Costly leased lines hamper Internet<\/p>\n
Leony Aurora, The Jakarta Post, Jakarta<\/p>\n
High prices of leased lines for domestic and international links
\nin Indonesia, which can be up to 48 times more expensive than
\nother countries, is hampering the development of the Internet and
\nshould be regulated, a study shows.<\/p>\n
The annual domestic leased line fee for a two-kilometer link
\nwith a capacity of 2 Megabits per second (Mbps) here is
\nUS$18,000, an overwhelming 48 times more expensive than the $376
\napplied in India, according to a study conducted by LIRNEasia, a
\nregional ICT policy and regulation capacity building
\norganization, in August.<\/p>\n
The Indonesian price is quadruple the price applied in Europe,
\nwhere an average person earns 25 times more than an average
\nIndonesian in a year, said director of organizational development
\nand projects of LIRNEasia Divakar Goswami, who conducted the
\nstudy with Indonesian information and communication technology
\n(ICT) expert Onno Purbo, recently.<\/p>\n
The annual fee for an international link from the country's
\nsecond biggest telecommunication firm PT Indosat of $108,528,
\naccording to the study, compares to $36,868 charged in Denmark
\nand $29,555 in India.<\/p>\n
\"Such high leased line prices result in high Internet prices
\nfor customers, which in turn creates a barrier to rapid Internet
\ndiffusion in Indonesia,\" Goswami said.<\/p>\n
Internet penetration -- measuring the ratio between the number
\nof customers and population -- in Indonesia is estimated to be
\n0.6 percent by the end of this year.<\/p>\n
Indosat president director Hasnul Suhaimi said high leased
\nline prices were the result of not having sufficient numbers of
\nusers. \"We have not reached the economic scale yet for the
\ndevelopment of leased lines,\" he said.<\/p>\n
He added that the international fee had declined by some 50
\npercent in the last four years due to competition with other
\nproviders.<\/p>\n
\"Indonesian prices are going down. It's just that (prices) in
\nother (countries) are falling more rapidly,\" said Hasnul.<\/p>\n
Goswami suggested that the government make a thorough effort
\nto regulate fees for leased lines so that Internet could be
\nprovided more cheaply.<\/p>\n
One obstacle may be that the government controls shares in the
\ncountry's largest telecommunication firm PT Telkom and also
\nIndosat. The supposedly independent Telecommunications Regulatory
\nBody (BRTI) is chaired by the Ministry of Communications and
\nInformation's director general of Post and Telecommunications,
\nBasuki Yusuf Iskandar.<\/p>\n
\"It would be hard for BRTI to make policies that could reduce
\nrevenues for the two companies,\" said Goswami.<\/p>\n
Chairman of the Indonesia Infocom Society (Mastel) Giri Suseno
\nHadihardjono said that in India, such regulations did not put
\ntelecommunication companies out of business -- in fact, they
\ndeveloped instead.<\/p>\n
\"We cannot simply copy (India). We have to take into
\nconsideration the local conditions,\" said Giri. The government,
\nhe said, had to make up its mind on whether the initial decline
\nin revenues caused by the lower prices was worth the boost in
\nInternet usage.<\/p>\n
\"Of course, if it's cheaper, more people will use the
\nInternet,\" he said.<\/p>\n
Indonesia has adopted the United Nations' target to ensure
\nthat 50 percent of the population gets Internet access by the
\nyear 2015.<\/p>\n
Table<\/p>\n
Annual leased line prices in Indonesia and other countries
\n----------------------------------------------------------------
\nDomestic
\n----------------------------------------------------------------
\n2Mbps* link Indonesia India EU benchmark
\n----------------------------------------------------------------
\n2 km $18,000 $ 376 $4,802
\n200 km $45,000 $7,603 $9,219
\n----------------------------------------------------------------
\nInternational
\n----------------------------------------------------------------
\n2 Mbps $108,528 $29,555 $36,868
\n----------------------------------------------------------------
\nMbps: Megabits per second
\nSource: LIRNEasia<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/costly-leased-lines-hamper-internet-1447893297",
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"sponsor": "Okusi Associates",
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