Ptcl Final Project

Privatization of PTCL

Research report

“Privatization of PTCL”

Business Research Methods

Submitted toMs. Asma Asrar

Group membersFaiza Shah

Anaum ZahidRabia Malik

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http://en.wikipedia.org/wiki/Image:PTCLnewLogo.jpg


BBA-ITM(9)

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Acknowledgement

All praise to Allah, who gave us strength and abilities to complete this project. We are

especially thankful to Mr. Gul Ahmed (executive vise president regulatory affairs) and

Mr. Ansar Mahmood Bhatti (senior manager external communication) who provided

valuable help and guidance in every stage of the project.

We would like to thank Ms. Asma Asrar my program coordinator for her guidance in

completion of project.

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Table of Contents Sr. No Page

No

1.

2.

3.

4.

5.

Abstract

Chapter 1 Introduction

Privatization Privatization Need Process of Privatization Privatization in Pakistan

Historical Background of PTCL Introduction of PTCL Introduction of Etisalat

Chapter 2 Literature Review

Literature Review

Chapter 3 Research Methodology

Problem Area Problem Statement Theoretical Framework

Dependent Variable Independent Variables Moderating Variable

Schematic diagram for theoretical framework

Hypothesis Data Collection

Chapter 4 Privatization of PTCL

Privatization of PTCL Need of Privatization in current Scenario Objectives of Privatization Bidders of PTCL Criticism on Privatization of PTCL The Struggle against Privatization of Pakistan

telecoms PTCL after Privatization

Financial Performance Commercial Initiatives Customer Satisfaction

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7789101111

14

1717171717182021

2222

242425252627

28282930

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6.

Human Resource Development ERP Re-launch of V Wireless as Vfone Launch of Broadband in Pakistan Contact Centers

o Telephone to Television Looking Ahead – from

Telephone to Television Carrier Services and Wholesale Corporate and regulatory Affairs Infrastructure and Service Enhancement Corporate Social Responsibility

Subsidiaries Pak Telecom Mobile Limited(PTML) Paknet Limited

Carrier telephone Industries (Ptv) Ltd.(CTI)

Analysts are Optimistic Challenges ahead for PTCL

Chapter 5 Data Analysis

Interview Questionnaire Sample Questionnaire Conclusion & Recommendation Reference References

30303131313132323233333434343535

3536

383941555758

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Abstract

Pakistan Telecommunication Company Limited is the largest telecommunication

provider in Pakistan. On 18th June 2005 a major event took place which was the

privatization of PTCL. It was a decision made by the government without the conformity

of the company’s employee who strongly disagreed with the decision and had protested

and strikes were observed within the country to make the government change its decision.

The motto of the employees was that such a precious and sensitive national asset should

not be handed over to private parties, particularly the foreigners. Whereas the government

believed that the revenues of the company were declining due to increased competition,

therefore privatization of PTCL would be a very good option and due to this the company

might earn large amount of revenues and thus wanted to improve the efficiency and

quality of services.

In this research project the main objective is to know the factors which lead to the

privatization of PTCL and the changes & improvements which took place after the

privatization. Another aim is to find out whether the decision of privatization was a good

idea or not.

Surveys, Internet, Annual report of PTCL, Articles, Questionnaires and Interviews have

been conducted in order to gather the required information.

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Chapter 1

Introduction

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Privatization

“The transfer of property or responsibility from the public sector to the private

sector partial or complete is privatization”

The philosophy of privatization stems from the role of state in economic Life. The

thinking of the international financial institutions and free market economists is that, as in

USA, the state should confine itself to regulation only and the operation and ownership of

industrial enterprises and utilities should be left to the private sector.

Privatization need:

Pakistan along with other developing countries followed the activist role for the state in

industrialization and the rate of industrial growth in Pakistan has been very high.

The first main thrust for privatization is the belief that private sector units are more

efficient than public sector units. This is not true across the board. In a study which made

a comparison between public industrial enterprises and private firms producing similar

goods, the conclusion was that changing the ownership of industry from public to private

is neither a necessary nor a sufficient condition for more efficient operation of specific

industrial enterprises. However, on the other hand it is often correctly claimed due to

political interference and over-staffing; the efficiency of the public sector units is

reduced.

The second argument for privatization is its fiscal impact. The favorable fiscal impact of

privatization is expected from the sale proceeds being used to retire national debt, as well

as elimination of losses of the public sector units as the losses were being finance from

the budget. The opposite view is that the public enterprises after nationalization in 1973

doubled the payment of their taxes as compared to the pre-nationalization period.

Moreover, if the public sector enterprises are making profit and giving the government

return higher than the rate at which it is borrowing from the market, the privatization of

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profitable enterprises would have an adverse impact on the budget.

Hence this argument does not hold for profitable public sector enterprises.

The third argument for privatization is to foster competition and to strengthen capital

markets. If all the units in certain sectors like cement are owned by the state and these are

sold to different parties, there would be healthy competition. Capital market is

strengthened, if the government share holdings are sold in the market as was done in case

of PTCL and more recently in the case of Muslim Commercial Bank and Al-Falah Bank.

Capital market is not strengthening at all, if one public sector unit is handed over to the

private party without some of its shares being offered to the public. Hence it is necessary

for strengthening and deepening of capital market that some percentage of the shares of

public is sold to the public through Stock Exchange.

Another objective of privatization is to encourage direct foreign investment. The direct

foreign investment in profitable public units is not likely to be beneficial for the

economy, as against the benefit of an initial purchase price; one has to calculate the

recurring remittance of profit in foreign exchange for years and decades to come. Direct

foreign investment therefore should be attracted by policy and design into new and risky

ventures rather that through the purchases of profitable enterprises.

Process of privatization

Privatization is a complex exercise with multifaceted implications and has to be

concluded with a number of caveats.

The first is that it should be absolutely transparent process with full legal safeguards and

watertight procedures, otherwise the valuable public assets may be sold at throw away

prices and causing a huge loss to the national assets. It has also been observed that

privatization should avoid crony capitalism; it has been associated with giving away

expensive public assets at cheap rates to political cronies. Privatization gives tremendous

patronage to the government in power, which may be exercised to favor vested political

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interests rather than to serve long run national objective, negating the

basic objective of improving efficiency in the economy.

The second imperative of privatization is sequencing and timing. It is essential that all the

assets should not be sold in a short period, because in the short period the buying power

of private sector may not be adequate to offer the correct prices for all the privatized

assets. It may crowd out fresh foreign investment and lead to reduction in the rate of

investment in the economy.

The third essential condition for the success of privatization is that economy should be

deregulated and unnecessary restrictions and procedures for industrial enterprises should

be done away with. Privatization should therefore be part of a process to strengthen

private sector by giving it assets as well as improving regulatory framework for their

operation. To give units to the private sector but to keep it throttled by massive

regulations would not improve the operational efficiency. Hence the sale of privatized

units should be staggered over time.

Finally it must be ensured that the party which is buying the industrial units does not use

it for stripping the assets and selling the real state because if the party does this, there will

be a serous loss of out put, employment and taxes to the national economy.

Privatization in Pakistan

There have been two tides of privatization in Pakistan. The first tide is from 1992 to 1994

and the second tide from July 2001 to October 15, 2002. In the first period assets worth

Rs.120 billion were divested and in the second period assets worth Rs.65 billion were

divested. Only 22% of the privatized units were performing well than in the pre-

privatization period, 44% approximately the same and about the third i.e. 34% worse than

before. It is quite clear that the compelling reason for privatization that of improving the

efficiency of the units, was only attained by about 1/5 of the units, whereas the rest were

working with the same efficiency or worse than before. On the whole, operational

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efficiency deteriorated after privatization. Moreover, the most tragic

consequence of privatization was the closure of many units, which are listed below;

1. Zeal Pak Cement

2. National Cement

3. Pak PVC

4. Pak China Fertilizer

5. Karachi Pipe Mills

6. Metropolitan Steel

7. Quality Steel

8. Indus Steel Pipe

The closure of these units has played havoc to the national economy and the first phase of

privatization has contributed to the lower rate of industrial and economic growth. The

GDP growth which was above 6% in the 1980’s declined to around 4% in the post

privatization period.i

Historical background of PTCL

1947 Posts & Telegraph Dept. established

1962 Pakistan Telegraph & Telephone Deptt.

1990-91 Pakistan Telecom Corporation

1995 About 5 % of PTC assets transferred to PTA, FAB & NTC.

1996 PTCL Formed listed on all Stock Exchanges of Pakistan

1998 Mobile(Ufone)& Internet(PakNet)subsidiaries established

2000 Telecom Policy Finalized

2003 Telecom Deregulation Policy Announced

2005-20062006 Etisalat Takes Over PTCL ii

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Introduction of PTCL

With employee strength of 65,000 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 Pakistan’s economic growth. 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 PTCL is

the incumbent service provider for provision of fixed line telecommunications.

Established as public limited company in 1996, PTCL is 74% owned by the Government

of Pakistan. PTCL launched its mobile and data services subsideries in 1998 by the name

of Ufone and PakNet respectively. None of the brands made it to the top slots in the

respective competitions. Lately, however, Ufone had increased its market share in the

cellular sector. The PakNet brand has effectively dissolved over the period of time.

Recent DSL services launched by PTCL reflect this by the introduction of a new brand

name and operations of the service being directly supervised by PTCL instead of

Paknet.iii

Introduction of Etisalat

Etisalat has been the telecommunications service provider in the United Arab Emirates

since 1976 and is the number one mobile operator in the UAE. For three decades, since

the birth of the UAE, it has played a key role in driving and supporting the nation’s

prosperity. Famous for over 30 years for delivering technological excellence, innovation

and reliability, Etisalat is on track to be a top 20 Global Telco by 2010 - pioneering

technology for tomorrow’s customers.

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Etisalat, which has 33 million subscribers in 14 countries, has made acquisitions and

investments in excess of Dh30 billion in expanding international operations. The UAE-

based operator operates in Afghanistan, Benin, Burkina Faso, the Central African

Republic, Ivory Coast, Egypt, Gabon, Niger, Saudi Arabia, Sudan, Tanzania, Togo,

Pakistan, and the U.A.E.

Etisalat stands 140th among the Financial Times Top 500 Corporations in the world in

terms of market capitalization, and is ranked by The Middle East magazine as the 6th

largest company in the Middle East in terms of capitalization and revenues. The

Corporation is the largest contributor outside the oil sector to development programmes

of the UAE Federal Government. Etisalat has also won accolades from across the region

for its nationalization programmeiv

.

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Chapter no. 2

Literature review

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Literature review

The privatization of PTCL which took place on 18 June 2005 was a historical event both

for Pakistan and the United Arab Emirates (UAE) as the consortium led by Etisalat, a

major regional telecom player and in which the Government of United Arab Emirates is

the majority shareholder, emerged as the highest bidder at US$1.96 per share equivalent

to Rs. 117.01 per share.v

Obaid Saeed Bin Mes'har, chief executive of Etisalat, told reporters in Dubai the

investment would pay off within five years, hopefully sooner. His bid was about 40

percent above the average PTCL share price for the past six months.

"We feel this is the right value," he said, adding Chief Executive of Etisalat International

Obaid Saeed has said that no PTCL employee will be relieved, the expertise, technical

experiences and skills of PTCL employees would be utilized properly. The new

management will take steps for improving quality, reorganization and extension of PTCL

service to more areas, he remarked. Trained engineering and technical staff might be sent

to Africa and other countries after imparting additional training to them.vi

After privatization PTCL reported a 24.7 percent fall in net profit for 2006-07 financial

years, as rising competition led to a decline in revenues from call traffic.vii

Giving reasons for privatization, the minister of privatization Dr Hafeez Shiekh said this

was being done to attract new management, capital and technology in a bid to further

improve efficiency and quality of services. This process would also help in retiring

national debt besides expediting work on poverty alleviation programme.viii

PTCL union leader announced a countrywide strike. They don’t want further dialogue

with corrupt and liar government functionaries.” they said PTCL workers would jam the

telecommunication services throughout the country on June 15 two days before

privatization if the government did not withdraw its decision to privatize the company.ix

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During the privatization of PTCL many employees were against privatization. This was a

main issue in most of the news papers. Workers at Pakistan Telecommunication

Company Limited (PTCL)—who have been occupying the company’s Islamabad

headquarters and other facilities since May 25—are threatening to sever the country’s

communications network, unless Pervez Musharraf’s military government abandons its

plans to privatize what is Pakistan’s largest and most profitable public-sector enterprise.

The MN Muhammad Pervaiz Malik gives his opinion that the sale of Pakistan

Telecommunication Company Limited to foreign investors is illogical. Malik said that

energy, banking and communication were vital national assets He said that privatization

of the organizations nationalized in 1972 was justified as they were running in deficit, but

the sale of the profitable PTCL was unjustifiable. He said that if privatization of these

institutions was essential then their shares should be sold through the Stock Exchange

and the workers should be given a golden handshake.x

A large number of people took out a rally to protest against the privatization of the PTCL

and demanded that the precious and sensitive national asset should not be handed over to

private parties, particularly the foreigners. On the occasion, a statement of the PTCL

employees CBA Union spokesperson was read out which said that the workers had

rejected the privatization package being offered by the government. It claimed that under

the said package status of over 16,000 NPS employees would be changed and they would

immediately become temporary. It said that none of the nine unions, which had formed

the Unions Action Committee, had accepted the package.xi

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Chapter no 3Research methodology

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Problem area

Our problem area is “privatization”, the trend which is increasing day by day in most

dominant companies like PTCL, HBL etc. We want to know the reasons due to which the

companies decided to privatize and to sell its shares. We also want to know Is decision of

privatization good for most of the companies? Is there any improvement after

privatization?

Problem statement

Our problem statement is

“Circumstances and effects of privatization of PTCL”

In our research project we basically want to know the factors which lead to privatization

of PTCL and the changes & improvement after the privatization of PTCL. We want to

know is the decision of privatization is really good idea or not.

Theoretical framework

1. Dependent variable


There are different variables due to which privatization of PTCL occurred. Privatization

of PTCL is dependent variable which is dependent upon different variables. These

variables are effecting privatization directly or indirectly.

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2. Independent variables

Deregulation of telecom sector

Due to deregulation the competition among the service provider increases which then

leads to less amount of profits. Deregulation is the removal of Government controls

from an industry or sector, to allow for a free and efficient marketplace. “Since the

implementation of deregulation policies in the domestic telecom sector, the company is

facing immense competition from new players, especially in the long-distance and

international calls segment.”

This deregulation is bringing about loss of market share, reduction of tariffs and lower

profit margins and development of new telephone services and uses.

Company’s access to capital

The revenues of the company are declining due to increasing competition. Government of

Pakistan thinks that privatization of PTCL is a very good option and the company will

earn large amount of revenues after privatization. Services innovation should be

enhanced in the basic and value added services for generating quicker revenues. Further,

the orders in which structural adjustments take place determine their effectiveness.

International lending organizations

International lending organizations began pressuring countries to divest.

Substantial evidence reveals that privatization can lead to performance improvements.

Dr. Abdul Hafeez Sheikh (Federal Minister for Privatization and Investment) said that the

process of the privatization not only helped in lending more depth to country's stock

market but also ensured the share of common man in the ownership of state-owned

enterprise.

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Top management support

Privatization of PTCL has a strong support of top management. The decision of

privatization is also dependent upon top management. Most of the managers think that

with the privatization of PTCL the profits and the efficiency of the employees can

increase but the lower level employees do not agree with this.

Price Discrimination

In order to retain and even expand the market share, PTCL can resort to price

discrimination. This can be between users of own network and other operators networks.

For example PTCL may fix different rates for intra-network calls and inter-network calls.

Lower rates of intra-network calls will be strong temptation for customers to remain

stuck of PTCL instead of switching over to other choice operators. This can be done by

more revenues which could be possible after privatization.

Advancement in wireless technology

PTCL has tons of copper buried under the ground which can be exploited for broadband

services based on IP technologies. The average distance between the exchange and the

subscriber in the case of Pakistan is too high. This is so because the network was planned

for voice-only operations that work on the old technology. However, as residential and

commercial broadband access solutions gain popularity, these copper pairs will be used

for xDSL services as well. A prime requirement for running most of the DSL service is

that the cable length from the exchange to the subscriber should be limited to less than

three cable-route kilometers. A few services that can offer multi-megabit access rate

require an exchange-to-subscriber cable distance of less than a kilometer. Currently,

PTCL has O&M Contracts with four private sector operators namely Habib Rafiq

International, Micronet Broadband, Multinet Broadband and Sysnet Pakistan to deploy

countrywide DSL networks. The new management of PTCL may make the situation

better by redesigning their whole network.

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In the developing countries, investment in Telecom infrastructure is

considered a necessary foundation for economic growth. Massive investment is required

to combat low Tele-density, poor service quality, to introduce modern technologies and

to face the advances in wireless technologies. Such investments are far beyond the reach

of many governments that other social and development programs requiring urgent

funding.

Moderating variable

Poor performance

The exceptionally poor performance of state-owned telecom firms generated pressure for

reforms. Long waiting periods for telephone connections and the unreliability of those

connections generated popular demand, while inefficient operations often requiring large

subsidies encouraged governments to divest firms that were draining national treasuries.

Bottom line of all privatization decisions, stated objectives notwithstanding, remains to

address the needs of telecom modernization, attract private sector investment, reduce

government involvement to ensure fair competition (to promote greater rivalry among

firms, leading to improved productivity, wider consumer choice and lower prices) and

growth of the sector.

Schematic diagram for theoretical framework

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Advances in wireless technology

Deregulation of telecom sector

Reduction of tariffs & lower profit margin

Loss of market share

Development of new telephone services

Top management support

Price discrimination

Poor services

Dependent Variable

Moderating Variable

International lending organization

Company’s access to capital

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Independent variables



Hypothesis

Based on problem statement and theoretical framework we have formulated following

hypothesis.

1. “Privatization of PTCL occurred due to deregulation of telecom sector”.

2. “Efficiency and productivity of the employees increases with the

privatization of PTCL.”

3. “Infrastructure of PTCL has improved after privatization.”

4. “Services offered to its customers increases with the privatization of PTCL.”

5. “Technological advancements occur after privatization of PTCL.”

6. “Net profits of the company increases after the privatization of PTCL.”

Data collection

After identifying the steps the big task is data collection and for collecting the

information required, I use the following resources

Surveys

Internet

Annual report of PTCL

Articles

Questionnaires

Interviews

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Chapter no. 4


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PTCL is a revenue spinner and the only company with ground lines in each nook and

corner of the country. PTCL has privatized by the government twice. Firstly in 1994 12%

shares are issued to general public and then in 2005 26% of PTCL has privatized, but this

time these shares are not offered to the general public. This time foreign companies are

invited for the bid, and government also had a plan to hand over the management for the

improvement of PTCL. Among these 26% shares 10% are offered to PTCL workers at

discount rate.xii

Need of Privatization in Current Scenario:

Pakistan followed a gradual approach to liberalize its telecom market. During 1990s, as a

first step, market was opened for value added services and competition was introduced in

cellular mobile sector as four licenses were issued (Mobilink, PTML, PakTel and

Instaphone). The government monopoly was retained in fixed line services, however,

PTCL legal monopoly ended w.e.f 31 December 2002. The government announced

Telecom Deregulation Policy and Cellular Mobile Policy in 2003 and 2004 respectively.

In the year 2002 PTCL has enlisted for privatization. Pakistan seems to have followed a

safe approach i.e. liberalization followed by privatization.xiii As PTCL was a Government

owned organization it had a monopoly in landline services but it is not generating so

much revenue. In 58 years PTCL should able to create 4.8 Million customers. In 1990

new licenses was issued to two cellular companies, which open a new scenario of

competition in telecom sector. With in 15 years these cellular companies have increased a

half a dozen. In 2002 PTA decides to give local loop licenses to private companies, this

opened the new challenge for PTCL. PTA had also reduced the taxes for cellular

subscribers. Till July 2005 the total number of cellular subscribers was 12 million. Due to

the increase in customers of cellular companies the growth of PTCL decreased. In this

competitive era PTCL was unable to survive because the growth of PTCL has affected by

other companies. New companies in Local Loop sector are also

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Introducing, they will also affect the revenue of PTCL. So privatization became

necessary for PTCL. xiv

Objectives of privatization

Privatization will improve the infrastructure of PTCL.

The revenue generated by PTCL will be used to pay off depts. xv

The new company will also increase the network of PTCL.

Raising investment capital for the industry and the company being privatized

Reducing government role in the society

Increasing efficiency

In this competitive era the major reason on privatization of PTCL is to survive in

competitive environment.

Introducing greater competitionxvi

Bidders of PTCL

PTCL’s privatization was scheduled for June 10, but was postponed because of the

workers’ weeklong strike. After the announcement of PTA many companies are

interested to take part in the privatization of PTCL. Privatization commission of Pakistan

had short-listed several foreign telecom conglomerates as potential buyers. Besides the

three companies, (China Tel, Sing Tel and Etisalat) to put down cash, Telecom Malaysia,

MTC of Kuwait, Saudi Oger, Turkcell, and Saudi Telecommunications Company were

also in the running. Three bidders took part in the privatization of PTCL. These bidders

had already deposited $40 million each as earnest money to become eligible. They were

asked to submit sealed bids one by one and were opened by reporters. The rest of the five

bidders pre-qualified by the privatization commission did not take part in the bidding.

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China Mobile of China offered a bid price of $1.06(Rs.63.48) per share or $1.409 Billion

(Rs.84 billion) for 26% shares, which was about 84% lower than the highest bid. It

estimated total value of the company at Rs.33.74 billion.

Another bidder of the company was Sing Tel of Singapore, offered a bid price of $0.88

(Rs52.54) per share or $1.16688 billion (Rs69.663 billion) for 2% shares. This bid was

about 80% lower than the highest bid. Sing Tel valued the whole company at Rs267.9

billion.

Etisalat a company of UAE offered the highest bid of $2.59596 billion to acquire 26%

shares of PTCL. It offered $1.96 (Rs117.01) per share. Etisalat valued the whole

company at Rs596.76 billion.

Etisalat has to deposit 25% of the bid money within 14 days of the issuance of letter of

acceptance by the privatization commission of Pakistan. The remaining 75% amount

would have to be deposit in 60 days period, after which the management would stand,

transferred to Etisalat.xvii

Criticism on privatization of PTCL

Most of the people think that PTCL is again a revenue spinner and the only company

with ground lines in each nook and corner of the country. Handing over this profitable

strategic asset to a foreign company will be devastating for Pakistan’s economy and

security.xviii

People have the opinion that Privatization in Pakistan has not met its objectives. At

present it is in national interest to remove PSO, OGDC, PTCL, HBL and NBP from the

list of privatization, as their privatization would be strategically dangerous and

economically unjustifiable. If we go along with the announced pace of privatization our

economy, which already in recession will suffer and we will lose our economic

sovereignty. Moreover, IMF’s next demand will be to privatize Mangla and Tarbela

27



dams, which would bring an utter ruin to the economy.

xix

The struggle against privatization of Pakistan Telecoms

During the period of privatization for over 6 weeks, 65 000 telecommunication

workers were involved in a bitter struggle against the Pakistan Telecommunications

Company Ltd (PTCL) and the government in an attempt to defeat the part-privatization

of the company.

This was a fight which gripped the imagination of hundreds of thousands of the

Pakistani working class and trade union activists as well as socialists the world over.

The willingness of the workers to struggle, alongside the best left trade union leaders

and activists, under very difficult conditions, was key in forcing the management to make

concessions during the dispute. As well as this the flood of international solidarity and

protests initiated by the Committee for a Workers International, and taken up by other

working class activists, played an important role in pressurizing the Musharraf regime

and giving support to the telecommunication workers.

With the stepping up of neo-liberal exploitation of the neo-colonial world, and in

particular, the drive to privatize what remains of state owned services and industry, these

types of struggle assume even more importance in the workers’ movement internationally

than before. This is especially the case, given the fact that there is an increasing global

opposition to privatization and the effects of capitalist globalization.xx

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PTCL after Privatization

Many big change events are happening in PTCL at the moment after its privatization.

The biggest challenge for PTCL is to transform itself from being a very large company

that has been traditionally internally focused to one that is customer focused and market

led, with the speed to complete with smaller agile new entrants. We have taken on the

challenge and the transformation has already started.

Financial Performance:

1. The Company posted a net profit of Rs.15.64 billion (EPS Rs.3.07) against last year’s

figure of Rs.20.78 billion. The declining trend in profitability continued during the

financial year ended June 30, 2007 due to structural adjustments brought about in the

telecom sector by competition.

Figure 1.Net Profits

2. Although PTCL maintained its leading market share in the fixed line, there was a

decrease in revenues by 5.5% mainly due to substitution impact of mobile expansion.

During the period under review, PTCL earned a total revenue of Rs 14.4 billion in

2007 compared.

29



Figure 2.Revenue

3. There was also an increase in operating expanses by 11.7% mainly due to prudent

provisions for doubtful debts and long term systematic improvements in operations

and customer services. Operating expenses were Rs 10.7 billion against Rs 10.1

billion of previous years, showing an increase of 6%.xxi

4. Non-operating income of Rs 1,127 million was 14 % higher than the last year’s figure

of Rs 992 million. Profit before tax was Rs 4.6 billion as compared to Rs 7.7 billion

for the same period last year and the net profit after tax for the quarter remained Rs

3.0 billion.

The management is adopting new strategies to improve revenues. The decision to extend

ISD facility to all the customers had a salutary impact on international traffic. Both the

incoming and outgoing traffic showed healthy growth of 27% and 148%, respectively, as

compared to the same period last year.xxii

Commercial Initiatives:

As part of highlighting that change, the management initiated work on re-branding the

Company as a modern and ‘customer centric’ national carrier. Externally, changing of the

logo was carried out to reflect the commitment to customers that will come through

modernizing of the infrastructure and the state of the art customer services. Internally, it

was to present employees with a new zeal & determination that stimulates a mindset

30



change from technology and operations focused company to a

competitive carrier that has customer services as its hallmark. PTCL choose August 14 th,

the Independence Day, to launch its new logo and theme of ‘feel the difference’.

Figure 3.New Logo

Customer satisfaction

In, addition, PTCL is focusing on improving customer satisfaction levels to bring in line

with the best-in-breed class. Significant investment is also being made in infrastructure

improvements, introduction of new operational support systems including billing and

customer care, and business process improvements Started during 2006-07, this is

expected to go a long way in addressing the modern day customers’ needs and offering

more flexible and customer friendly service packages.xxiii

Human resource development

To right size the human resource of PTCL, in accordance with the international telecom

standards and to bring the company’s headcount in line with other telecom operators

worldwide, management is working towards the finalization of a scheme named as

voluntary separation scheme (VSS).A consultant will be appointed soon to advice on the

implementation of VSS. The company is initiating employee retention programs to

complement the VSS and is planning a series of diverse training workshops as well.xxiv

ERP

Initiation of re-engineering and automating the existing internal processes within the

Company started. This was done by bringing in the automated ERP (Enterprise Resource

Planning) tool, ensuring that the processes within the Company are all made fast and

efficient so as to cater for all the internal and external customers’ modern needs.xxv

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Re-launch of V Wireless as Vfone:

Vfone brand is poised to become the largest fixed wireless telephony network of

Pakistan. PTCL has expanded the network to provide coverage in all large and small

cities including over 10,000 villages in rural areas of Pakistan. As Vfone becomes the

Wireless substitute to landline in un-served areas, it will be a robust line for voice, data

and fax services for use at home and in the office.

Launch of Broadband Pakistan:

From the end customer’s perspective, a major initiative was

put in place in the shape of ‘Broadband Pakistan’ service launch as a first step towards

providing its customer with more value added service and convenience. With this

offering, PTCL will not only be bringing the benefit of high speed Internet access to

subscribers in major cities but will also generate new revenue streams for future

growth.xxvi

PTCL achieved unprecedented success as it added over

10,000 customers within the first 120 days of its launch

while historically it had taken four years collectively for all

the other operators to achieve 30,000 customers in

Pakistan! The hallmark of PTCL service was the removal

of the traditional barriers such as the upfront costs of

installation and customer premises equipment and added

bandwidth download.xxvii

Contact Centers

The arrival of Dot.Com in Pakistan

During the year your Company introduced state of the art contact centers at Karachi and

Lahore to provide 24x7x365 customer service to Landline, Broadband and Vfone

customers nationwide. The contact center is powered by fully automated IT based Billing

& Customer Care applications that provide online information to agents to serve the

customers interactively.xxviii

32



Looking Ahead – from

Telephone to Television:

PTCL initiated the multi channel Inter Protocol Television (IPTV) project during 2006-

07. Inclusion of IPTV service, to be launched during the coming year, will be a hallmark

to the PTCL services portfolio and enable PTCL to provide Triple Play (voice, video &

data) services over a single connection. The penetration of TV sets in Pakistan is more

than fixed line telephone and therefore successful offering of IPTV will provide PTCL

with an effective tool for new customer acquisition, The customer will be provided with

the single interface to satisfy its Communication/entertainment needs along with ‘one

stop shop’ billing.

Figure 4.IPTVxxix

Carrier Services and Wholesale

With the de-regulation of telecommunication sector, many new operators were awarded

licenses to offer telecommunication services. These operators are also dependent on

PTCL for certain critical infrastructure such as leased lines, interconnection links, co-

location facilities essentially requiring PTCL to act as the “Carriers’ carrier” in the

telecommunication marketplace.

While PTCL has been a provider of Carrier services since new operators were introduced

in the marketplace, it is only a recent initiative that the long term importance of “Carrier’s

business” to PTCL has been recognized and a unit has been created to exclusively focus

on operators’ business within PTCL and address their service needs in a timely,

33



prioritized manner from a single window. The business unit, being

staffed with professional account managers focused on relationship building with carrier

customers, will work closely with such carrier customers for ensuring timely delivery of

infrastructure and services. xxx

Corporate and regulatory affairs

The regulatory environment through out the year remained very intense following the

many policy initiatives of the Pakistan telecom authority. The company continues to

evaluate all such changes in the regulatory framework to ensure a level playing field and

also challenged some of the directors issued by the PTA during the year. The company

has strengthened its regulatory department to better manage regulatory affairs, licence

obligations and interconnection functions.xxxi

Infrastructure & Service Enhancement:

Also, 330 new towns were brought on the Optical Fiber Network expanding the facility

to 1030 cites country wide. Transmission network has been augmented with the addition

of one wavelength in the exiting 2.5 GB DWDM Rings along-with the addition of four

new 10 GB DWDM Rings to meet ever increasing long-haul transmission requirements.

Optical Fiber Access Network (OFAN-II), has been provided in 13 major cities;

Islamabad/Rawalpindi, Peshawar, Sialkot, Gujranwala, Lahore, Faislabad, Sargodha,

Sheikhupura, Multan, Hyderabad, Karachi, Quetta and Hub. High capacity 2.5 GB &

10GB Metro Rings were also provided in this project to support the high bandwidth

requirement for the upcoming new and value added services. Also, 310,830 pairs,

saleable capacity on Optical Fiber Access Network have been made available during the

year using state of the art technology.

The Etisalat Quality department of UAE also assisted PTCL during the year. Part of this

assistance was the assignment of a three year Work Plan to QA department of PTCL

which includes SOP roll-out, Quality Assessment Checklists, Quality Awareness

34



campaign through trainings and publications, implementation of ISO

9001 certification.xxxii

PTCL has global connectivity via Satellite, SMW3 and SMW4 submarine optical fiber

cable systems.

Corporate Social Responsibility:

As a socially responsible corporate entity, PTCL has been pursuing different social

causes to continue to society. They have been touching upon the areas of culture, sports,

music, environment and general welfare by supporting different initiatives and activities.

In wake of the heavy destruction caused by 8th October’s deadly earthquake PTCL

sponsored a 48-bed Eye Hospital of LRBT at Mansehra, set up free help lines and also

facilitated the collection of relief goods.

Subsidiaries:

1. Pak Telecom Mobile Limited (PTML)

Pursuant to privatization of PTCL in April 2006, the board of directors of Ufone was also

reconstituted. xxxiiiUfone, one of the largest cellular service providers, initiated country’s

largest ever expansion project amounting to US$ 525 MILLION. Now, under the

management of Etisalat, Ufone will concentrate on customer needs and benefits and is

more determined than ever to be the leading cellular player in the market.With the Phase

V expansion project underway, the network expansion will cover over 2,000 cities,

towns, villages and all major highways in the country. The subscriber base was 14

million at June 30, 2007, which represents 87% increase over the same period last year.

During the year ended June 30, 2007, Ufone managed to improve its operational and

financial figures and it reported strong revenue and operating profit growth of 43% and

36% respectively over the previous year.xxxiv

2. Paknet limited

35

http://images.google.com.pk/imgres?imgurl=http://www.apnahyderabad.com/IMAGES/paknetlogo.gif&imgrefurl=http://www.apnahyderabad.com/hyderabad/internet-access-provider.asp&h=88&w=199&sz=5&hl=en&start=6&um=1&tbnid=U_8bt1VJ27zHvM:&tbnh=46&tbnw=104&prev=



The board of directors of Pakistan has been reconstituted. Paknet has the largest internet

infrastructure in the country .With Pops in 44 locations and internet access availability in

over 2000 cities and towns. Although having the largest infrastructure, Paknet was unable

to fully leverage its competitive advantage and has incurred losses.

Carrier telephone industries (Pvt) Ltd. (CTI)

The company was privatized in November 2005 as part of the PTCL privatization

commitment. PTCL’s equity investment of Rs 8million was sold for the Rs 500 million to

siemens AG. The company had earned a current year profit of Rs 2 million before

privatization in November 2005.

The Board was informed that last year the telecom sector experienced dynamic change,

landmark developments and innovation resulting in a highly challenging and fast growing

telecom market. The expansion in telephone infrastructure and the growth in teledensity

during the year have been phenomenal. As a result the competition among the operators

was also unprecedented. In this highly competitive environment, PTCL was able to

maintain its leading position in the market and achieve a healthy profitability.xxxv

Analysts Are Optimistic

As reported by Reuters, Analysts said the fall in profits was a result of lower revenue

from international and domestic call traffic and increased competition from new market

players. But analysts said PTCL’s profitability is expected to rise in coming years as it

expands network and attracts more customers.

“We anticipate an 11 percent annual growth in net profit of the company during the

next three years,” said Abrar Hussain, an analyst at First Capital Equities. PTCL’s

profitability growth is to result from the cumulative impact of expanded fixed line

network, including profit of 20.78 billion rupees last year.

36



“The company has potential to grow in the longer run if the

management succeeds in implementing steps for network expansion, service

customization, cost-cutting and the introduction of new services and efficiency

measures,” said Hifza Zia, an analyst at Atlas Capital Market.xxxvi

Challenges ahead for PTCL

PTCL is also likely to face tough competition in IPLC, DPLC and interconnect business

from Transworld a Mobilink GSM partner company. And within the country competition

from Wateen Telecom while network interconnect competition from Multinet broad

Band. The three LDI’s are getting one of the important movers and shakers of the

telecom market of Pakistan.

Mean while tough regulatory moves for PTCL are also giving it hard knocks to launch

some of its new products like “PTCL Life Style” which already hangs in balance.

And internal privatization is also on the cards because the company can not survive with

more then 60,000 employees on board.xxxvii

37



Chapter no 5Data analysis

38



Interview

We conducted an interview from Mr. Ansar Mahmood Bhatti (senior manager. external

communication) for getting help about our topic and understanding it in a better way.

Mr Ansar Mahmood also writes articles in newspaper and deals with external affairs. He

told us that the main reason of the privatization of PTCL is increasing competition in the

telecom sector. Government of Pakistan thought that income and the efficiency will

increase after privatization of PTCL government has the agenda to fetch more foreign

investment. In the next six months there are chances that 51% of the shares will be sold to

Etisalat and then the management will be handed to them completely. Etisalat bought

management because they that PTCL has more potential and can earn more profits

through services. Financial condition at that time was good .due to deregulation

competition increases and this is the main reason of less profits. But it is expected that

PTCL will start recovering in some years after which their profits will rise.

About the criticism of employees on privatization of PTCL he said that only unions

opposed it because they think after privatization it will go in foreign hand. They will be

arrested that’s why they were against of it and started many strikes.

After privatization there is uncertainty among employees and the efficiency decreases

with it because they do not feel their jobs secured. To right size the human resource of

PTCL, in accordance with the international telecom standards and to bring the company’s

headcount in line with other telecom operators worldwide, management is working

towards the finalization of a scheme named as voluntary separation scheme (VSS).

There is improvement in the technology after privatization like DSL, BroadBand, IPTV,

optic fiber cables and voice messaging. Their is a great reduction in the international calls

rate. The U-Fone is earning large amount of profits, its efficiency has increased and

privatization has a positive effect on it.

He told us about the challenges which company is facing. The main challenges are

competition due to expansion, customer satisfaction and internal employees’ satisfaction.

39



Questionnaire


The students of International Islamic University design this questionnaire to research the opinion of official about the privatization of PTCL. The opinion of employees will be kept confidential.

Name: _________________ Occupation: ________________

1. Do you think there was a need of privatization of PTCL?a) Strongly disagreeb) Disagreec) Neutrald) Agreee) Strongly agree

Comment ______________________________________________

2. What do you think, which factor leads to the privatization of PTCL?a) Low efficiency b) Poor servicesc) Competition factord) less access of company to capital

Comment ______________________________________________

3. If the workers or employees of PTCL strongly rejected the privatization then don’t you think that it is better to go with employees?

a) Strongly disagreeb) Disagreec) Neutrald) Agreee) Strongly agree

Comment ______________________________________________

4. Do you think net profits of the company increases with the privatization of PTCL?

a) Yes b) No Comment ______________________________________________

5. Do you think the efficiency and productivity of the employees increases with the privatization of PTCL?

a) Strongly disagreeb) Disagreec) Neutrald) Agreee) Strongly agree

Comment ____________________________________________________

40



6. Are you satisfied with the salary packages and other facilities given to you after privatization of PTCL?

a) Yes b) No Comment ______________________________________________

7. Does the infrastructure of the company changes with the privatization of PTCL?a) Yes b) No

Comment ______________________________________________

8. Do you feel your jobs secured after privatization of PTCL?a) Strongly disagreeb) Disagreec) Neutrald) Agreee) Strongly agree

Comment ______________________________________________

9. Does the services offered to its customers increases with the privatization of PTCL?

a) Yes b) No Comment ______________________________________________

10. Which subsidiary of PTCL is earning more profits after privatization?a) U-foneb) Paknetc) None

11. Has there been an increase in employment opportunities after privatization of

PTCL?a) Yes b) No

Comment ______________________________________________

12. Has the network accessibility improved after privatization of PTCL?a) Yes b) No

Comment ______________________________________________

13. Have there been technological advancements after privatization of PTCL?a) Yes b) No

Comment ______________________________________________

14. Have the working environment improved after privatization of PTCL?a) Strongly disagreeb) Disagreec) Neutrald) Agreee) Strongly agree

Comment ______________________________________________

41




Questionnaire

Q. 1. Do you think there was a need of privatization of PTCL?

There is the mixed opinion of employees about the privatization of PTCL. Most of the

employees disagree with the privatization. The highest percentage and the comments of

employees show that they are not in the favor of privatization. The replies we received

for this question, the feedback results in 28% employee strongly disagree, 20% disagree,

6% are neutral, 23% agree whereas 23% of the employees strongly agree that there was a

need of privatization of PTCL.

42

Figure 5.Need of privatization of PTCL



Q.2. What do you think which factor leads to the Privatization of PTCL?

Mostly employees think that the factor which leads to the privatization of PTCL is

Competition factor. The feedback shows that only 17% employee think that low

efficiency leads to privatization of PTCL, 11% believe that less access of company to

capital was the factor that leads to the privatization of the company and 72% thinks that it

was because of the increasing competition in the telecom sector. Due to liberalization and

deregulation competition among telecom sector increases which leads to privatization of

PTCL.

43

Factor leading to privatization of PTCL

17%

0%

72%

11%

Low effiency

Poor services

Competitation

Less access ofcompany tocapital

Figure 6.Factor leading to privatization of PTCL



Q. 3.If the workers or employees of PTCL strongly rejected the privatization then

don’t you think that it is better to go with employees?

The

majority of the employees agree with this statement that the government must go with the

employee’s opinion. Most of the employees give their opinion that employees of PTCL

were not given importance during privatization. Top management did not consider their

opinion important while taking decision of privatization. On the other hand some

employees of top management said that it was in the benefit of the company to privatize

and it will be helpful for the employees in the future.

44

Figure 7.Opinion of employees



Q.4. Do you think net profits of company increases with the privatization of PTCL?

Figure 8.Net profits

The net profit of the company decreases with the privatization of PTCL. Most of the

people agreed that with the privatization net profits of the company decreases. Some of

them give their opinion that this reduction in net profits is due to increasing competition.

So there is not so much improvement in net profits after privatization.

45



Q.5. Do you think the efficiency and productivity of the employees increases with the privatization of PTCL?

Figure 9. Improvement in efficiency and productivity of employees

Most of the employees said that the efficiency and productivity of the employees has

decreased after privatization. They are quite confused after privatization and they can not

work properly under Arabs control which affected their efficiency and productivity.

Some of the employees have positive approach and they said the efficiency has increased

and now there is better environment for employees to work.

46



Q.6. Are you satisfied with the salary packages and other

facilities given to you after the privatization of PTCL?

i Thesis on “deregulation of telecom sector in Pakistan”by Maryam Malik, faculty of management sciences, department of technology management2006

ii www.wikipedia.com

iii http://www.ptcl.com

iv http://www.etisalat.ae

v PC Clarifies News Report on PTCL SaleIslamabad, August 31, 2006

vi Pakistan accepts Etisalat's $2.59 bln PTCL bid By Aziz Malik - Pakistan Times Federal Bureau Chief

vii PTCL announces financial results ,net down by 25%Published by Babar Bhatti on September 14, 2007

viii THE NEWS June 17, 2005 PTCL bidding tomorrow

ix DAILY TIMESSunday, June 12, 2005Govt announces PTCL bidding on 18th

x DAILY TIMES June 17, 2005 By Staff Report Malik calls sale of PTCL illogical

xi DAWN June 17, 2005 By Our Staff Reporter KARACHI: Rally against PTCL’s privatization held

xii Final project on “Pakistan’s telecom profile”by Syed Ali Faheem Naqwi, Faculty of Management sciences, department of technology management2005

xiii www.teralight.com/wpapers/how-PTCL-will-look-like-after-privatization.pdf

xiv Final project on Pakistan’s telecom profile

47



by Syed Ali Faheem Naqwi, Faculty of Management sciences, department of technology management2005

xv www.teralight.com/wpapers/how-PTCL-will-look-like-after-privatization.pdf

xvi Interview conducted from Mr.Gul Ahmed (executive vise president )Regulatory affairson 19th November,2007

xvii final project on “privatization of telecom sector”By Ali Hamza , Faculty of Management sciences, department of technology management2006 xviii

? Pakistani workers revolt against PTCL privatizationSecurity forces poised to attack occupationBy Vilani Peiris and Keith Jones4 June 2005

xix http://telecompk.net/2007/09/04/ptcl%e2%80%99s-privatization-the-biggest-financial-scam-in-pakistan%e2%80%99s-history/

xx Pakistani workers revolt against PTCL privatizationSecurity forces poised to attack occupationBy Vilani Peiris and Keith Jones4 June 2005

xxi Annual report of PTCL,2007

xxii http://telecompk.net/2007/04/29/ptcl-performance-review-recommendations/

xxiii Annual report of PTCL,2006

xxiv http://telecompk.net/category/ptcl/

xxv www.ptcl.com

xxvi Annual report of PTCL, 2007

xxvii http://telecompk.net/2007/08/06/the-road-forward-for-broadband-in-pakistan/

xxviii Annual report of PTCL, 2007

48

Figure 10.Satisfaction of salary packages



Most of the employees are not satisfied with their salary packages

and other facilities given to them after the privatization of PTCL. Some of the employees

said that after privatization there is no improvement in their salary. It is fixed from past 3

years. So they are not satisfied with their jobs. Their is only increase in the salaries of top

management and no special salary packages are given to lower level employees.

Q. 7. Does the infrastructure of the company changes with the privatization of

PTCL?

xxx Annual report of PTCL, 2007

xxxi Annual report of PTCL, 2006

xxxii www.teralight.com/wpapers/how-PTCL-will-look-like-after-privatization.pdf

xxxiii Annual report of PTCL, 2006

xxxiv www.ptcl.com

xxxv Annual report of PTCL, 2006

xxxvi http://www.itinsight.info/ptcl_likely_to_pose_more_profit.htm

xxxvii ? http://telecompk.net/2007/04/29/ptcl-performance-review-recommendations/

49



Most of the employees think that the infrastructure of the company has improved after

privatization .While 40% employees disagree with it they said that there is no change in

the infrastructure after privatization. The infrastructure of the company was not at all

good before privatization. There is much improvement after privatization.

50

Figure 11.Infrastructure of the company



Q. 8. Do you feel your jobs secured after the privatization of PTCL?

Figure 12.Security of Jobs

Most of the employees do not feel their jobs secured after the privatization of PTCL.

They said that after privatization fear develops among the employees that they could

be asked any time to leave the job. That’s why employees do not consider

privatization a good option. Only 20% of the employees feel their jobs secured which

is quite less and most of them belong to top management.

51



Q. 9. Does the services offered to its customers increases with the privatization of

PTCL?

Figure 13.Services offered to customers

Most of the employees think that the services offered to the customers by the

company increases with the privatization of PTCL. Many new services and packages

are introduced for customer satisfaction and for retaining customers in this period of

greater competition. Now many new packages and services are offered after

privatization. 34% employees said that the there is no improvement in the services

after privatization.

52



Q. 10. Which subsidiary of PTCL is earning more profits after privatization of

PTCL?

The majority of the employees think that the U-fone, subsidiary of PTCL is earning more

profits after privatization of PTCL and its profits and customers are increasing day by

day. It is one of the leading cellular company in Pakistan. 34% said that there is no

improvement in the subsidiaries of PTCL. No one thinks that there is any improvement in

paknet after privatization. Its profits are declining day by day.

53

Figure 14.Subsidiary of PTCL



Q. 11. Has there been an increase in employment opportunities after the

privatization of PTCL?

Figure 15.Employment opportunities

According to the employees opinion there has been an increase in employment

opportunities after the privatization of PTCL. Now many new employees have been hired

at different positions. On the other hand 43% disagree with it. they thought that after

privatization many employees leave the job so job opportunities do not increases with it.

54



Q.12. Has the network accessibility improved after the privatization of PTCL?

Figure 16.Improvement in network accessibility

Most of the employees agreed that the network accessibility has improved so much after

privatization. Now broadband is also introduced after which there is much improvement

in network. The network is extending day by day in smaller cities. On the other hand 23%

people disagree with it.

55



Q. 13 Have there been technological advancements after privatization of PTCL?

The technology has increased so much after privatization. Now the technology used is

according to latest needs.69% agree with that while 31% employees think that there is no

improvement in technology after privatization.

56

Figure 17.Technological advancement



Q. 14. Has the working environment improved after the privatization of PTCL?

Mostly employees disagree with this statement that the working environment improved

after the privatization of PTCL. Now employees are not so much motivated and sincere

to their jobs which affect their productivity. Only 23% of the employees think that the

working environment of the company has improved.

57



Conclusion & Recommendation

In our research project we basically want to know the factors which lead to privatization

of PTCL and the changes & improvement after the privatization of PTCL. Due to the

deregulation and with the increase in customers of cellular companies the growth of

PTCL decreased. PTCL was unable to survive in this era of competition. Factors’ leading

to the privatization is the tremendous Competition in the telecom sector. So privatization

became necessary for PTCL. During the privatization of PTCL many employees were

against of it. A large number of the employees protested against the privatization. But this

protest was ineffective so finally the privatization of PTCL took place on 18 June 2005.

The Etisalat owned PTCL has been engaged in battles with new competitors and

regulatory body (PTA) on one hand and faces internal organizational issues on the other.

Its profits have been sliding.The net profits of the company decreases by 5.14 billion. It

can be increased by attaining more and more customers and by offering different

packages.

After the privatization of PTCL the PTCL offer their employees voluntary separation

scheme (VSS). The company has also strengthened its regulatory department to better

manage regulatory affairs, license obligations and interconnection functions. But the

efficiency and the productivity of employees has decreased because employees don’t feel

their jobs secure. They are not satisfied with the salaries packages and the other facilities

provided them by the company which affects the productivity of both employees and the

company. The weak working environment of the company can be improved by

motivating the employees for achieving goals and objectives for the betterment of the

company. They can improve the efficiency of employees by increasing their salaries and

offering different bonus packages. Their should be permanent employment instead of

contract based employment to satisfy the employees.

After the privatization of PTCL the main focus of the company is to transform itself and

also the customer satisfaction. For their customer satisfaction PTCL offered the multi

58



channel Inter Protocol Television (IPTV) project, ‘Broadband Pakistan’, V-fone brand,

Dot.Com service and also, 330 new towns were brought on the Optical Fiber Network

expanding the facility to 1030 cites country wide. Another positive thing is that the rate

structure has also been simplified. Interestingly calls to mobile phones are Rs.

2.50/minute - it means it costs more to call someone in your own town than calling the

other continent. PTCL has decided to compete on volume than price. This goes to show

that with changing technologies and fierce competition brought by deregulation, price

barriers have been removed. The lower rates and simple rate structure brings relief to

consumers and makes their lives easier The PTA had noted service problems such as fault

in service, excess billing, fault-clearance, response-time and call failure rate. The

employees of customer and care department should be properly trained to handle

employees and their problems. PTCL need some good web development team that can

deliver a coherent and functional public interface for them.

Ufone is now considered to be one of the most active, aggressive and innovative players

in the mobile sector of Pakistan. under the management of Etisalat, Ufone will

concentrate on customer needs and benefits and is more determined than ever to be the

leading cellular player in the market. Ufone changed the image of mobile phones from a

luxury only affordable by the elite, to a necessity affordable by the common man.

PTCL also have to look on its sick units like Paknet an ISP and the CTRL labs which

haven't came up with any new researched technology for the company as well as for the

costumers

We can say that privatization was a good decision and it brings a revolutionary change in

the whole company. Privatization brings improvement in the technology and the services

given to the customers. Now customers are satisfied with different packages given to

them. Although many employees were against the privatization but it will be beneficial

for them and the company in the long run.

59



.

Reference:

http://www.monthlyreview.org/1005akhtar.htm www.ptcl.com www.ptcl.net www.privatisation.gov.pk

60



References

xxix www.ptcl.com

61


Ptcl Final Project

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