Cell phone market continues rapid growth

Cell phone market continues rapid growth

The Jakarta Post, Jakarta

The Indonesian Cellular Telecommunications Association (ATSI) is
optimistic that the market penetration of cellular phones in
Indonesia next year will reach a level equivalent to 40 percent
of the population.

ATSI chairman Johnny Swandi Syam said that the growth in the
country's cellular phone industry from January to June was
satisfactory, with 10 million new subscribers being signed up,
boosting the total number of subscribers to 40 million.

"Regions like Batam, Riau Islands, Yogyakarta and Jakarta
recorded average growth of more than 30 percent, which makes us
optimistic that 40 percent market penetration will soon be
achieved," he said at the opening of the Indonesia 2005 Cellular
Show at the Jakarta Convention Center.

Despite the rapid growth, Johnny said that Indonesia's market
penetration level lagged well behind many countries in Southeast
Asia.

Various sources show that Singapore has 89 percent market
penetration, Thailand 41 percent, Malaysia 53 percent, and the
Philippines 36 percent.

Johnny said that Indonesia's penetration level today was only
about 18 percent.

ATSI secretary-general Rudiantara explained that of the 40
million subscribers, 22 million belonged to Telkomsel, 12.5
million to Indosat, and 4.5 million to Excelcomindo.

Rudiantara said that if the growth continued, the number of
subscribers could reach more than 80 million next year.

"ATSI believes that next year, Indonesia's penetration will
match that of the Philippines," he said, adding that ATSI's
optimism was based on the fact that growth tended to be higher in
the second semester.

He also said that the huge investments being made by cell-
phone operators here would lead to more services being available
to customers.

"So far this year, ATSI has recorded US$1.8 billion in new
investment in the industry, already 30 percent higher than the Rp
1.2 billion invested last year," he said.

He said that most of the new investment was focused on the
introduction of new technology, particularly 3G.

With 3G technology, cellular operators can provide multimedia
facilities at faster speeds and with much more data than the
current cellular technology being used here, which is classified
as 2.5G.

To support ATSI's drive to introduce 3G, the association is
holding the Indonesia 2005 Cellular Show from July 20 to July 24,
which will feature 39 operators and authorized dealers
nationwide.

ATSI and event organizer Dyandra Promosindo expect around
100,000 visitors to the exhibition, but have set no sales
targets.

"The show is intended to introduce the latest developments in
cell phone technology and to connect customers to vendors and
service providers," Rudiantara said. (006)