1.

0 Introduction
We are in the era of Digital Bangladesh. The Dream to establish the concept of Digital
Bangladesh targets the development of telecommunication sector in Bangladesh. With
the little boundary limit of our country we have a huge population & to use that
population as manpower telecommunication takes the foremost role. Communication
plays lead role to development and as the gap between rural & urban civilization in
Bangladesh is big so telecom in the only medial that can reduce the gap. Although the
penetration of mobile is large in urban areas in Bangladesh but in rural level it haven’t
been developed yet. The entrance of mobile technology was first started from the rural
area by Grameenphone’s Village phone, the aim was to develop living hood of the rural
people by giving them better communication offer, but periodically it moves to urban
areas, but ultimately rural world kept aside. But once again the telecom industry is now
moving to rural areas to create higher penetration of users from villages to let them use
the technology & get benefited from it.

Of the total telephone count in Bangladesh, approximately 20 percent serve the rural
areas, areas which house 80 percent of the total population. The need for
telecommunications sector investment and growth is obvious. This is especially so if
Bangladesh intends to participate and coexist economically and socially in a larger
information-intensive world.

2.0 Objective and Scope

The objective of this paper is to highlight the practice of innovation strategy in
telecommunication industry in Bangladesh. At the same time, to identify the challenges
and shortcomings in the implementation of innovation strategy in this sector. From the
findings of this study, organizations in this sector will be able to find some effective
guidelines in configuring their innovation scheme for their competitive advantage.
3.0 Methodology
For this study mainly secondary data and information have been used. In some cases
primary information has been used to clarify the decision of innovative side. Secondary
data and information have been collected from internet, newspaper, existing literature,
magazines etc. Personal observation has been a key source for data validity and
reliability. Sometimes personal interview has been conducted with various employees of
different mobile phone companies. Various mass media advertising are closely observed
and taking the reaction of viewers for creative advertising.

4.0 Telecommunication Industry in Bangladesh

Bangladesh has currently six mobile phone operators & about 12 PSTN operators in
Telecommunication Industry. AS for now the telecom industry has become the fastest
growing industry in Bangladesh as Bangladesh is known as a poor country. With the
penetration of about 32.10%.Compared to other countries figure is seems very large.

Country Population(mn) 3Q‘08 Mobile Penetration

Malaysia 27.2 96.00%
Thailand 66.5 90.60%
Philippines 91.1 72.40%
Pakistan 164.2 55.40%
Vietnam 85.9 63.40%
Indonesia 234.7 50.40%
China 1,321.30 46.20%
Bangladesh 140.6 32.10%
India 1,110.40 26.50%

Table 1: Countries with mobile penetration.

GrameenPhone, the largest mobile operator in the country, reached 21.16 million at the
end of June, while AkTel, acquired 8.85 million subscribers,

In the challenging industry Banglalink, acquired 11.04 million subscribers & took over
AkTel’s position and placed 2nd now, As a slow mover Warid telecom is going with 2.58
million subscriber, while the only CDMA operator, CityCell, acquired nearly two million
customers at the end of the june 2009. The government-owned Teletalk acquired nearly
1.1 million customers in mid 2009.

Bangladesh is presently one of the top 10 mobile phone markets in the Asia-pacific
region in terms of the number of subscribers. Industry people said the number of mobile
phone subscribers will top 50 million in the next three years as the start-up cost as well as
call tariff will be constantly shrinking because of cut- throat competition among the
operators to woo new customers.

5.0 Players in the telecom industry:

Telecom industry in Bangladesh has number of payers, from PSTN (Public switched
telephone network) to mobile operator, they tightly compete with each other by providing
better package offer & customer service to grab attention of the existing subscriber & the
future possible subscriber segments. The present players in Bangladesh
telecommunication industry are:

5.1 The PSTN operators in Bangladesh are:

* BTCL Former BTTB

* Ranks Telecom Ltd.
* Tele Barta Ltd. - branded under the nameJubok phone.
* Jalalabad Telecom Ltd. - branded under the name Bijoy Phone.
 * Onetel Communication Ltd.
* National Telecom Ltd.
* Peoples Telecom Ltd.
* Westec Ltd.
* Dhaka Telephone Co. Ltd.
* Integrated Services Limited (ISL) - branded under the name Sheba Phone
* S.A Telecom System Ltd.
* Banglaphone Ltd.

The number of PSTN subscribers in Bangladesh as of February 2009 was 1.417 million [1]

Operators Subscribers
BTCL 872.409
Ranks Telecom Ltd. 168.037
Telebarta Ltd. 56.424
Jalalabad Telecom Ltd. 5.053
Onetel Communication Ltd. 38.912
National Telecom Ltd. 81.263
Peoples Telecom Ltd. 85.91
Westec Ltd. 17
Dhaka Telephone Co. Ltd. 65.92
Sheba Phone Ltd. (ISL) 10.019
S. A. Telecom System Ltd. 16.373
Banglaphone Ltd. 0.026
Total 1417.346

Table 2: PSTN operators & their subscriber amount in Bangladesh

5.2 Mobile phone operators:

There are 6 mobile phone operators in Bangladesh. These are:

1. Grameenphone Ltd 2. Aktel

3. Banglalink 4. Citycell
5. Teletalk Bangladesh Ltd 6. Warid Telecom (Bangladesh)
The number of mobile phone subscribers in Bangladesh as of June 2009 was 46.69 million.
 Operators Jun-09 Jan-09

Grameenphone 21.16 20.94

Banglalink 11.04 10.41

Aktel 8.85 8.47

Warid 2.58 2.25

Citycell 1.96 1.83

Teletalk 1.1 0.84

Total 46.69 44.74

Table 3: Total mobile subscriber

Table 4: yearly net subscriber addition

Table 5: Major mobile operators

6.0 Competition in Mobile Telecommunication Industry in Bangladesh
As mentioned it earlier that GrameenPhone is the market leader with approximately 63%
market share (http://press.telenor.com). From the market share and technical capability
point of view, GP is clearly ahead of other competitors. Although Banglalink/Aktel were
the challenger but its activities was not so much threat for GP. Since the market payers
designed their strategy with traditional armors therefore, the culture and practice of
innovation was not appropriately nurtured in this industry. Banglalink & Aktel tried to be
innovative and to provide unique value to the customers but it could not be effectively
successful as GP responded immediately in unconstructive ways. Even sometimes in a
very negative way (e.g. network jamming, price cut and so on), which was to some extent
unethical, too. For example, when Aktel planned to provide augmented service to
customers, GP would create an unannounced barrier in case of calling and messaging
from Aktel to GP subscribers to create an impression that Aktel’s network is not as
efficient as GP. Ultimately, the innovative efforts of Banglalink/Aktel were not fully
successful. The company (GP) used to enjoy almost a monopoly until and unless the
threat was created by other competitors.

7.0 Innovation Warfare– A Brief Analysis of the Situation

Bangladesh mobile telecommunication was an intangible dominant pure service industry
which deals with the network system only. The traditional thought totally ignored
consumer day to day life aspect and did not try to explore how mobile phone service can
be an indispensable part of our daily life to be specific how it can make life easy and
dynamic. The consumers were being deprived of getting the optimum value from the
mobile telecommunication service. Banglalink could identify the gap between the
product concept and its ultimate utility of the product. Usually a winning product has
multi dimensions so that it can serve customers from various spectrums. A product must
posses three level of identities. The first level is the essence of a product—how well it
satisfies the customer’s needs. The second level is the physical product, should it be a
good or a service. The third level is the product’s shell. It includes all the additional
products and services offered with the product to exceed customer expectations. If
customer satisfaction exceeds the expectation level then the customer is delighted and
only then it is possible to retain that customer. Otherwise, there is a probability of
switching. As GP almost overlooked the third product level, Banglalink concentrated on
this gap and tried to fill this gap. Banglalink wanted to The success of their product
designing was the precise articulation of the latent demand of customers. Their major
offer was free phone set with mobile phone network connectivity. Their offers were
neither the familiar tangible goods with accompanying service nor major service with
accompanying minor goods and services. It was major service with accompanying major
goods. It could be called as ‘hybrid’. Actually it was more than hybrid. Hybrid offer
consists of equal parts of goods and services, for example, people patronize restaurant for
both food and services. Here without one part another part can be consumed. However,
Banglalink’s offer was major service (network) with accompanying major goods (mobile
phone) and minor services (free calling option) also. Previously, any company of this
industry did not offer hybrid services or aforesaid services rather offered pure service.
Banglalink was the first to introduce this type of offer in Bangladesh. As it offered major
services along with major good and also minor services like warranty of the mobile
phone, free calling card and some charged units in the phone that can be used for calling
or messaging before charging anything, so we can call this innovative package as major
service with accompanying major goods and minor services, or pure service with forward
integration with major goods and minor services. GP- the market leader reacted before
any severe damage. They decided to neutralize each Banglalink offer, product to product
basis. They came up with more augmented offers. They provided exclusive emphasis on
information service through their existing mobile network. GP’s information service
includes news, events of the day, transportation schedule, horoscope, etc. Also available
are news service, channel program schedule, event-based sports update. The subscriber
has to simply dial a specified four-digit number to listen to the information. ‘Cell E-mail’
offers the e-mail service through SMS. It possesses almost all aspects of the standard web
mail and is compatible with almost all GSM handset. GP’s business solution has a unique
option called ‘EDGE’ (Enhanced Data Rates for Global Evolution), which enables high-
speed mobile Internet and data services. This is up to eight times faster than GPRS
(General Packet accelerate customer attraction faster. To do this they decided to offer ‘
major service with accompanying major goods’. Radio Service). Another of GP’s
unusual service is its ‘Insta-Care’, an automated service with IVR (Integrated Voice
Response) system for all kinds of GP service-related queries. This service is open 24
hours a day, all the year round. In addition, Insta-Care has a general information aspect
where travel, hotels and restaurants, emergency numbers, hospitals and clinics, legal aid,
taxicabs information, and district and country dialing codes are available.

The ‘Village Phone Program’ of GrameenPhone is a unique initiative that provides access
to telecommunications facilities in remote rural areas, where no such service was
available before. The program allows poor village women to own a Village Phone
subscription and retail the phone service to her fellow villagers while providing them
with a good income-earning opportunity. It is administered by GrameenPhone, in
cooperation with Grameen Bank, the internationally renowned micro-credit lending
institution.

GP’s this strategy made a quick impact over the consumers. Previous GP consumers who
switched to Banglalink some of them stopped using Banglalink SIM and started using the
GP SIM with the mobile phone that they got as free with the Banglalink SIM. It really
shocked Banglalink. In order to retain their new customers Banglalink introduced some
new more offers, free text messaging for six months even they extended this free
messaging outside the country at local charge.

Though almost everything was going smoothly for Banglalink, gradually it faced some
problems. Its main problem was interrupted network. On the contrary, the main
competitive advantage of GP was its uninterrupted network system. However, Banglalink
could sustain many of its customers with its innovative e strategy and managing that
tactfully. And in the mean time they are also trying to improve their network connection
by importing some devices that can improve network connectivity.

But one blow came when dual SIM system that enables using two SIM in one mobile
phone was introduced. Before this some customers who wanted to use GP and Banglalink
simultaneously continued using Banglalink as keeping two mobile set was not
convenient. So, Banglalink got some preferences. But after the introduction of Dual SIM,
a thin electronics device that can be set inside the mobile set, many mobile users started
to use that. Mostly they were on line with GP and when they needed to send SMS they
switched to Banglalink as SMS through it was free at that time. Though dual SIM mostly
was used in the urban area, it may be reached at the rural area due to marketing activities.
So, Banglalink faced a big threat from the electronics industry not from the GP or other
telecommunication companies and it was unexpected for the Banglalink. Only time will
say what strategy it takes to overcome this obstacles.

8.0 Offering the cutting edge technology

The modern telecommunication is offering new & new technologies to attract subscriber
& also to enhance the communication path. With the introduction of wireless technology,
it's no more necessary to stay seated at a particular place to get the Internet service. Most
of the portable PCs now have built-in wireless facility to let its users surf the net.
Recently cell phones have also come up with wireless Internet access facility.
Increasingly mobile phone operators are becoming the key players in distributing this
service to the people.

Mobile phone operators in developed countries have already included this facility in their
service; they are in fact emerging as the potential competitors of ISPs. From technical
point of view and keeping in mind the subscriber base, Bangladesh is still at the nascent
stage of this connectivity. But this technology holds out a bright future, as the Internet is
gradually becoming commonplace in the country.
Now in Bangladesh, Citycell, Grameenphone, Aktel, Teletalk and Warid Telecom offer
mobile Internet service to their subscribers. Citycell uses CDMA technology while others
the GSM. Not just the mobile operators, PSTN operators are also offering wireless
internet offer through then provided handset which is changing the PSTN worked earlier
in our country.

By the mycitycell ZOOM', the brand name for data service from CityCell they have
introduced a mobile Internet service named 'mycitycell ZOOM' for business people and
general customers as well. This technology allows subscribers to enjoy high speed
Internet from any place within the Citycell network

Grameenphone the first GSM-based cell phone operator in Bangladesh have introduced
cutting edge mobile technology EDGE (Enhanced Data rates for Global Evolution) in
order to promote mobile Internet service. According to Grameenphone, EDGE is eight
times faster than GPRS, and now Grameenphone is offering Grameenphone EDGE
modem to its subscriber with the theme “Alo Ashbey” means no barrier can stop people
from getting the knowledge & information, light will come will give a new horizon of
communication. CellBazaar, an innovative market-access service from Grameenphone
Ltd., has won the 3GSMA Global Mobile Award 2008, in the category of "Best Use of
Mobile for Social & Economic Development."

Aktel, Warid & Teletalk also giving similar GPRS based service to their subscriber

9.0 Creative warfare: In an advertising sector

Advertising sector of an industry is a very important sector. Creative mind and result of
creativity is the main weapon of this sector. Nowadays we are closely observing the
severe competition among the mobile companies. In this race promising company
Banglalink is clearly ahead. Their various mass media advertisements are well accepted
and have become popular. They try to offer a very clear message to the people. How
technology act as a catalyst of changing people’s lives are ensured by this company. ‘Din
Badaler pala’ (phases of changing life), ‘Bhashar janna Bhalobsa’ (love for language) of
Banglalink are well accepted and people are able to understand the clear message of this
ad & now the are creating more melody focused advertisements to tell people the colorful
side of life with friends & family. On the other hand GP tries to relate their ad with

people’s problems. As example, just a call then you will get a medical help. Business
solution, pacer hunt are another well accepted ad of Grameenphone Company. Aktel is
little bit lag behind than other companies, especially in advertising sector. Besides these
their one ad on television channels (call whole month and save some portion of money
for the next month ) is able to cut a position of people’s mind. The pacific Bangladesh
telecom (city cell) also concentrates on effective advertising methods. Their ‘Hello
tunes’, offering fixed low call rate to all, so everyone becomes F&F, is accepted by the
subscribers. Another package offer of City cell like ‘tk.1399/ -’ (named –‘sab pai’ i.e. all
in one package) is able to capture the market. All warfare in creative side are blessing to
the subscribers. Subscribers have the right to know. By exerting creative efforts
Telecommunication Companies try to keep subscribers up to date.

10.0 Corporate social responsibility:

Telecom operators are playing a key role in Bangladesh in conducting CSR activities.
Every year people of Bangladesh are affected by many natural disasters & every year
telecom operators contribute large amount of money & other help services to this disaster
victims. Beside this to make a successful digital Bangladesh these telecom operators
donate laptops, pc’s into many schools, collages.

Besides helping human life, telecom operators are also engaged them into conserving the
Clean & green environment. Like Banglalink has given Dhaka International Airport - the
gateway of Bangladesh a completely new look. Provision of high quality passenger
trolleys, phone booths, emergency charging station and beautification of the premises is
an exemplary initiative which no other multinational has taken. Banglalink also
contributed to an important tiger conservation project in the Sundarbans, and continues to
support the Cox's bazaar beach cleaning program., GP recently started a campaign to
make the Bangladesh green by the theme ”Stay Green Stay Close” by distributing free
tree seed to each and every people.
11.0 What next?

The Bangladesh telecom industry is in total penetration position right now, & grabbing
new customer has become a really challenging task. The next step the operators choose is
to make the customer retention stronger by giving them more innovative services through
the existing mobile network. They are now focused to make customer satisfaction more
easy & reliable to its customer. The other thing that the telecom industry players are

doing is diversifying their business from core mobile base service to other services using
there network facility. Telecom operators are not moving into health care business (GP
Healthline), Education services (GP education service) agriculture services (Banglalink
Krisi jiggasa), now they are moving in to e-commerce and also many other services.
Beside this they are also in the process of introducing 3G services in Bangladesh, by
which video calling, conferencing & watching videos in call phone can be possible
easily.

12.0 Conclusion:
The contribution of telecommunication industry in Bangladesh is very large. It reduced
the gap between human to human and also working heard to make people to stay close.
Although few mobile & PSTN operators were charged & fined large amount of money
for illegal VOIP involvement, but operators are now very careful to be abide by the
government law and operate there business maintaining the code & conduct of law. The
journey of modern technology has no ending, new feature & services will come & take
over old ones, so it is just a matter of time to transform our country into Digital
Bangladesh through the light of advanced telecommunication innovations.
Reference:
http://en.wikipedia.org
http://www.grameenphone.com
http://www.aktel.com
http://www.banglalink.com
http://www.citycell.com/
http://www.thedailystar.net
http://prothom-alo.com
http://www.btrc.gov.bd
http://www.google.com