whereas WiMAX has a very little share because

it is on introductory stage

4.1 Porters Model

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Figure: 4.2

The following analysis of each external force defined by Porter will help us determine the level

at which these forces are operating.

4.1.1 Threat of New Entrants

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TheIndustry

Rivalryamong

existing firms

Substitutes

(Threat of substitute

products/services

Potentialentrants

(Threat of new

entrants)

Suppliers(Bargaining

power of suppliers

Buyers

(Bargainingpower of buyers)


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There is an unmet demand in the market for wireless internet services. Therefore there is an

opportunity for new companies to start their operations and provide such services in Pakistani

market. Qubee An Augere Brand, have now been officially launched in Karachi and

Islamabad. Qubee has become the fourth player offering WIMAX services, the other three being

Wateen, Mobilink Infinity and Wi-tribe. The services also are expected to be launched in Lahore,

Hyderabad and Quetta in 2010.

4.1.2 Bargaining Power of Buyers

There are an extremely large number of buyers as compared to companies in the industry. DSL

and other fixed internet service provider have captured at least 70% market share. And buyers

are satisfied with customers. So PTCL is positioning through quality and price. So the bargaining power of buyer is high in internet industry.

4.1.3 Threat of Substitutes

PTCL landline services have a threat from cell phone operators and their broadband services

have threat from Wi-Max technology. Otherwise there is no such company that can match the

portfolio of ptcl.

4.1.4 Bargaining Power of Suppliers

WIMAX technology is newly introduced in wireless internet world. In all over the world the

demand of this technology is high so WIMAX is charging high prices for its services on the basis

of their demand, brand name, reliability and innovation. So is the bargaining power of suppliers

is also very less as compared to PTCL.

4.1.5 Rivalry among Existing Firms

PTCL has taken the lead with its DSL and EVO offerings while World Call, Mobilink Infinity,Wateen / WIMAX, Qubee, NayaTel and Wi-Tribe. At least 65% share of DSL and WIMAX has

only 8% share in market. A heavy war is going on the bases of price in this industry. PTCL has

almost no threat as it is offering its services at a very low price which is compelling its rivals to

offer their services at a competitive price.

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Key Success Factors in the Industry:

Following are some of the factors participating for getting success in the industry.

Wide geographic presence is a critical factor in case of the kind of wireless broadband

and related services.

Quality of service which includes reliability, speed, coverage etc. is very important to the

customer.

It is very important to stay ahead of competition in this kind of industry which is driven

by technology. So, the company cannot be complacent and would have to focus on

constant innovation.

Internal capabilities including the experienced and trained personnel would be a key

success factor in this kind of business.

Knowledge about the culture and habits of the customers is very important. The company

would have to remain in touch with the changing needs of the customers.

SWOT Matrix:

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Figure 5.1

5. SWOT ANALYSIS

5.1 Strengths

Largest operational network and infrastructure within ICT (Information &

Communication Technologies) segment.Page | 23

Weaknesses:

Mature marketBad perception of PTCLLack of skilledworkforce

Opportunities:

Large population toserveOperate indeveloping market

Unmet demand

S-O Strategies:

Expand operations todeveloping areas also

Thrive on quality toattract more

customers

W-O Strategies:

The market has reachedits maturityProvide best services togain confidence of customers

Training of staff tosupport customers

Threats:

Launch of othercompaniesRapid technologicalchangesDownturn ineconomy

S-T Strategies:

No compromise onquality to competeStrong R&D tosupport innovation

W-T Strategies:

Aggressive advertisingto spread brand nameDevelop goodperception aboutproduct

Strengths:

Reliability

QualityExcellent customersupport


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An integrated Monopoly

Market leadership in Local loop, Wireless local loop (WLL) and fixed telephony.

PTCL (Ufone) is market challenger in GSM segment

Ufone is performing well though Warid and Telenor are tough competitors. Ufones

profitability increased by 49.2 percent to Rs.977 million in 3H/ FY09 as compared to Rs.

655 million in the corresponding period last.

Competitors still depend on PTCL network either directly or indirectly

Experienced Telecom Resources

5.2 Weakness

Not been able to nurture its growth around customer services oriented strategy

Internal organizational and business processes issues

Monopolistic culture has further added to its complexities

PTCL-V, the fixed wireless phone service is poor

Over employment & low productivity.

Slow decision making including external interferences.

Corporate culture akin to government departments.

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6. BUSSINESS STRATEGY

As PTCL growing its position as the leading ICT service provider and a profit leader, a five year

Strategic Master Plan for the Company, with defined corporate KPI targets, timelines and

ownerships was developed by the PTCL management. Defining yearly targets on market sharesfor various voice and data services, introduction of a corporate KPI based performance

measurement system, Restructuring of the organization, formulation of IPTV, Triple Play and

converged services, migration to an end to end IP based network, Investment strategies such as

Assets Management for risk diversification and improved Return on Investments, were all part of

the master plan.

6.1 DIFFERENTIATION

PTCL has by far the largest network coverage, competitive price, and a range of Value Added

services including Phone book, messaging, and call logs. PTCL wireless service gives voice

quality of a landline with country-wide coverage, employing the state of the art CDMA 2001x

technology and nationwide availability.

6.2 COST LEADERSHIP

Since PTCL is the oldest communication service provider in Pakistan. It has already an

advantage of developed infrastructure, huge market, stakeholders in government and MNCs. Sowe can easily go for cost leadership strategy without losing its customer focus.

6.3 FOCUS STRATEGY

6.3.1 Fiber Optics and Corporate Services

PTCL seriously needs to focus on its customers because it already has a huge market. So well be

following customer focus strategy in order to better market our product and services and also to

retain our customers.

It so happened in the recent past that our corporate clients had a problem of connectivity while

using data center service. Some of them were so angry that they switched to other carriers. Ptcl

is working on fiber optics network expansion, so that optical cables are carried all the way to end

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user. Right now fiber optics only covers a radius of five hundred meters and rest is covered by

copper cables.

6.4 Rationale

The rationale behind adopting above such strategies is that PTCL today has the largest market

pre-occupied just because of its presence in Pakistan over last 40odd decades. PTCL had been

through a lot of ups and downs but today it offers services more than any other service provider

in Pakistan. So at this point in time it is safe to say that the service innovation along with better

customer service will continue and the PTCLs monopoly will continue to prevail in telephony

and internet.

These strategies are adopted also because of the weaknesses mentioned above. So we want to

overcome our weaknesses and gain competitive advantage by providing such services that are

either not available or are very costly.

7. Financial Plan

The financial plan of the company is such designed that the company will grow twelve percent in

terms of profitability in the following five years after 2010. Though the company recorded a loss

recently in FY 10-11(1 st quarter) which is not a loss in reality because it is due to the capital

expenditure made by the company which will give higher returns in the future. The twelve

percent increase taken in the financial plan is not a round figure but is averaged. The profit is

likely to increase and decrease in the random pattern. It is assumed that the most profit shall be

reaped by the company in the end of 2012 and starting of 2013 which can go up to twenty three

percent.

The financial plan is made under the following assumptions

7.1 Assumptions

a) The trend towards the better technology will not change

b) PTCL will continue to innovate and provide better and better customer service

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c) PTCL will not lose its current customers, instead will also capture the corporate

customers

d) The prevailing conditions will not affect the companys profit and performance

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FINAL PROJECT OF BP ON PTCL for printing

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