Indosat Loses Mobile-Phone Subscribers to Rivals<\/p>\n
Soraya Permatasari
\nBloomberg\/Jakarta<\/p>\n
PT Indosat, Indonesia's second- biggest mobile-phone operator,
\nlost 170,000 subscribers to other providers in the three months
\nended Sept. 30, which lowered its subscriber base to 12.7 million
\nusers.<\/p>\n
Indosat had 12.87 million subscribers in June, the company
\nsaid in August. A \"higher churn rate,\" or the rate at which
\ncellular customers change service providers as a percentage of
\nsubscribers, is the main reason for the drop, Strasfiatri
\nAuliana, a spokeswoman for the company, said in a phone
\ninterview.<\/p>\n
Jakarta-based Indosat competes with PT Telekomunikasi Selular,
\nIndonesia's biggest cellular operator, in a nation where more
\nthan three-fourths of its 238 million people don't have phone
\naccess. It's also facing competition from overseas companies such
\nas Telekom Malaysia Bhd. and Hutchison Telecommunications
\nInternational Ltd. which have invested in smaller Indonesian
\nphone companies.<\/p>\n
Phone operators \"are offering cheaper and cheaper stored-
\nvalue cards each time, some as low as rP 10,000 (99 U.S.cents),
\nmaking it easier for a customer to switch from one provider to
\nanother,\" said Ferry Yosia Hartoyo, an analyst at DBS Vickers
\nSecurities in Jakarta.<\/p>\n
Still, Indosat, which controls about a third of the mobile
\nmarket, will probably be able to achieve its target to have as
\nmany as 14 million subscribers by the end of this year, said
\nHartoyo, who has a \"buy\" on Indosat and PT Telekomunikasi
\nIndonesia, which owns Telekomunikasi Selular.<\/p>\n
\"Indosat's subscriber growth in the second quarter was
\nextraordinary,\" Hartoyo said. \"A slowdown in the third quarter
\nwas expected.\"<\/p>\n
The Muslim Eid al-Fitr holiday, Christmas and year-end
\nfestivities will boost demand for telecommunications in the
\nfourth quarter, Hartoyo said. About 85 percent of Indonesia's
\npopulation is Muslim.<\/p>\n
Telekomunikasi Selular, or Telkomsel, had 22.5 million
\nsubscribers as of July. It aims to increase the number to 25
\nmillion by the end of the year, 53 percent higher than last year.<\/p>\n
Indonesia's cell-phone users will increase to 45 million by
\nthe end of the year, according to an association of Indonesian
\ncellular operators. That may rise to about 79 million users by
\n2007, according to Morgan Stanley, making Indonesia the fourth-
\nlargest mobile-phone market in Asia.<\/p>",
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