~FOR Telecommunications Day -- May 17<\/p>\n
;JP;CD;
\nANPAf..r..
\nPhones-int'nal-calls<\/p>\n
International calls:
\nCompetition getting tough<\/p>\n
Rudijanto
\nContributor\/Jakarta<\/p>\n
International callers might have gained some benefits of cheaper
\noverseas rates as PT Indosat Tbk (Indosat) and PT Telkom Tbk
\n(Telkom) engage in a tough battle to grab significant market
\nshare, but the public has a legitimate right to expect more
\nbenefits from the competition.<\/p>\n
Unlike in the recent past when they had to rely on Indosat and
\nits newly acquired company Satelindo for overseas calls, nowadays
\ncallers have Telkom International Call (TIC) 007 and Telkom
\nGlobal (TG) 017 and even cellular operators, including Bakrie
\nTelecom E-Asia SLI 1188 and SLI 888 as alternatives.<\/p>\n
As a long-time and still dominant player in overseas call
\nservices, Indosat have to accept the reality that they cannot
\nforce they own terms on consumers like they did in the past
\nwithout risking losing customers.<\/p>\n
The opening up of the market in overseas calls to Telkom has
\nalready eaten into Indosat's market share. The company even
\npredicts that this downward trend in market share will stabilize
\nonly in two years after Telkom's onslaught with its TIC 007 ad TG
\n017.<\/p>\n
\"We believe that the competition will make the market grow
\nthough, currently, the downward movement of market share looks
\nfaster than the growth of market share,\" Indosat's senior vice
\npresident of marketing and sales Bambang Priantono said in an
\ninterview last week.<\/p>\n
As of the end of last year, Indosat's 001 market share dropped
\nto 63 percent, while its second tier long distance service 008
\ndropped to 11 percent.<\/p>\n
Bambang expects the downward trend in Indosat's market share
\nto stabilize in around April 2006. But without good marketing
\nstrategies, the downward trend may continue even longer.<\/p>\n
The strategy includes creating a third tier product to protect
\nIndosat's first and second tiers, namely the premium 001 and
\nsecond line 008. The third tier Indosat 016 is expected able to
\nengage VoIP-based operators, including Telkom's TG 017, in a
\nbudget-conscious market.<\/p>\n
Though applying similar method of channel compression as that
\nof VoIP, Indosat insists that Indosat 016 has a different quality
\nto VoIP since a channel is only shared by four users.<\/p>\n
\"VoIP usually provides one channel that is shared by up to 20
\nusers so that the quality of voice suffers. In our Indosat 016,
\nwe maintain the quality so that the voice is similar to that of
\nthe clear channel,\" Bambang said.<\/p>\n
Telkom itself had set an aggressive target of grabbing 50
\npercent market share of international calls with TIC 007. The
\ncompany even boasted of its international call performance by
\nsaying that barely six months after launching TIC 007, it has
\ngrabbed 25 percent market share.<\/p>\n
\"We are quite optimistic of being able to grab long-distance
\nmarket share, based on our performance since the launching of TIC
\n007 on June 7 of last year,\" said the head of Telkom's long-
\ndistance division Sarwoto.<\/p>\n
Like Indosat's 016, TG 017 also claims to compress the channel
\nby one to four. This means that one channel can only be shared by
\nfour users at the same time.<\/p>\n
\"We manage the bandwidth of TG-017 so that the quality will
\nnot drop and the traffic will not pass by public Internet,\" added
\nSarwoto.<\/p>\n
Having practically similar products, both Indosat and Telecom
\ncan hardly avoid head-to-head competition in the market.
\nAlready, Indosat has accused Telkom of engaging in unfair
\ncompetition.<\/p>\n
Indosat has even reported the alleged blocking of its
\ninternational call service codes, 001 and 008, by Telkom to the
\nCommission for the Supervision of Business Competition (KPPU).<\/p>\n
Though Telkom had previously denied the allegation, the
\ncompany later admitted that it forced its subscribers to make a
\nrequest if they wanted to have access to Indosat's 001 and 008.<\/p>\n
This 'normally closed' policy has made Indosat's 001 and 008
\ndifficult to access from Telkom's fixed lines and Telkom's Telkom
\nKiosks (Wartel).<\/p>\n
Certainly, Telkom feels it has the right to protect its
\nexisting customer base in its nation-wide networks. Having built
\ncostly and vast telecommunications infrastructure, Telkom seemed
\nto consider that Indosat was only taking advantage of the
\nexisting infrastructure.<\/p>\n
The fact is Indosat as a long established player in overseas
\ncall services has not developed infrastructure such as fixed
\nlines like that of Telkom. Indosat only has gateways for its
\noverseas call services.<\/p>\n
Under previous monopoly arrangements that placed Telkom as the
\nonly provider of domestic calls, Indosat as the provider for
\noverseas calls certainly felt no need to develop its own
\ninfrastructure for fixed lines.<\/p>\n
Facing such a tough challenge in the field, Indosat is now
\nrelying on government regulations and its existing cellular
\ncustomers. The issuance of ministerial decrees, including
\nMinisterial Decree Number 28, 2004, was certainly welcomed by
\nIndosat.<\/p>\n
The decree states that every telecommunications network
\noperator is obliged to provide interconnection to any service
\nprovider that requests it.<\/p>\n
But the battle for interconnection was not going to be an easy
\none. In early May of this year Telkom employees demanded that the
\nMinister of Communication and Information revoke decrees numbers
\n20, 29, 30\/2004 concerning the opening up of SLI codes in
\nTelkom's network. The decrees were deemed to inflict losses on
\nTelkom.<\/p>\n
Not wasting time in the battle for interconnection, Indosat
\nhas shifted its campaign to focus on their own cellular customers
\nthat have reached 10 million.<\/p>\n
\"We will use all our network of customers as we already have
\ncellular users, including those using Mentari and StarOne.
\nInstead of using fixed lines, we encourage people to use cellular
\nphones for overseas calls as the price of cards is getting
\ncheaper and cheaper,\" Bambang said.<\/p>\n
But Indosat will not be the sole player in the overseas call
\nservice via cellular market since other mobile phone operators
\nalso provide such services. Bakrie Telecom's E-Asia, for example,
\nhas recently offered a similar service, which enables its
\nsubscribers to make international calls to 22 countries in Asia
\nPacific regions as well as Europe, the U.S. and Canada.<\/p>\n
Consumers certainly benefit from the competition among players
\nas their rates are getting more competitive. However, the public
\nmay gain more if the competing operators battle fairly and
\nresponsibly.<\/p>\n
By opening up the telecommunications market to competition,
\nIndonesia certainly has a right to expect faster development of
\ntelecommunications infrastructure.<\/p>\n
According to data from the Post and Telecommunication
\nDirectorate General, the number of fixed-line telephones in
\nIndonesia was only 8.7 million, while cellular phones amounted to
\n23 million.<\/p>\n
Without opening the market to investors, Indonesian fixed-line
\npenetration of 4 percent will lag behind that of Malaysia's 19.79
\npercent, 46.36 percent in Singapore, 9.87 percent in Thailand,
\nand 6.85 percent in Vietnam. (Telephone penetration is calculated
\nbased on the number of telephones for every 100 people).<\/p>\n
Although is looks large, the cellular phone population is
\nmainly concentrated in big cities, leaving most of the country's
\ntowns and rural areas still way behind. Combining cellular phone
\nand fixed-lines, Indonesia only recorded 10.45 percent
\npenetration in 2004.<\/p>\n
While opening the country's international call and long
\ndistance call sectors to competition is a good start, the public
\nas the recipients of the benefits of competition has the right to
\nexpect that it will speed up the development of the country's
\ntelecommunications infrastructure. Otherwise, the government
\nshould review its policies.<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/for-telecommunications-day-may-17-1447899208",
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