Grameenphone

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➢ Introduction:

Environment refers to all external forces which have a bearing on the functioning of business. Environment factors or constrains are largely if not totally, external & beyond the control of individual industrial enterprise & their management. These are essentially the ‘givers’ within which firms & their managements must operate in a specific country & they vary, often greatly, from country to country. The business environment possesses threats to a firm or offer immense opportunity for potential market exploitation. As per this definition, environment includes such factors as socio-economic, technological, suppliers, compliers, and the government. These environmental external factors are called PESTLE and the analysis of an external factor of a company is called PESTLE analysis.

➢ Background of the company:

Grameenphone Ltd. is the largest telecommunications service provider in Bangladesh, received its operating license in November 1996 and started its service from March 26, 1997. Now, after 11 years of successful operations, Grameenphone is the largest mobile phone service provider in Bangladesh, with more than 28 million subscribers as of November 2008.

The idea of providing mobile phone facility to rural areas in Bangladesh was originally conceived by Iqbal Quadir, who is currently the founder and director of the Legatum Center for Development and Entrepreneurship at MIT . He was inspired by the Grameen Bank micro credit model and envisioned a business model where a cell phone can serve as a source of income. After leaving his job as an investment banker in the United States, Quadir traveled back to Bangladesh, after meeting and successfully raising money from a New York based investor and philanthropist Joshua Mailman, and worked for three years gaining support from various organizations including Nobel Peace Prize laureate Muhammad Yunus of Grameen Bank and the Norwegian telephone company, Telenor. He was finally successful in forming a consortium with Telenor and Grameen Bank to establish Grameenphone. Quadir remained a shareholder of Grameenphone until 2004.

Basically Grameenphone is a joint venture enterprise between Telenor (62%), the largest telecommunications service provider in Norway with mobile phone operations in 12 other countries, and Grameen Telecom Corporation (38%), a non-profit sister concern of the internationally acclaimed micro-credit pioneer Grameen Bank. Over the years, Grameenphone has always been a pioneer in introducing new products and services in the local market. GP was the first company to introduce GSM technology in Bangladesh when it launched its services in March 1997.

➢ Political influence:

Government plays a significant role in the telecommunication industry by putting restriction on the network system the companies should use. In addition, every offer a company makes to its customers is watched by the government. Previously government has banned the companies from offering free calls especially after midnight. These facts play important role in Djuice’s operation as well. After that the government has imposed more tax upon the call rate of the telecommunication industries. Hence, the Grameen Phone Company was hampered by their profit & they also increased their call rate to reduce their profit as well as to cover up the amount of tax from the general people. So, as there was no increase in disposal income of the general people, either they had to leave Grameen Phone or pay more in per call charge. So, people’s savings was decreased by the amount they increased the call rate which put a negative impact on the economy.

➢ Economic environment:

Economical imbalance was created by Grameen phone because of the political influence. As the government imposed more tax on the company, the disposal income & the amount of savings has fallen down. We already know that the investment &...
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