Telkom plans to enter cell phone market in 2001<\/p>\n
JAKARTA (JP): State-owned, listed telecommunications monopoly
\nPT Telkom says it will maintain its position as an operator of
\nfixed-line telephones while at the same time developing new
\nbusiness in the mobile telephony market.<\/p>\n
Company operations and marketing director Komarudin
\nSastrakoesoemah said on Friday that Telkom expected to inaugurate
\nits new mobile telephone service in Jakarta and some cities in
\nWest Java by mid next year.<\/p>\n
\"In the short-term, both fixed and mobile services will play
\nan equally significant role in Telkom's business. In the longer
\nterm, the mobile business may well become the most important
\ncontributor but at the same time we'll continue to operate the
\nfixed line service,\" he told The Jakarta Post.<\/p>\n
He said Telkom was hoping to sign up at least 400,000
\nsubscribers in the first year of operation of its new mobile
\ntelephone service.<\/p>\n
The government is expected to award new licenses to Telkom and
\nanother state-owned telecommunications company PT Indosat to
\noperate mobile telephone services using the GSM-1800 format in
\nAugust.<\/p>\n
The awarding of these licenses is in line with the
\ngovernment's plan to transform Telkom and Indosat into full
\nnetwork and service providers before it liberalizes the country's
\ntelecommunications sector in 2002 or 2003. This will end the
\nmonopolies currently enjoyed by Telkom and Indosat.<\/p>\n
Telkom currently holds a monopoly for the provision of
\ndomestic fixed-line telecommunications services nationwide until
\n2010 and domestic long distance services until 2005. Meanwhile,
\nIndosat and its subsidiary Satelindo have exclusive rights to
\nprovide international telephone services until 2004.<\/p>\n
Komarudin said Telkom would likely handle the new business
\nitself rather than through its existing mobile telephone
\nsubsidiaries Telkomsel and Satelindo.<\/p>\n
He said the company might consolidate its new mobile
\ntelecommunications business with Telkomsel or Satelindo, but only
\nif Telkom would be the majority shareholder.<\/p>\n
\"Otherwise, we'll probably pull out, sell our stakes and use
\nthe funds to finance the expansion of our own mobile telephone
\nbusiness,\" he said.<\/p>\n
Telkom currently owns a 42.7 percent stake in Telkomsel and
\nabout 22 percent of Satelindo.<\/p>\n
Komarudin said the establishment of the mobile telephone
\nbusiness would reflect the transformation of Telkom from being a
\nmere fixed-line operator into a full network and services
\nprovider.<\/p>\n
He said that as a full network and service provider Telkom
\nwould use both wire and wireless networks to provide telephone,
\ninternet and multimedia services.<\/p>\n
Telkom will first improve the fixed line network to enable it
\nprovide internet and multimedia services by adopting the
\nbroadband format and replacing existing cooper-based cables with
\nfiber optic, he said.<\/p>\n
As of the end of March this year, Telkom operated 6.18 million
\nfixed telephone lines across the country. About 2.87 million of
\nthese were installed under joint operation schemes with five
\nforeign joint ventures.<\/p>\n
Local and long distance telephone services have been the
\nbiggest contributor to Telkom's revenues averaging no less than
\n70 percent per year.<\/p>\n
\"The future prospects for local and long distance telephone
\nservices using the fixed-line format is still promising. There
\nare a lot of areas that still lack telephone lines and can't just
\nswitch to mobile telephony,\" Komarudin said.<\/p>\n
Telkom, in which the government holds a 66 percent stake, has
\nlisted its shares on the Jakarta and Surabaya stock exchanges and
\nthe New York Stock Exchange for its American Depository Shares.
\n(cst)<\/p>",
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"sponsor": "Okusi Associates",
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