Fri, 16 Jun 2006

Bakrie Telecom plans to expand coverage to 17 cities next month

The Jakarta Post, Jakarta

Publicly listed cellular phone provider PT Bakrie Telecom, which operates the CDMA-based esia mobile phone service, plans to expand its coverage to 15 cities in Banten and West Java next month in a bid to carve itself out a bigger share of the mobile phone market.

With coverage confined to only two cities -- Jakarta and Bandung -- at present, the firm hopes the expansion will increase its subscriber base to 1.3 million by the end of this year from about one million at present.

Bakrie Telecom corporate services director Rakhmat Junaidi said Wednesday that the company eventually planned to expand its esia coverage nationwide.

"We are in talks with PT Indosat about infrastructure sharing," he said after the company's first-ever shareholders meeting.

The company, a subsidiary of the widely diversified Bakrie & Brothers, is still waiting for the results of its feasibility studies and the outcome of the talks with PT Indosat before deciding to which cities it will expand to next.

Bakrie Telecom president director Anindya N. Bakrie said Thursday that the esia talk-time campaign launched last September had increased the number of new customers signing up to an average of 3,000 customers per day.

He said that with the increase in subscribers, in 2005 the company had managed to book Rp 244 billion (about US$25.6 million) in net revenue, 50.7 percent higher than the previous year's Rp 162 billion.

The company, which was listed on the Jakarta Stock Exchange last February, had yet to book an annual profit due to the high level of capital expenditure involved in expanding its network.

However, Anindya said that this was set to change, with the company expecting to book a net profit of Rp 7 billion for this year. "In the first quarter of this year, the company has already recorded a net profit of Rp 120 million," he said.

"We will use the profit for further expansion," he stressed.

Anindya said that the cellular phone business would continue to be extremely competitive.

He said that Bakrie Telecom's strategy in increasing its market share was to provide affordable CDMA services in collaboration with mobile phone manufacturers, such as Motorola, Nokia, Samsung and Nexian.

There are about 45 million people using mobile phones in the country at present, and about 4.4 million of them use CDMA.

Other CDMA providers in Indonesia are PT Telkom with Telkomflexi, PT Mobile-8 Telecom with Fren, and PT Indosat with Star-one. (08)