1 ichiro tambo advisor on science & technology development co-operation directorate oecd grameen...
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Ichiro TamboAdvisor on Science & Technology
Development Co-operation DirectorateOECD
Grameen Village Phone Lady
Community Telecenters
As Community Telecenter in Rural Bangladesh
International Seminar on ICT Policy Reform and Rural
Communication Infrastructure23 August – 1 September 2004,
Japan
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Q1: Bangladesh: what is the general situation?
The people’s Republic of BangladeshSouth Asia, N-W India, E-India & Myanmar, S- Bay of BengalArea: 47,570 sq KmCapital city: DhakaPopulation: 135.6 millionReligion: M-88%, H-10.5%, C-0.3%2002/2003 GDP: US$ 52 billion (US$ 388/per capita-annum)Main productions: jute, tea, textiles, garments, paper, fertiliser, leather and its goods, sugar, cement, fish processing, pharmaceuticals.
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Q2: What is the situation of the telecom sector?
5 OperatorsFixed-line - BTTBMobile - GrameenPhone,
Aktel,Sheba and City Cell
Teledensity in South Asia, 2002
05
1015
2025
30
Bangla
desh
India
Mal
dives
Nepal
Pakis
tan
Sri Lan
ka
Fixed Lines
Cellular Mobile Subscribers
Total Fixed and Mobile
Source: World Telecommunication Development Report, ITU, 2003
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Q3: What is the Village Phone Programme?
Administered by Grameen Telecom, not-for-profit companyBrief Business Model:
A person, usually women, buys a telephone handset and subscriptionGrameen Bank provides the person with necessary financingShe retails phone services to villagersThrough retailing, she pays off her loan and makes a livingShe benefits from a tariff discount system.
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Q4: What kind of partnership is involved?
Programme Administration: Grameen Telecom
Telecom Service Provision: GrameenPhone Ltd.
Micro credit and Support: Grameen Bank
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Partnership of GrameenPhone Ltd.
GP mobile phone subscribers in Bangladesh
GrameenPhone(for-profit)
“Village Phone” programme(Operators or VP ladies)
Telenor AS
Marubeni
IFCAsian Development BankCDCNORAD (NORFUND)
Debt Financing
Support- Programme management
- Training of operators- All service related issues
Microcredit
Grameen Bank(for-profit)
Tariff Discount
Mobile phone and related services
Soros Foundation
51%
9.5%
4.5%Gonofone
35% Equity investment
Grameen Telecom(not-for-profit)
Debt Financing
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Q5: What is the role of Grameen Telecom?
Programme Management
Training of Village Phone Ladies (operators)
All service-related issues supported by Grameen Bank and its family organisations
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Q6: How does the tariff discount work?
* Invoices are translated in Bangla by Grameen Telecom
Phone Service
GrameenPhone Ltd
Purchase of air time at discounted rate (50%)
Billing *Billing
Aggregate Payment Phone Bill (50%) +Commission (15%)
Tariff at market rate(100%)
Grameen BankBranches
Village Phone Operators
Phone Usersin villages
45,000 operators in approx. 39,000 villages
Aggregate Monthly payment
70 million people in rural areas have access
Grameen Telecom
Tariff Discount System
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Q7: Is this discount system sustainable?
VP Ladies: business opportunity
GrameenPhone: guaranteed revenue / no extra cost
Grameen Telecom: Cost recovery / no subsidy
Phone users:no physical trips / market rate phone
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Q8: How does the Village Phone lady make money?
Revenue
Cost /Profit
Phone bill paid to
Grameen Telecom(50%)
Commission paid to
Grameen Telecom
(15%)
Marginal Profit (35%)
Instalment to Grameen Bank
Net profit
Phone User Village Phone
Operator
Tariff at Market Rate(100%)
Cost Structure for Village Phone Operator
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Q9: What is the Programme Management Policy?
Strict rules of the programme
Sequential approach in villages
Monopoly Competition
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Q10: How is extensive service coverage provided?
1,800 Km fibre optic backbone
Continuous increase in the number of base stations
Strong emphasis on operational excellence and efficiency
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Coverage
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Q11: Can this be replicated elsewhere?
MTN Village Phone in Uganda
Success factors?
Other replication initiative in Latin America
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Q12: What are the lessons learned?
Creative partnerships can expand infrastructure services beyond profitable areas
Strong leadership and ownership of the local partners are critical
Synergies between business objectives and development goals are possible.
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Thank You !
Ichiro TamboAdvisor on Science & Technology
Development Co-operation Directorate
OECD
ichiro.tambo@oecd.orghttp://www.oecd.org/dac/ict
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