Wateen Telecom, the largest WiMax operator in Pakistan has stopped selling new connections and instead opted to retain its old customers who are churning out consistently since the re-launch of company in November 2011.
In December 2011 Wateen Telecom gathered its Franchisees in Lahore and announced that company will follow customer retention policy instead of going for new customers. In compliance with its decision, Wateen stopped issuing new Consumer Premises Equipment (CPE) / Modems to its franchises all over the country.
According to sources, higher management announced this policy owing to lack of funds for the purchase of new equipment.
As per retention policy, entire sales force including the franchises have been assigned the task to recover the old equipment from the default customers so that if a new customer plans to join Wateen network, he/she could be provided with a WiMax modem. In April 2012, management communicated to its sales force that apart from indoor modems, outdoor customer equipment was also not available for facilitating the customers.
As a result of recent policies and weak customer services, many of Wateen customers churned out and opted for other broadband services.
Wateen officially claims that it has 300,000 WiMax customers all over the country whereas sources reveal that actual active customers on the network are less than 160,000. In Lahore, where company has a massive coverage, 35,000 WiMax customers are active.
“As a regular business practice, a franchise gets Rs. 1,000 to Rs. 1,400 in terms of commission on every new connection sold depending upon the value of connection and nature of package. Since Wateen has stopped providing equipment for new connections, the business plan of all Wateen franchises have collapsed. Contrary to our agreements with the company, we are only entitled to receive Rs. 270 against every equipment that we recover from the default customer.”, a Wateen franchise told MORE on the condition of anonymity.
“We have not received sales commission since January 2012 and percentage on recovered equipment is also pending and for this we are told that company does not have extra funds for meeting its liability. After Wateen was re-launched, we invested a good sum of money for buying the stock in good faith but we haven’t yet recovered our basic investment”, added the franchise.
Sources reveal that shortage of funds has reached to a limit where it has started to affect the normal business activities. Even the equipment for certain USF projects are being supplied from the recovered lot of CPEs from default customers.
The new management took over the company in January 2011. It took almost a year in making new strategy when eventually Wateen was re-launched in November 2011. It is out of comprehension that in just 2 months time after reshaping the entire company, Wateen management realized that it was out of stock and short of funds that caused the high ups to tumble and change the whole business plan.
