Cellular phone services gain footing in C. Java

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)