Cellular phone operators lose Rp 200b on bills

JAKARTA (JP): Local cellular telephone operators have lost Rp 200 billion (US$26.66 million) due to unpaid customer bills, the Association of Cellular Telecommunication Indonesia (ATSI) said yesterday.

The association's chairman, Soedjono Kramadibrata, said the companies could not trace many of their debtors because they had submitted false identities and addresses when applying for an account.

"Competition between cellular operators made the companies strive to attract customers by offering easily obtainable accounts," he said after the signing of a memorandum of understanding (MOU) to fight customer fraud.

"This condition caused companies to be slack in verifying the data of their applicants, and gave way to bad customers," he said.

These customers abused the situation to change from operator to operator, leaving their bills unpaid, he said.

"In Komselindo alone, bad debts account for 20 to 30 percent of our total (projected) revenue," said Soedjono, who is also president of PT Komselindo, one of the country's cellular providers.

He said there was not an institution which could provide verification of customer data.

Cellular operators could not obtain data on potential customers from competitors in the past because the companies were unwilling to give out customer information.

Under the MOU signed yesterday, the country's seven cellular operators agreed to establish a customer data verification center to eliminate fraud. The database facility will be available in July, Soedjono said.

It will enable the mobile phone operators to verify the data submitted by the applicants of their services.

The companies will be able to check whether their applicants have previously been customers of other operators and have left unsettled bills, he said.

The country's seven mobile operators use three different systems in cellular mobile telecommunication services.

The digital GSM is operated by PT Telkomsel, PT Satelindo and PT Excelcomindo.

The analog system, Advanced Mobile Phone Service (AMPS), is operated by PT Metrosel Nusantara, PT Telesera and Komselindo.

PT Mobisel operates the Nordic Mobile Telephone (NMT-450), the analog service primarily installed in vehicles run by PT Mobisel.

The association said the number of cellular users grew by 100 percent last year.

Despite the monetary crisis, which has slashed the rupiah's value against the dollar by about 70 percent, growth in the number of cellular customers will be about 50 percent this year, he said.

He said the number of cellular users currently totaled between 900,000 and 1.3 million.

The association also urged the government to raise cellular phone tariffs.

"However much the rate increase, it would not be enough to return our high investment in this business," Soedjono said.

"However big the rise is, it would still be like a drop of water in the dessert," he said.

He said most of the components in the mobile phone business were imported. About 90 percent of investments are made in U.S. dollars.

"This is a heavy burden on us," he said.

Soedjono estimated the seven operators' turnover to be about Rp 1.8 trillion a year. (das)