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PAKISTAN TELECOMMUNICATION CORPORATION LIMITED

OWNERS

SOEs 62%

Etisalat 26%

Public 12%

REVENUE U.S. $1.24 billion (2012-13)

NET PROFIT U.S. $155.2 million (2013)

PRODUCTS/SERVICES

Voice & Broadband

Enterprise & Intl. Business

Carrier & Wholesale

SUBSIDIARY

Ufone

U Microfinance Bank (UBank)

Pakistan Telecommunication Company Limited (PTCL) is a mega-corporation and a leading telecommunication

authority in Pakistan. The corporation provides telephonic and internet services nation-wide and is the backbone

for country's telecommunication infrastructure despite arrival of a dozen other telecommunication corporations,

including Telenor Corps and China Mobile Ltd. The corporation manages and operates around ~2000 telephone

exchanges across the country, providing the largest fixed line network. Data and backbone services such as GSM,

CDMA, Broadband Internet, and IPTV, wholesale are an increasing part of its business.

Originally one of the state-owned corporations (SOEs), the shareholding of the PTCL has been reduced to ~62%,

when 26% of shares and control was sold to Etisalat Telecommunications and the remaining 12% to the general

public in 2006 under an intensified privatization programme of Prime minister Shaukat Aziz. However, the 62%

shares are still remains under the management of government-ownership of state-owned corporations (SOEs) of

Pakistan.

General Information

Founded on 14th August 1947

Type Public

Traded as PTC

Industry Telecommunication

Headquarter Islamabad, Pakistan

Website www.ptcl.com.pk Total Employees

30,000

Vision To be the leading Information and Communication Technology Service Provider in the region by achieving customer satisfaction and maximizing shareholders' value'.

Mission Statement To achieve our vision by having:

An organizational environment that fosters professionalism, motivation and quality An environment that is cost effective and quality conscious Services that are based on the most optimum technology "Quality" and "Time" conscious customer service Sustained growth in earnings and profitability

Key Players

Walid Irshaid President & CEO

Akhlaq Ahmad Tarar Chairman

Muhammad Nehmatullah Toor SEVP (Finance) / CFO

C O R P O R A T E H E A D Q U A R T E R S , B L O C K - E , G - 8 / 4 , I S L A M A B A D - 4 4 0 0 0 , P A K I S T A N .

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Table of Content

1 External Environment .......................................................................................................................................................................................................... 5

1.1 Industry Analysis .......................................................................................................................................................................................................... 5

1.1.1 Dominant Characteristics .................................................................................................................................................................................... 5

1.1.2 Forces of Change ................................................................................................................................................................................................. 5

1.1.3 Key survival factors / Attractiveness ................................................................................................................................................................... 5

1.2 Situational Analysis ...................................................................................................................................................................................................... 6

1.3 Competitor Environment ............................................................................................................................................................................................. 7

1.3.1 Major Competitors .............................................................................................................................................................................................. 7

1.3.2 Competitive Edge ................................................................................................................................................................................................. 7

2 Internal Environment........................................................................................................................................................................................................... 8

2.1 Core Competences ...................................................................................................................................................................................................... 8

2.2 Distinctive Competencies ............................................................................................................................................................................................ 8

2.3 Financial Situation ....................................................................................................................................................................................................... 9

2.4 SWOT Analysis ........................................................................................................................................................................................................... 11

2.5 Challenges .................................................................................................................................................................................................................. 12

2.6 Goals .......................................................................................................................................................................................................................... 12

3 Strategic Recommendations.............................................................................................................................................................................................. 12

3.1 Corporate level .......................................................................................................................................................................................................... 12

3.2 Business Level ............................................................................................................................................................................................................ 13

4 Reference ........................................................................................................................................................................................................................... 14

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1 External Environment

1.1 Industry Analysis

1.1.1 Dominant Characteristics

Header

Market size PTCL has more than 95% share in the FLL subscriber base while in the WLL sector, it holds close to 37% of the market share, according to PTA Annual Report 2013.

Life cycle stage Rapid Growth because of continuous innovation in products for domestic consumers and enterprises

Potential to grow Being the market leader still there are untapped areas which need to be tapped.

Growth rate 31% according to the PTCL 3rd quarterly report.

Rivals scope Very marginal comparing to new products introduced by PTCL

Vertical integration PTCL has acquired 100% ownership of Rozgar Microfinance Bank Limited. The acquisition is in line with PTCL Group’s initiative on Digital-Commerce.

Industry change PTCL is updating itself with latest technology to provide fast, reliable and smooth services to its domestic and corporate users.

Product/service differentiation The services and products are more or less same but the quality of services and support time is better than others.

Economy of scale PTCL is providing services at economy of scale; therefore it is very difficult to compete with it.

Barriers to entry The entry cost is too high that only few players can enter and sustain in the market. The entry cost in terms of equipment, skilled people, and supplier is too high that PTCL has no threat from new competitor. PTCL has established its brand value through its huge product line.

1.1.2 Forces of Change

1. If Competitors make an alliance against PTCL.

2. If PTA introduce any regulation, which not align with the corporate goal of PTCL.

3. If deadlock occur on the longstanding issues between the Government of Pakistan and Etisalat Management.

1.1.3 Key survival factors / Attractiveness

1. Being the only Fixed line provider, PTCL ensure its existence in the country

2. More than 1.1 million broadband, 0.67 million EVO-3G users

3. Devoted and enthusiastic Team

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4. Up-to the mark infrastructure to support 3G/4G requirements in future

5. Providing services to domestic customers at lowest possible charges

6. One wire to satisfy all communicational and information needs (domestic users)

7. Providing various solutions for S.M.E companies

1.2 Situational Analysis

External Environment F=Favorable UF=Unfavorable

Porter’s Five Forces

S=Strong M=Medium

W=Weak Social/cultural F Buyers W

Demographic Trends F Suppliers S

Economic Trends F Rivals W

Political/Legal F Substitutes M

Technology Trends F Threat of new entrants W

Global F

Overall general environ. F Overall Competitive environ. M

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1.3 Competitor Environment

1.3.1 Major Competitors

Companies Broadband Voice Carrier & Wholesale

Services

Corporate Services

Wi-tribe Y Y

Qubee Y Y

Wateen Y Y Y Y

Cybernet Y Y

Worldcall Y Y Y

TW1 Y Y

Multinet Y Y

Supernet Y Y

Mobilinkinfinity Y Y

1.3.2 Competitive Edge

1. Telecommunication infrastructure is spread out countrywide

2. The only company providing landline phone connection

3. PTCL spend good amount on marketing and advertising

4. Large product portfolio other than fixed line and DSL

5. PTCL is part of four largest international cable consortium systems SMW3, SMW4, IMEWE and recently signed AAE-1 which act as a

gateway for Pakistan to the information superhighway1.

1 http://www.ptcl.com.pk/press_release_detail.php?pd_id=69&pr_id=394

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2 Internal Environment

2.1 Core Competences 1. Infrastructure deployment and network management across country

2. State-of-the-art customer service network

3. PTCL has laid Optical Fiber Access Network in the major metropolitan centers of Pakistan and local loop services have started to be

modernized and upgraded from copper to an optical network

4. PTCL has heavily invested in undersea submarines cable systems with other leading telecom providers

2.2 Distinctive Competencies 1. Introduction of PTCL Public Cash Payment Machines – a self-service mechanism to pay all type of PTCL bills

2. The launch of Interactive Television Service – PTCL Smart TV first time in Pakistan in 2008

3. PTCL enable its customers to create 3G Wi-Fi Cloud, allow 5 gadgets to connect instantly

4. Customer can pay, update or restore their accounts from 43,490 locations nationwide

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2.3 Financial Situation

*the financial is extract from Annual Report 201

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2.4 SWOT Analysis S W O T

1. State of the art customer relationship management system 2. Market leader in DSL Broadband Service covering 1800 cities &

town 3. Evo Wireless Service is offering in 2500 Cities 4. Dynamic and Efficient Marketing and Sales teams 5. Only provider for landline telephone services 6. OSS(One Stop Shop) facilitating customers with all

product/services under one roof 7. Establish successfully brand loyalty

1. Last mile infrastructure not as per the current technologies

need 2. lower level employees are involved in corruption 3. Image – Government organization 4. Lack of Corporate culture 5. Lack of Customer service

1. Market open for new products and customers 2. The pioneers of 3G/4G services in the country, market share will

be increase in future 3. Increase brand value through CSR Programme 4. Acquisition of Warid Telecom 5. New subscribers join the PTCL network

1. DNOPs offering services over improved last mile

infrastructure 2. With the offering of 3G services, the demand of telephone

line at household level will might be decrease 3. Alliance of competitors 4. If PTA suspend the PTCL Licenses 5. Migration of fixed line users to other cellular network

(excluding ufone) 6. Rapid increase in taxes might reduce the company profit 7. Political instability

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2.5 Challenges 1. To retain the customers with the 100% satisfaction

2. To provide best services at possible low rates

3. To overcome the corruption at every level and provide state of the art services to customers

4. To bring back those customers which switched to other networks

5. To create brand loyalty

6. To spread awareness of products offering under one umbrella

2.6 Goals 1. Expand the service of Smart TV to all over Pakistan – currently providing the IPTV service only 50 cities

2. PTCL is ready to launch 4G enable devices – waiting for license release

3. Provide high speed internet at possible low price

4. PTCL in near future offering Hosted Business Application (like SAP/CRM, Siebel, Oracle, Contact Center) as part of their corporate

solution

3 Strategic Recommendations

3.1 Corporate level 1. Improve organizational culture despite of a private organization now, still PTCL act like a government organization.

2. Improve the overall response time against complain, PTCL has too establish a mechanism through which users can gets their 1st level of

trouble shooting support on their first call.

3. It is necessary to minimize billing errors.

4. The OSS (One Stop Shop) is a good initiative but the environment and customer support still need perfection.

5. People are not aware of product lines and various services which PTCL is offering, to remain the market leader PTCL has to be more

visible and at the same time easily accessible to its potential customers.

6. PTCL need to be innovative in its product and services offering to its domestic and corporate customers.

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3.2 Business Level Overall Analysis (scale of 0 to 10)

Innovation

Structure

FinancialsProduct

People

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4 Reference 1. http://www.dailytimes.com.pk/business/04-Feb-2014/ptcl-posts-record-revenue-of-rs-131-2bn-for-fy13

2. http://en.wikipedia.org/wiki/Pakistan_Telecommunication_Company_Ltd

3. http://www.ptcl.com.pk

4. http://propakistani.pk/2014/01/07/pta-suspends-ptcls-wll-evo-license/

5. http://www.dailytimes.com.pk/business/21-Dec-2013/ptcl-submits-binding-offer-to-acquire-warid