Word: telenor
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Dates: during 2000-2009
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Drawn by the potential for rapid growth in some of Asia's younger cell-phone markets, Telenor has been expanding in the region for more than a decade. The company now has 50 million subscribers in Asia, 17 times its number in Norway. The area now accounts for some 30% of Telenor's $17 billion in annual revenues, and will generate 36% in a couple of years, according to estimates by investment bank Dresdner Kleinwort. Asia, says Arild Nysaether, telecoms analyst at investment bank Fondsfinans in Oslo, is simply "the most important part of Telenor." And it's a point...
...liberalization of Europe's telecom markets in the late '90s that forced Telenor abroad, in search of growth to offset stiffening domestic competition. But squared up against the region's big boys - Telefónica, say, or Deutsche Telekom - Telenor was too small to make much headway in established European markets. It "never had the firepower to go for scale in Europe along the lines pursued by others," says Martin Mabbutt, telecoms analyst at financial services group Nomura in London...
What it did have, though, was experience. Telenor adopted gsm - the global standard for digital mobile telecoms - as early as 1993, and had pioneered gsm's precursor more than a decade earlier. By the late '90s, mobile-phone penetration levels in Norway were more than double those in France and Germany, according to telecom consultancy Analysys. In light of deregulation, Telenor's savvy for nurturing a customer base from the early stages to maturity looked like its strongest export...
Asia's less developed cell-phone markets soon became targets. The company launched into Bangladesh's fledgling sector in 1997 convinced, says Jon Fredrik Baksaas, Telenor's CEO, that "mobile communications are as important in this kind of society as in Scandinavia." Once Grameenphone, its business in Bangladesh, was up and running, Telenor sought fresh openings in markets offering rapid growth, and gradually accrued controlling stakes in local Thai and Malaysian operators. When Pakistan invited bids for a license to operate from 2005, Telenor jumped at the chance...
...expansion policies go, it was opportunistic. "From the beginning, we didn't necessarily look to those four countries that we have today," says Baksaas. But there's no denying it's been fruitful. "Telenor has developed one of the best portfolios of international assets" of all Europe's major telecom firms, analysts at Citigroup wrote in a recent note. Since Telenor took control of Malaysian operator DiGi in 2001, for example, that business has expanded "from a small, niche player to one of the driving forces in the market," says Espen Torgersen, telecoms analyst at Carnegie, a Nordic investment bank...