Report on Telenor 1

A Report
Report on Telenor ii

on
telenor
Acknowledgement

At first, I would like to thank Allah Almighty most Beneficiary the merciful enable us to
complete this project report.

Then thankful to our Marketing Professor Ms Raheela who teach us marketing concepts
that we apply in this report.

Many thanks also to my group members who shared time with together and also share
their knowledge and ideas to complete this project.

One of our senior Waqas Butt who guides us to complete this project. Our college teacher
Mr. Mahboob Asim Bloch who provide us reference at Telenor.

Thanks to all class fallows who had shared ideas on different topics and had really nice
time with them.

And in last thanks Ch. Ali Abbas the manager telenor Cantt franchises who provide us
data about telenor.

20 April, 2008

Muhammad USMAN

Group Leader
Report on Telenor iii

Our Group
Name Sr. #

Muhammad USMAN 18

Muhammad Bilal 24

Usman Younis 26

Ahmad Arslan Butt 31

Sohail Ashraf 41
Report on Telenor iv

Table of Content
• History…………………………………………………………………6
o Major Shareholders……………………………………………7
o World wide Coverage…………………………………………8
o Telenor in Pakistan……………………………………………9
• Telenor at Glance……………………………………………………..11
• Portfolio……………………………………………………………….12
o Mobile Phone Services……………………………………..…12
o TV and Broadcast…………………………………………..…12
o The Internet……………………………………………………12
• Vision………………………………………………………………….13
• Values………………………………………………………………….13
o Be Respectful………………………………………………….13
o Be Inspiring…………………………………………………....13
o Keep Promises………………………………………………....13
o Make it Easy………………………………………………..…13
• Mission………………………………………………………………..14
• Objectives……………………………………………………………..14
• CEO’s ………………………….……………………………………..15
• Directors……………………………………………….………………16
Report on Telenor v

• Products & Services……………………………………...……………19

o Mobile Fun……………………………………….……………19
o Mobile Interaction…………………………….………………20
o Mobile Commerce…………………………….………………22

• Research - the Future is now………………………….………………23

• Segments………………………………………………………………24
• SWOT Analysis……………………………………….………………25
o Strengths………………………………………………………25
o Weakness………………………………………………………25
o Opportunities………………………………………………….25
o Threats…………………………………………………..…….25
• Marketing Strategies………………………………………….……….26
o Deliver increased profitable growth………………….………..26
o Strengthen our performance culture across the Group……..…26
o Make responsible business a competitive advantage……….…26
o Provide a superior customer experience……………………….27
o Ensure best practice benchmarking across the Group…………27
o Drive change and constant renewal……………………………27
o Improving our performance management……………………..27
o Challenges ahead………………………………..…………….28
• Marketing Mix………………………………………..……………….29
o Product………………………………………………….……..29
o Price………………………………….………………………..30
o Place……………………………………..…………………….31
o Promotion………………..…………………………………….31
Report on Telenor vi

• Major Competitors…………………………….……………………....33
o Major competitor………………………………………………33

• Conclusion…………………………………………………………….34
• References……………………………………………………………..35
Report on Telenor 6

H is t or y of Te l e nor
Telenor is the leading telecommunication company in Norway, which is one of the most
advanced telecommunication markets in the world. Norway has one of the world’s
highest penetration rates for mobile, fixed line digital telephony, personal computer and
internet usages. The history of Telenor goes back a long way in 1885, when telegraphic
service was established under the name of “Telegrafverket- a government institution”.
The Norwegian Telegrafverket has had several names throughout the time of existence. In
1968, the organization of Televerket has been changed. The central administration was
removed from the Ministry of Post and Transport and converted into an independent state
enterprise with its own board. The research institute of Televerket, Televerkets
Forsknings institute (TF) was established at that time. Previously, Televerket did not
conduct any in house R&D activities. In 1971-77, the regional division of Televerket was
reorganized. Before it consisted of 12 districts and 150 local administrative units, which
then had been turned into a new structure of 7 tele-regions and 27 tele-areas. A new
reorganization took place, when Norwegian National Parliament in 1985 decided to alter
the organization of Televerket. But it was not until 1988, the decision had been
implemented.

In reality, Televerkets monopoly has been eradicated through these reforms and it paved
the way for more competition in, amongst others, user equipment and cable TV. From
1989, Televerket was also allowed to compete in the market for value added services. In
1994, the Parliament again decided to convert Televerket into a state-owned public
limited company. This took place in November in the same year. In early 1995,
Televerket AS changed its name to Telenor AS, with a new and business oriented
organization structure (Hauknes, & Smith, 2003).

Key Figures

The table below contains pro forma key figures (including Kyivstar) for the fourth
quarter and the full year of 2008, compared to the previous year:

Fourth Quarter Full Year

NOK in Millions Expect Earning Per 2008 2007 2008 2007
Share
Report on Telenor 7

105,021
Revenues 29,925 26,914 111,015

NOK in Millions Expect Earning Per Fourth Quarter Full Year

Share 2008 2007 2008 2007
34.6
EBITDA margin before other income and
33.2 32.8 34.7
expenses (%)

Adjusted operating profit/revenue (%) 18.1 17.7 20.4 19.7

Profit after taxes and non-controlling

2,205 5,869 13,307 18,016
interests

Earnings per share from total operations,

1.33 3.49 7.97 10.72
basic, in NOK

Capex 7,223 7,084 22,699 22,079

Capex excl. licenses and spectrum 6,738 6,672 20,664 21,635

Investments in businesses 169 447 1,866 6,041

Net interest-bearing liabilities 39,289 36,464

Major Shareholdings

As of 1 March 2009

No of % of
Sr. # Shareholder Country
Shares Total
The Government, by the Ministry of Trade a
1 894,683,140 NOR 53.97%
nd Industry
2 Folketrygdfondet 75,036,061 GBR 4.53%
3 JP MORGAN chase bank Nordea Treaty 75,036,061 NOR 4.28%
Report on Telenor 8

Account*
1.67%
4 State Street Bank and Client Omnibus * 27,734,631 USA

No of % of
Sr. # Shareholder Country
Shares Total
5 State Street Bank and A/C Client Fund * 25,181,586 USA 1.52%

6 J.P. Morgan Chase Bank 1449 Euro Pac * 23,488,830 USA 1.42%

7 Bank of New York S/A Mellon Nominee* 23,485,267 USA 1.42%

8 Clearstream Banking CID Dept., Frankfurt* 21,765,966 LUX 1.31%

9 J.P. Morgan Omnibus Lending Account * 17,254,486 GBR 1.04%

10 J.P. Morgan Capital World* 17,049,600 USA 1.03%

11 HSBC Bank PLC S/A RE Gulf 13,392,246 ARE 0.81%

USB (Luxembourg) S.A. Ordinary
12 12,074,830 LUX 0.73%
Account*
13 J.P Morgan Chase Bank Depositary* 11,437,512 USA 0.69%
RBC Dexia Investors Client Treaty
14 10,790,630 GBR 0.65%
Account *
15 Rasmussen Gruppen AS 9,800,000 NOR 0.59%
The Northern Thrust C USL Treaty
16 9,236,998 GBR 0.56%
Account*
Skandinaviska Enskilda A/C Treaty
17 6,885,203 SWE 0.42%
Account*
18 DNB NOR Norge (IV) VPF 6,879,461 NOR 0.41%
Svenska Handelsbanken C/O
19 6,634,263 SWE 0.40%
Handelsbanken AS
20 DNB NOR Bank ASA Egenhandelskonto 6,553,350 NOR 0.40%
1,290,248,1
Total 20 largest 77.82%
23
Others 367,640,723 22.18%
Report on Telenor 9

1,657,888,8
Total shares 100.00%
46
Total number of shareholders: 41,916

* Nominees

Worldwide Coverage

The Telenor Group is committed to engage in the local communities where we operate.
Take a look at our latest initiatives in our operations worldwide.

• Bangladesh
• Denmark
• Hungary
• Malaysia
• Montenegro
• Norway
• Pakistan
• Russia
• Serbia
• Sweden
• Thailand
• Ukraine

Telenor in Pakistan

Telenor Pakistan is 100% owned by Telenor ASA and adds on to its operations in Asia
together with Thailand, Malaysia and Bangladesh.

Telenor Pakistan launched its operations in March 2005 as the single largest direct
European investment in Pakistan, setting precedence for further foreign investments in
the telecom sector. The company has crossed many milestones and grown in a number of
directions, making Telenor Pakistan a leading telecom operator of the country.

They are the fastest growing mobile network in the country, with coverage reaching deep
into many of the remotest areas of Pakistan. In the most difficult terrains of the country,
from the hilly northern areas to the sprawling deserts in the south, at times we are the
only operator connecting the previously unconnected.
Report on Telenor 10

They are keeping ahead by investing heavily in infrastructure expansion. With USD2
billion already invested, they have extended agreements with our vendors for network
expansion and services until 2009. The agreements, with a potential to result in USD750
million worth of orders from Telenor Pakistan, are some of the biggest of their kind in the
industry.

They are spread across Pakistan, creating 2,500 direct and 25,000-plus indirect
employment opportunities. They have a network of 23 company-owned sales and service
centers, more than 200 franchisees and some 100,000 retail outlets.

Telenor ASA is an international provider of high quality telecommunications, data and

media communication services. It ranks as world’s 7th largest mobile operator with a
total of 164 million subscribers in its mobile operations. Telenor Pakistan is 100% owned
by Telenor ASA and adds on to its operations in Asia together with Thailand, Malaysia
and Bangladesh.
Report on Telenor 11

Te le nor at a G l ance
The Telenor Group is a leading provider of telecommunications services worldwide. The
company has a strong footprint in Central Eastern Europe and Asia and a leading Nordic
position in mobile, broadband and TV services.

The Telenor Group is listed on the Oslo Stock Exchange, with headquarters in Oslo,
Norway. Telenor started out as a public company in 1855 and builds on more than 150
years of telecom experience. The company was ranked top performer by the Dow Jones
Sustainability Indexes in 2007 and 2008.

Did you know that...?

• the Telenor Group is currently ranked as the world’s seventh largest mobile
operator (in terms of subscriptions)
• the revenues were NOK 111 billion in 2008
• the Telenor Group has 164 million mobile subscriptions worldwide (2008)
• we have telecom operations in 13 countries

In one day at Telenor...

• 38,800 employees go to work in 13 countries

• an average of 75,000 new customers join us
Report on Telenor 12

Te le nor ’s Por tf oli o

Following are the main business of Telenor.

The Internet

UMTS and Turbo 3G are both relatively new products available in the markets. These
services make it simple, fast and inexpensive for customers to use their mobile phones or
PCs to surf the Internet when they are away from home. 3G brought valuable access to
new fields in densely populated areas with less developed infrastructure – such as
Bangladesh.

TV and Broadcast

At present, the Telenor satellites broadcast around 200 TV channels throughout the Nordic Region,
Central and Eastern Europe. Satellite broadcasting has shaped events over the last two decades and
looks set to continue to have a secure position in the Nordic countries, Central Europe and the Middle
East.

Mobile Phone Services

By the year 2000, the mobile telephone service had become a prominent business area for Telenor and
a basis for the international growth strategy. This strong position was the result of more than 30 years
Report on Telenor 13

of evolution. Cooperation between the Nordic countries to create a common standard resulted in the
Nordic Mobile Telephone (NMT) in 1969. This became the start of prolonged international
collaboration to set the future standards for mobile networks.

O ur Vi s i on
Our Vision is Simple: We’re here to Help

We Exist to help our customers get the full benefit of communication services in there
daily lives.

The key to achieving this vision is a mindset where every one of us works together:
Making it easy to buy and use our services. Delivering on our promises. Being respectful
of differences. Inspiring people to find new ways.

Val ue s
We believe in our values which are as following:

Make it Easy

We're practical. We don't complicate things. Everything we produce should be easy to

understand and use. Because we never forget we're trying to make customers' lives easier.

Keep Promises
Report on Telenor 14

Everything we set out to do should work, or if it doesn't, we're here to help. We're about
delivery, not over promising, actions not words.

Be Inspiring

We are creative. We strive to bring energy to the things we do. Everything we produce
should look good, modern and fresh. We are passionate about our business and
customers.

Be Respectful

We acknowledge and respect local cultures. We do not impose one formula worldwide.
We want to be a part of local communities wherever we operate. We believe loyalty has
to be earned.

M is s i on St ate m e nt
Telenor is a customer focused business mobile service operator/telecommunications
Company that seeks competitive advantage in quality and valued added service in both
prepaid and postpaid categories through state of the art technology. Telenor relies on
building trusting relationships with customers, owners, employees and society in general.

O bje c ti ve s
Following are the major objectives of Telenor:

Objectives 2006-07 2015

ARPU(Average Revenue Per User) $4 $6- $8
Market Share in terms of Subscribers 10% 40%

Market Penetration 9% 30%

Market Share in terms of Revenue 7% 30%
Report on Telenor 15

EBITA(Earning before Interest, Tax 5% – 6% 10%

and amortization)
Unprompted Brand Awareness 20% 90%

C EO and G roup Exe c ut i ve Manage m e nt

The Chief Executive Officer (CEO) is in charge of the day-to-day management of the
Telenor Group. The Group Executive Management consists of heads of key business
areas and functions at Telenor.

Jon Fredrik Baksaas

President and CEO
• Appointed: 21 June 2002
• Stocks: 77 156 as of 18 March 2009
• Options: 330 000 as of 4 August 2008

Sigve Brekke
Executive Vice President and Head of the Telenor Asia operations
• Appointed: 1 September 2008
• Stocks: 10 862 as of 17 February 2009
• Options: 40 000 as of 10 November 2008
Report on Telenor 16

Morten Karlsen Sørby

Executive Vice President and head of the Nordic mobile and fixed network operations of
Telenor
• Appointed: January 2003
• Stocks: 25 345 as of 17 February 2009
• Options: 55 000 as of 4 August 2008

Jan Edvard Thygesen

Executive Vice President and Head of the Central/Eastern European
• Appointed: 1999
• Stocks: 66 403 as of 17 February 2009
• Options: 205 000 as of 4 August 2008

Trond O. Westlie
Executive Vice President and Chief Financial Officer (CFO)
• Appointed: 2006
• Stocks: 28 530 as of 17 February 2009
• Options: 55 000 as of 4 August 2008

Bjorn Magnus Kopperud

Executive Vice President and Head of Group Human Resources
• Appointed: January 2006. Since 2003 he has served as Head of Group Human
Resources.
• Stocks: 13 014 as of 17 February 2009
• Options: 90 000 as of 4 August 2008

Ragnar H. Korsæth
Executive Vice President and Head of Global Coordination
• Appointed: January 2006
• Stocks: 8 349 as of 17 February 2009
Report on Telenor 17

• Options: 83 333 as of 4 August 2008

Hilde M. Tonne
Executive Vice President and Head of Communications & Corporate Responsibility
• Appointed: 1 September 2007
• Stocks: 8 007 as of 17 February 2009
• Options: 0 as of 20 February 2009

Boar d of Di re c t or s
The Board is responsible for the management of the Telenor Group and the proper
organization of its operations.
Harald Norvik
Chairman
• Appointed: 31 May 2007
• Stocks: 16 520 as of 10 November 2008

Bjørg Ven
Vice-Chairman
• Appointed: 1 October 2001
• Stocks: 10 000 as of 31 December 2007

Burckhard Bergmann
Board member
• Appointed: 29 May 2008
Report on Telenor 18

• Stocks: 0 as of 20 February 2009

John Giverholt
Board member
• Appointed: 8 May 2003
• Stocks: 0 as of 20 February 2009
.
Kjersti Kleven
Board member
• Appointed: 31 May 2007
• Stocks: 0 as of 20 February 2009

Olav Volldal
Board member
• Appointed: 31 May 2007
• Stocks: 0 as of 20 February 2009

Liselott Kilaas
Board member
• Appointed: 8 May 2003
• Stocks: 0 as of 20 February 2009

Paul Bergqvist
Board member
• Appointed: 7 April 2005
• Stocks: 1 000 as of 15 February 2008

Harald Stavn
Board member, employee representative
• Appointed: 20 June 2000
• Stocks: 4 970 as of 10 November 2008
Report on Telenor 19

May Krosby
Board member, employee representative
• Appointed: 23 August 2007
• Stocks: 0 as of 20 February 2009

Bjorn Andre Anderssen

Board member, employee representative
• Appointed: 23 August 2007
• Stocks: 1 324 as of 17 February 2009
Report on Telenor 20

Prod uct s and Se r vi c es

The Telenor Group provides a wide range of innovative services that are available
throughout the world. Here is a selection.

Mobile Fun

Following are the mobile fun service of Telenor.

Mobile Sports

And he scores!!! You just got a text message alerting you about a
sportive highlight. Luckily you don’t have to wait until you get
home to watch that winning moment – you can watch it directly on
your mobile.

Available in: Norway, Sweden, Pakistan, Thailand, Bangladesh, and Malaysia

Mobile Music

Right now there are 1 million songs ready to download to your

mobile. You can share these digital rights management-free songs
with your friends and family or transfer them to your mobile
phone, mp3 player and PC. Share that funky music!

Available in: Norway, Sweden, Serbia Pakistan, and Malaysia

Mobile TV

Keep your favorite TV shows available in your pocket and watch

them anytime, anywhere. You can easily access live TV channels
on the move so you don’t have to miss out on any of the action.
Keep yourself updated on news, sports, entertainment and more,
directly on your own mobile phone.

Available in: Norway, Sweden, Pakistan, and Malaysia

Mobile Communities

Get out and about, and stay connected and in touch with your
friends. With Telenor you can access communities such as
Report on Telenor 21

Windows Live MSN and Facebook on your mobile and keep your friends close anytime,
anywhere.

Available in: Norway, Sweden

Mobile Interaction

Following are mobile interaction services providing by Telenor.

Community Information Centers

500 Community Information Centers (CICs) offer high speed

Internet access to rural areas in Bangladesh, where the nearest
Internet facilities would otherwise be at least 20-30 miles away.
The service was set up by Telenor's Bangladeshi mobile operator
Grameenphone.

Available in: Bangladesh

Health Line

Health Line provides 24/7 access to medical services for mobile

users in remote areas, several miles from the nearest doctor. All
Grameenphone subscribers in Bangladesh can get medical
assistance directly over the phone.

Available in: Bangladesh

ApnaPCO - Share a Mobile

Can you imagine life without a phone – at all? That is the case for many
people living in some of the most rural communities in Pakistan.
ApnaPCO is a business-in-a-box solution, which allows people in
remote areas to share a mobile phone where there are no other
alternatives – making life a little easier.

Can you imagine life without a phone – at all? That is the case for many
people living in some of the most rural communities in Pakistan.
ApnaPCO is a business-in-a-box solution, which allows people in remote areas to share a
mobile phone where there are no other alternatives – making life a little easier.

Available in: Pakistan

Report on Telenor 22

TeleDoctors

Are you a Telenor Pakistan subscriber and in need of expert medical

advice? Simply dial 1911 to get in touch with experienced doctors who
can help you with your problems – wherever you are in the country.

Available in: Pakistan

Mobile in Flight

By using AeroMobile secure mobile communication technology you

can now call your colleagues, customers, friends and family whilst in
flight from your own mobile phone.

Available in: Worldwide

Mobile at Sea

Most people have experienced little or no connectivity at sea.

Maritime Communications Partner enables mobile phone coverage by
installing and operating the ship borne radio networks, linking the
vessels with public networks via satellite.

Available in: Worldwide

Mobile Marketing

Register your phone number with your favorite shops and services,
and receive sms’s with up to the minute information on the latest
events and offers. Don’t get first in line, avoid the queue altogether!

Available in: Norway, Sweden

Child Internet Protection

The Security Shield technology offered by Telenor protects children

from accessing sites that have not previously been approved or from
Report on Telenor 23

coming into contact with unsuitable people on the Internet. Children have their own login
with a protected desktop controlled by parents.

Available in: Norway, Sweden

Mobile Commerce

Mobile commerce services of Telenor are as follow:

Child Sexual Abuse Filter

In areas with limited access to regular banking services and the

Internet, people can use their mobile phones to transfer money –
anywhere, anytime. The easy accessibility of the service will bring
new opportunities to DiGi subscribers with insufficient access to
regular banking services.

Available in: Malaysia

CellBazaar - Marketplace in Your Pocket

Using CellBazaar, buyers and sellers in Bangladesh can trade basic

goods from their mobile phones, bringing the benefits of information
exchange, community networking and one-to-many trading to a
previously unwired rural population.

Available in: Bangladesh

BillPay - Pay by Phone

BillPay is an innovative service, the first of its kind in Bangladesh. It

provides an electronic bill payment service for utilities services and for
other companies. Customers can pay their utility bills and other bills
through this service regardless of whether they own a mobile
connection or not.

Available in: Bangladesh

Report on Telenor 24

Re s e arc h - t he Fut ure is No w

Working with academic and industrial partners worldwide, Telenor is constantly
developing, testing and demonstrating new mobile services and technology solutions.

The Telenor Research & Innovation unit is an innovation hub for the Telenor Group. With
three locations in Norway and a satellite in Kuala Lumpur, Malaysia, Telenor R&I
employ 236 people from 23 countries.

Our main research areas are:

Wireless Broadband FutureSIM

Connected Objects Content and Services

Report on Telenor 25

Profitability in Emerging

M ark et Se gm e nt at i on and Pos i ti oni ng

Segmentation is the process of dividing the total market for a good or service into several
smaller, internally homogenous groups. Since Telenor is a customer oriented and quality
driven company, it segments its market on the basis of various different dimensions.

• Market dominated by low-end, low-ARPU customers (largely Untapped)

• Relatively large emerging middle class segment (Basic in Telenor Terminology)
• Strong youth culture with needs similar to other markets.
• Private postpaid almost non-existent.
• Small but profitable (high ARPU) Corporate/SME segment.
• Women a largely untapped segment.

Market Segmentation & Product Positioning

Market Segment Today Feature Year Existing Product Profitability

Estimate
Youth/ Students 25% 27% Djuice, TalkShawk 29%
Report on Telenor 26

Women 10% 20% TalkShawk 21%

Financially 40% 23% TalkShawk, Telenor 20%

Constraint Azadi
Corporate/ SME 25% 30% Postpaid Packages 30%

SWO T Anal ys is
An overall evaluation of Telenor’s Strengths (S) Weakness (W) Opportunities (O) and
Threats (T) are as follow:

Strengths

• Network quality & design

• Superior customer care
• Financial Strength
• Excellent Coverage & Distribution.
• Commercial Launch of LDI & mobile services
• Contract with Siemens & Nokia
• Brand image of Quality
• PTA initiatives
• E-commerce usage.

Weaknesses
Report on Telenor 27

• Relatively low market share

• Low profit margins
• Negative cash flows in the initial years

Opportunities

• Favorable Macroeconomic indicators

• low cellular market penetration
• Inefficiency & poor performance of other mobile networks
• Co branding e.g. Ufone with ABN AMRO
• Strategic Alliances & Infrastructure Sharing Facilities
• International Mobile Equipment Identity System

Threats

• Rolling Customers
• Privatizations & deregulations- increased competitions.
• Grey Traffic
• MNP mobile number portability
• Wireless technology at boom
• Public pay phones & calling cards usage where network is not available
• Propagandas attacking brand image

Tel enor  G r oup  St r at egy

The Telenor Group has a strong track record of delivering on ambitious goals. By 2011,
we aim to be one of the fastest growing mobile operators in the world, with a strong
broadband position in all markets, successfully developing new services and adopting
new and responsible business models.

The Telenor Group has defined six strategic ambitions which it aims to achieve by 2011.
These are:

To deliver increased profitable growth

Report on Telenor 28

The Telenor Group aims to achieve a substantial revenue increase in the years to come.
This growth will mainly come from existing businesses. We will seek to increase our core
mobile and fixed voice revenues and explore broadband opportunities in our emerging
markets. The Telenor Group is also investing in adjacent markets, such as basic financial
services and machine-to-machine (M2M) communication worldwide.

To strengthen our performance culture across the Group

In all our operating companies, we will continue the successful practice of combining a
local approach with global expertise. This means that the local management teams will
build a unique performance culture based on their own initiatives and in line with the
Telenor governance model, Codes of Conduct, vision and values, our people policy and
the way we work across borders. In terms of Health, Safety and Environment (HSE), our
objective is to improve working conditions and environmental management by having
clearly defined standards across our operating companies and supply chains.

To make responsible business a competitive advantage

Corporate responsibility at Telenor will be part of managing risk and linked to our core
business. For example, the measures we have taken to fight climate change are motivated
both by our commitment to corporate responsibility and by an enlightened view of
associated business benefits and opportunities: what is good for the environment is also
good for business. Telenor now has clearly defined targets on CO2 emissions from its
operations - not just to help save our planet, but to save energy and money. Telenor has a
strong track record when it comes to sustainable business: it was ranked top performer by
the Dow Jones Sustainability Indexes (DJSI) in 2007 and 2008.

To provide a superior customer experience

Faced with an increasingly competitive environment, Telenor needs to differentiate itself

by providing a superior customer experience. In our vision – we’re here to help – and
core values (make it easy, keep promises, be inspiring, be respectful), we put customer
experience at the top of the agenda throughout the Telenor Group. One of our ambitions
is to reach a situation where end-users’ brand preference is higher than the Telenor market
share for all operating companies.

To ensure best practice benchmarking across the Group

Report on Telenor 29

Telenor will undertake benchmarking and best practice sharing across the Group. A
global objective is to achieve a higher reduction in the average operational cost per
minute than the expected decline in average price per minute. The Telenor Group aims to
achieve considerable continued growth in operating cash flow from all of its operations.

To drive change and constant renewal

To secure a strong industry position, we need to innovate in everything we do. To get the
most out of our efforts, we have prioritized five group-wide innovation areas:

• Broadband outside the Nordic countries. Our long-term ambition is to achieve the
same position in broadband (mobile and fixed) as we have in mobile voice today.
• Connected objects / M2M. The “Internet of things.” The Telenor Group is
working to establish itself as a global player within this rapidly growing and
potentially huge market.
• Financial services. The Telenor Group aims to establish itself as a significant
player in parts of the financial services industry in select under-serviced markets,
establishing a platform for long-term growth.
• Partner innovation. The Telenor Group controls many valuable assets that can be
further developed together with partners. Partner-driven innovation is a cost-
effective way to create many new revenue-generating services.
• Climate change. Our number one priority is to reduce CO2 emissions. The
Telenor Group aims to be part of the climate solution by de-carbonizing business
processes and reducing physical travel and transport.

Improving our performance management

The Telenor Group aims to create a stronger link between the strategy process and
performance monitoring. All operating companies will implement a new and improved
management model where strategic objectives and ambitions are monitored closely at
both the company level and the lower department level.

Challenges ahead

The global telecom industry is still growing and generating large profits. Looking ahead,
we expect usage of mobile and fixed voice communications to grow significantly.
Broadband also represents a huge growth opportunity. However, there are challenging
trends, e.g. maturing markets, financial instability, pricing pressures as well as regulatory
issues. Still, well-positioned players will benefit from market growth and increased
efficiency, enabling significant cash flows in the future.
Report on Telenor 30

St r at e gi c Pl anni ng Proce s s (Marketing Mix)

According to Bearden (2001), Strategic planning requires a nice combination of strategies
with products and other corporate resources. It requires the involvement of fair execution
Report on Telenor 31

of strategically plan from different functions like marketing, production, finance,

distribution and others. For strategy formulation, there is a variety of decisions which
should be there before its implementation. Where right entry mode strategy is necessary,
there is also a need of appropriate product-market combination. Then other marketing
mix elements should be given importance because these elements can be the backbone
for the business success

Telenor’s product Strategy

To get the real fruits of more open market at regional level requires the satisfaction of the
demands of the target market and this satisfaction can only be achieved if the product or
service offered in the market is suitable and acceptable for its purpose and this can be
obtained by adopting a regional product strategy suitable for company and the market as
well.

Telenor’s study indicates that it is acting quite on this concept that, in order to be more
competitive in the world market, firms should shift their emphasis from local customized
products to globally standardized products that are advanced, functional, reliable and low
priced. But here low priced strategy be to compromise and later on due to its quality,
Telenor’s low price strategy takes shift from low to high but competitive.

Buzzel (1968) argued that product standardization has different benefits (a) economies of
scale, (b) faster accumulation of learning experience and (c) reduced costs of design
modification. In the regional open market, Telenor is taking the fruit of this by adopting
the product standardization but the situation can be different in other markets. The
company used a multi domestic strategy to gain competitive advantage in its target
markets. A key factor in the strategy is the encouragement of senior managers to be
entrepreneurial in responding to local customer needs, product quality and customer
services.

Telenor’s decision to standardize or adapt its products is based on cost/benefit analysis of

what they believe the implications of adaptation and standardization are for profitability
and market share. According to Doole (2000) in normal circumstances, the cost of
adaptation would be expected to be greater than the cost of successful standardization.
Telenor believes in long term advantages and not in satisfaction of immediate demand,
that’s why they continue the exposure to the standardized products and services which
leads them to greater market share in the longer term.

Our research shows that there are three factors which enforced the company towards
more standardized strategy and these are illustrated in figure below.

• Homogeneity of markets
Report on Telenor 32

• Increase in number of regionalizing firms

• Identifiable international consumer segments

Summarizing it, regionalization forced the company to rethink about its strategies
towards product, to be more competitive in the open market.

Telenor’s Price Strategy

Pricing across the borders is comparatively difficult from other decisions though it is
believed that pricing is the most flexible and controllable marketing mix element.
Companies operating in different markets experience extraordinarily difference across the
borders. This can be due to the exchange rate difference and other barriers. But in our
study, this matter is not much sensitive because of psychic distance factor. Cultural
environment and a geographical neighborhood influence the pricing policy of Telenor. On
the other hand, being a non member of European Union, it can be totally opposite of the
general strategies adopted by the companies located in European Union.

Telenor’s pricing policy is influenced by different factors among them five are much
important and they are indicated below:

• Market survival
• Sales growth
• Market position
• Maximization of Profits
• Maintenance of product’s quality

Though lower price is considered a suitable policy but in case of Telenor, it is affected
due to regionalization but not so much but competition factor is given special
consideration before development of price strategy. That’s why Telenor has high price
strategy due to high quality products and services but at certain level penetration price
strategy is adopted to stimulate sales growth.

Here, at this aspect if we talk about the standardization or adaptation strategy of pricing,
Telenor follows adaptation policy as well because it allows each local subsidiary or
partner to set a price which is considered to be the most suitable for local conditions. On
the other hand, lack of control can be the weakness of this strategy and it may require
some cost for management.
Report on Telenor 33

Telenor’s Place Strategy

To manage the foreign channels of distribution is a key area in a company’s efforts to be

more competitive in the market. According to (Doole, 2001), as products become more
standardized across the world, the ability to compete on customer becomes more vital.

Channels of distributions developed by Telenor follow the cultural traditions of the target
market because it is important to understand and manage cultural differences amongst
different markets and Telenor has deep analysis of the markets before developing its
positioning strategy because cultural differences add to control difficulties. In regional
marketing, Telenor is taking advantages of his heavy infrastructural products and its
financial worth. In our study, we found that company is adopting those strategies which
are not used by the others commonly. To make a huge as well as direct investment in the
form of acquisitions and wholly owned subsidiaries is high risky but more profitable
decision for Telenor.

Open borders give a number of alternatives for position the products and Telenor is using
different distribution channels which vary from market to market and country to country.
As Telenor is involved in telecommunication business so usually it doesn’t involve in
physical distribution but it has the partnership strategy and on the local level, shops and
customer care centers are used as place strategy.

Telenor’s Promotional Strategy

It is quite obvious from the business environment, that there is a rapid increase in
competition and markets became mature at the regional level. These factors demand the
companies to offer high quality products and services at competitive price level through
suitable distribution channel. In addition to its traditional role of promoting products and
services, international marketing communications is increasingly used to facilitate the
company with an important way of differentiation in open internal market.

According to our findings, there are a variety of promotional tools which are used by
Telenor to inform and motivate its valuable consumers in the regional market. The
company developed a standardized promotional package which is sufficiently flexible
with the different ways in different cultures and norms. Besides it, that package is also
flexible in such a way, in which subsidiaries can develop their own marketing positioning
and related promotional strategy.

During our study of Telenor as a regional company, we found that the company builds up
its promotional strategies with two basic issues. First, the company should have the clear
Report on Telenor 34

picture of the objectives for regional marketing communication strategy and, second is,
how the company can combine the different promotional tools and activities for the
higher level of cost effectiveness. On the other hand Telenor’s regional marketing
communication strategy can be adapted because the market structures and distribution
channels can be different from market to market and country to country. However, mostly
these factors are not those, which can said to be crucial for the company like Telenor.

Summarizing it, regionalization factor has influenced the Telenor’s promotional part of
marketing mix but in all the way it has positive edge for the company and its business
throughout the region.
Report on Telenor 35

Com pe ti t i on
As at 30 June 2008, Telenor Pakistan had a market share of approximately 20%. In
addition to Telenor Pakistan, there are five other mobile operators in Pakistan: Mobilink,
Ufone, Warid, Zong (formerly Paktel) and Instaphone. According to data provided by the
Pakistan Telecommunication Authority (the PTA), as at 30 June 2008 Mobilink was the
largest cellular mobile operator in Pakistan with a market share of approximately 37%,
Ufone had a market share of approximately 20%, Warid had a market share of
approximately 17%, Zong had a market share of approximately 4%, and Instaphone had a
market share of approximately 0.4%.

Major Competitor

Parameters Mobilink Telenor

Product Life Cycle Maturity Growth
Market share % 37% 20%
Coverage 900 cities 1100 cities
Jazz Octane,
Mobilink TalkShawk, Telenor
Product Portfolio
Indigo, LadiesAzadi, Djuice
First,
Customer Base 17.2 million 3.6 million
Marketing Operations Excellent Good
Report on Telenor 36

Conc l us i on
Telenor is the leading telecommunication company, which are the most advanced
telecommunication markets in the world. The Telenor Group is committed to engage in
the local communities where it operates.

In Pakistan telenor launched its operations in March 2005 as the single largest direct
European investment in Pakistan. The company has crossed many milestones and grown
in a number of directions, making Telenor Pakistan a leading telecom operator of the
country. They are providing a service in almost 2500 cites of Pakistan and it is most
growing telecom industry in this country.

In short it start its business when there is a very high competition in market and take very
little time to grow in the market and now it has almost 20% market share in Pakistan and
standing at second place along with Ufone who also has 20%. They are now providing
different services to its customers at a high quality which helps them to progress rapidly
in country and in features their objectives shows that in next few years the will become
the market leaders in Pakistan.
Report on Telenor 37

Sugge s t i on:

Key Issues:

• Issue 1:
Maintain network quality

• Issue 2:
Low market penetration

• Issue 3:
Rolling Customers

• Issue 4:
Untapped market segments- Women

• Issue 5:
Mobile number portability

• Issue 6:
Documentation to avoid mischievous

• Issue 7:
Should be low price

• Issue 8:
Maintain Customer Relationship Management

Strategic Direction

• Building an organization with competency, capabilities and resource strengths

• Developing Technical Know How in Employees

• Developing budgets to steer ample resources into critical value chain activities

• Creating strategy supportive policies and procedures

Report on Telenor 38

• Instituting best practices and a commitment to continuous improvement

• Installing support systems and Value added Services

• Maintain low cost

Re f e re nce s :
Principles of Marketing by Philip Kotler,

Telenor Broadcast Report - 2008-09 as on 11th of February 2009

Interim Report January–December 2008

Corporate Responsibility Report 2008

Telenor Cantt Franchises

www. Telenor.com.pk

www.researchandmarkets.com/reports

www.telenor.com.pk
Report on Telenor 39