Grameenphone, partners in the transformation of Bangladesh

Three decades ago, when men from Bangladesh went to the Middle East in search of jobs, leaving their families back in remote areas of Bangladesh, they communicated through letters around once or twice a year. Children grew up without knowing their fathers.

The scenario started changing after 1997. Palliphone (village phone) service started to open in villages. Parents, wives and children went to the certain Palliphone point. A call came from either Saudi Arabia or Kuwait and mothers then heard the voice of their sons after many days, wives talked to her husbands and children to their fathers.

It is 2022 now. People no longer need to walk to the bazaar now. People can talk to anyone anytime from anywhere in the world. Not only through a phone call, mothers can now can see their sons in video calls; a father can see his son walking in a video call too. The woman who went to the Middle East for a job can now see the face of her son whom she has left behind at home.

Transformation has taken place in not only in people-to-people communication but also in every aspect. Mobile phone becomes the main mode of selling products and keeping tabs on the market. Internet spreads outsourcing jobs in remote districts. Vehicles arrive at doorstep in just a touch of a mobile phone. There is no need to go to the market to buy food, groceries, fish and vegetables anymore. Mobile phone also became the medium of education during the coronavirus pandemic.

Mobile phone operator Grameenphone is the biggest partner of such telecommunication and social transportation of Bangladesh. Telecommunication services spread to the grassroots through the Palliphone service, which was launched from village to village through Grameenphone and Grameen Bank that began its journey on 26 March 1997. Twenty-five year later, high-speed 4G internet service has arrived from village to village now. Smartphone is now available to everyone.

Mobile phone has made life easier as well as advanced the economy. Today, the telecommunication sector, according to the Bangladesh Telecommunication Regulatory Commission (BTRC), contributes about 6 per cent of the country’s Tk 28 trillion (28 lakh crore) gross domestic product. Currently, there are more than 178.6 million (17.86 crore) mobile users (a person may own more than one SIM) and about 125 million (12.5 crore) mobile internet users in the country.

About half of the mobile users, 83.3 million (8.33 crore), use Grameenphone. Grameenphone also earns highest revenue and profit and provides dividends more than three other telecom operators -- Robi, Banglalink and Teletalk. Grameenphone will also be among the top businesses operating in Bangladesh.

Asian Development Bank prepared a “Performance Evaluation Report” on Grammenphone in 2013. It said, in 1996, Bangladesh had a telephone density of about 0.3 lines per 100 inhabitants — the 13th lowest in the world and third lowest in Asia at that time. Seventy percent of telephone lines were located in three metropolitan areas— Chittagong, Dhaka, and Khulna. The rest of the country had less than one telephone per 1,000 inhabitants.

At that time, the state-owned Bangladesh Telegraph and Telephone Board had about 350,000 subscribers and the lone mobile phone operator Citycell had about 20,000 subscribers.

People concerned said, in 1996, then-Awami League government licensed three mobile operators – Grameenphone, Aktel (now Robi) and Banglalink – to break monopoly in mobile phone services, make the service available to people and expand telecommunication services. And, Grameenphone started operating firstly. With funding from of Norway’s Telenor Invest, Grameenphone was founded at the initiative of Noble Peace Prize laureate Dr Muhammad Yunus and Gonophone Development Corporation founder Iqbal Qadir. The company started it journey on the Independence Day on 26 March 1997.

Then and incumbent prime minister Sheikh Hasina made the first mobile call to Palliphone entrepreneur Laily Begum on the day of inauguration.

At that time, Grameen Bank provided loan for purchasing Palliphone (village pay-telephone or VPT) to take mobile phone to rural areas. Subscribers purchased those mobile phones and provided services to people in exchange of a certain amount of money per minute, thus, expanding telecommunication services to villages. The ADP report said the number of VTP service providers surpassed 94,000 in 2004 from 179 in 1998. Citing a 2011 survey, the report said Palliphone entrepreneur earned on an average Tk 830 a month and contributed 12 per cent of their family income.

Since mobile phone become available, there is no Palliphone service anymore. And the remarks of an entrepreneur highlighted how this service had an impact on the people’s lives at that time. Entrepreneur Parveen Begum was quoted in an article of the Latin American Council of Social Sciences (CLACSO) as saying, “The mobile phone is like a cow. It gives me '“milk” several times a day. And all I need to do is to keep its battery charged… It has now connected our village with the world.”

Then-US president Bill Clinton visited Bangladesh in March 2000. He was also quoted in the CLACSO’s publication as saying, “I want my fellow Americans to know that the people of Bangladesh are a good investment. With loans to buy cell phones, entire villages are brought into the information age. I want people throughout the world to know this story.”

ADB said the model of Palliphone service was later followed in Cambodia, Haiti, Indonesia, Philippines, Rwanda and Uganda.

When Grameenphone started its journey in 1996, it was a private limited company. Telenor Invest, now Telenor Mobile Communications, held 51 per cent of shares of Grammephone while Grameen Telecom had 35 per cent, Marubeni Corporation 9.5 per cent and Gonophone Development Corporation held 5 per cent shares. In 2004, Gonophone and Marubeni sold their shares to Telenor and Grammen Telecom respectively.

Grameenphone enlisted in stock market in 2009. Currently, Telenor holds 55.80 per cent of Grameenphone’s shares and Grameen Telcom has 34.20 per cent of shares. Other than theses, employees of Grameenphone and general people hold the shares of the company.

Data from Dhaka Stock Exchange (DSE) website shows, Grameenphone provided 275 per cent of dividend on its share priced at Tk 20 in 2020.

Jorgen C Arentz Rostrup, head of South Asia at Telenor, the parent company of Grameenphone, told Prothom Alo on 14 March that Bangladesh and Grameenphone is something special to Telenor and it is one of top Telenor companies in terms of profit rate.

To date, Grameenphone has invested Tk 416.60 billion (41,660 crore) over the past 25 years.

Since its inception, Grameenphone has paid Tk 956.50 billion (95,650 crore) to the state exchequer as of December 2021. The company paid the government Tk 100 million (10 crore in 1996) and Tk 102.80 million (10,280 crore) in 2021. This money includes tax received from customers, income tax, and various fees including spectrum fees.

Asked on the state of relations with the government and the regulator over the past 25 years Grameenphone chairman Jorgen said, “The regulators are very active about their operation. Sometimes, various issues require talks and it not that we agreed to everything. However, we have got the opportunity to speak as well as hold talks all the time.”

Nonetheless, questions remain on the quality of service in the country’s telecommunications sector. Grameenphone had face criticisms and they still do. Even, officials of the telecommunications-regulating agency also express discontent on this matter

BTRC chairman Shyam Sundar Sikder during his address of welcome at Grameenphone’s silver jubilee event thanks the company. He also stressed on increasing the quality of service. Though Grameenphone says it has been trying to develop the service quality and that does not depend on telecom operator only.

It was learned from newspapers published in 1997, collected from Dhaka University Library, and speaking to people concerned, that at the beginning Grameenphone set the minimum price of SIM and mobile phone at Tk 18,100 along with a Tk 5,000 deposit. Before that, price of a CityCell handset was at Tk 75,000 and both outing and incoming calls were charged with outing call spending Tk 27 a minute.

Grameenphone fixed call charge at Tk 6.90 minute including VAT. Now call charge is below Tk 1 a minute; mobile phone is available at less than Tk 1,000 and SIM is cheap too.

At that time, network was necessary for people to talk over mobile phone. Now they are in need of high-speed internet and better service like the youths from ethnic minority community from Madhupur, who freelance through internet. A report titled “Subir earns dollars from his village” was published in Prothom Alo on 18 February. But the youth face hassle over the internet and they wanted high speed internet.

Grameenphone chief executive officer (CEO) Yasir Azman saw the report. So, he made the arrangement to install temporary tower there. He himself went to Madhupur on 12 March. The CEO at a rally announced to install a permanent tower in the area.

Referring to that event at a press conference in the capital on Sunday, Yasir Azman said when the tower started functioning at 1:30am in mid-night, people of Madhupur started dancing out of joy and this the power of connectivity.

And, a mobile has, in fact, become part and parcel of the lives and livelihood of the people now.

This report appeared in the print and online edition of Prothom Alo and has been rewritten in English by Hasanul Banna