Cellular phone services gain footing in C. Java

JAKARTA (JP): The growth in demand for fixed telephone lines in Central Java has started to decline as cellular facilities gain popularity with the local people.

President of PT Mitra Global Telekomunikasi Indonesia (MGTI), Eddy Hadijanto, estimated here yesterday that the slower growth in demand would continue.

"The growth rate of the demand for fixed telephone facilities will go flat in the next two or three years," he told reporters.

MGTI is one of five private firms to be awarded by the government 15-year concessions to develop 2.2 million telephone lines in five different regions. MGTI is responsible for installing 400,000 new lines in Central Java, including Yogyakarta, between January 1999 and March 1999.

Under a joint operation contract with state-owned PT Telkom, the company is also allowed to operate and manage the network, including the existing lines, until December 2010.

Hadijanto said his company was also considering entering the cellular services market to take advantage of the growing demand for mobile telephones in the province.

"We are participating in the cellular tender. Cellular services have become important in telecommunications."

He hoped MGTI could win a license to operate the Personal Communication Network (PCN).

The government is evaluating participants for the tenders of 11 PCN licenses which includes the Digital Cordless System (DCS- 1800) and the Personal Mobile Phone Service (PHS).

The 11 licenses consist of six regional licenses to operate DCS-1800 in Sumatra, West Java, Central Java, East Java, Kalimantan and the eastern areas and five regional licenses to operate PHS in Sumatra, West Java, Central Java, Kalimantan and the eastern islands.

"Cellular services will support MGTI's business," Hadijanto said.

At present, the country's seven mobile cellular telephone operators run three different systems. The Nordic Mobile Telephone system is operated nationally by PT Mobisel, the Global System for Mobile Communications (GSM) is operated nationwide by PT Satelindo, PT Telkomsel and PT Excelcomindo, and the Advanced Mobile Phone System is operated regionally by PT Metrosel, PT Telesera and PT Komselindo.

Among the cellular operators, GSM providers can launch their services nationwide.

Satelindo currently has 385,000 users including 10,000 in Central Java and Yogyakarta, Excelcomindo has 112,000 users including 900 in Central Java and Yogyakarta while Telkomsel has 430,000 users, of which about 35,000 are in Central Java and Yogyakarta. Mobisel has 30,850 users, 341 in Central Java and Yogyakarta.

MGTI's commissioner, D. Siregar, said the purchasing power of the Central Java population was expected to increase in line with the estimated improvement of the per capita income in the province.

"There are 35 million people in Central Java, including Yogyakarta. Current telephone density in the region is just 0.9 for every 100 people. We expect the rate will reach five per 100 people by 2000," he said.

MGTI's project in Central Java is estimated to cost about $446.2 million. The company has won a $480 million loan syndication to finance its project.

Hadijanto said MGTI had installed 146,090 lines by the end of this month, 100,000 of which were technically approved by the government yesterday. (icn)