Cellular phone airtime rates raised by 23 percent

JAKARTA (JP): After more than two months of opposition, the government and House of Representatives have agreed to raise airtime rates for regular cellular phone services by 23 percent from the current Rp 325 per minute to Rp 400.

Chairman of House Commission IV for telecommunications and transportation, Burhanuddin Napitupulu, said on Tuesday that the Ministry of Communications was expected to issue a decree to authorize the rate increase by the end of this month.

"The new rate is expected to become effective in early October," he said, adding that the agreement was reached during a meeting on Monday.

He said the government previously proposed a 30 percent increase, while the commission only agreed to let operators raise the rate by 15 percent.

Burhan said the agreement on the 23 percent raise was reached after both sides recalculated and reassessed the situation currently facing cellular operators and customers.

The rate for regular cellular telephone services is set by the government based on proposals from telephone operators, but the change is subject to House approval.

Cellular operators are free to set their own airtime rate for prepaid billing services. The government allows operators to raise the rate for the prepaid service up to 140 percent higher than the rate regulated for the regular postpaid billing service.

GSM operators Telkomsel and Satelindo are planning to raise the airtime rates for their prepaid services.

President of GSM cellular operator Telkomsel confirmed his company's plan to raise the rate for its prepaid service Simpati.

However, he did not reveal the percentage of the increase or when it would be applied. "It's still under discussion," he said.

An industry source said Satelindo would likely raise the airtime rate for its Mentari prepaid service by an average of 15 percent.

The other GSM operator, Excelcomindo, raised the rate for its Pro-XL prepaid service by 15 percent to 20 percent on Sept. 1.

There are currently seven cellular phone network providers in the country serving three systems: the Advanced Mobile Phone System (AMPS), the Global System for Mobile Communications (GSM) and the Nordic Mobile Telephone (NMT) system. They serve over 1.6 million subscribers. (cst)