Grameen Bank's Village Phone Initiative: Connecting Rural Bangladesh to the World
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Case Details:
Case Code : ITSY054
Case Length : 14 Pages
Period : 1997-2006
Pub Date : 2006
Teaching Note :Not Available
Organization : Grameen Bank, Grameen Telecom, Grameen Phone
Industry : Telecom and Broadband
Countries : Bangladesh
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This case study was compiled from published sources, and is intended to be used as a basis for class discussion. It is not intended to illustrate either effective or ineffective handling of a management situation. Nor is it a primary information source.
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Excerpts
Background Note
The driving force behind the Grameen Phone program was Iqbal Z Quadir (Quadir). Quadir, who was from Bangladesh, was working in the USA as an investment banker. In 1993, when the phone networks at his office did not function, he remembered the tough time he had had as a child in Bangladesh, due to the absence of modern communication systems...
Balancing Social and Economic Returns
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The equity participation and debt financing by foreign institutions in Grameen Phone meant that the project had to also be economically viable while supporting Grameen Bank's development agenda...
The Village Phone Program
Grameen Telecom intended to provide at least one telephone in each village and thus provide the rural poor access to telephone services. In order to offer these facilities, Grameen Telecom coordinated with Grameen Bank and Grameen Phone to launch the Village Phone...
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Operations of Village Phone
Under the Village Phone program, a VPO was given the ownership of the phone under the lease-financing program of Grameen Bank. The phone was under the custody of the VPO, who extended incoming and outgoing services to the villagers and charged them for these services...
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Revenue Generation
The VPOs, popularly known as Village Phone Ladies, charged for the calls made through the mobile phone. Extra charges were levied for receiving messages from others and for bringing the phone to the receiver...
The Benefits and Challenges
Analysts opined that the Grameen Phone illustrated the fact that developing and under-developed countries need not go through all the phases of telecommunication technology and could adapt to new technology without using the old ones...
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Exhibits
Exhibit I: Grameen Phone Coverage (2005)
Exhibit II: Grameen Phone - Key Financials
Exhibit III: Grameen Telecom - Unit Offices (July 2006)
Exhibit IV: Relationship between Grameen Phone, Grameen Telecom, Grameen Bank
and Village Phone Operators
Exhibit V: Role of Grameen Telecom and Grameen Phone in Village Phone Program
Exhibit VI: Village Phone Operator
Exhibit VII: Cost and Revenue Structure of Village Phone Operator
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