Cellular phone use to increase steadily

Cellular phone use to increase steadily

JATILUHUR, West Java (JP): The government's plan to license
more operators in the next few years, coupled with the decrease
of handset prices, will help maintain the high growth of cellular
telecommunications services until 2000, an executive said.

A director of cellular operator PT Telkomsel, Ardhin Ichwan,
said here yesterday that cellular telecommunications services are
likely to grow in the coming years at rates higher than those
projected by Merrill Lynch of the United States.

According to Merrill Lynch the country's cellular
telecommunication services, which expanded by 41 percent in 1993
to 80 percent in 1994 and to 127 percent last year, might grow by
97 percent this year.

The growth rate might decline to 76 percent in 1997, to 37
percent in 1998, to 38 percent in 1999 and to 31 percent in 2000.

Ardhin told reporters in a telecommunications workshop held at
the training center of state-owned PT Indosat here that better
services and lower prices of handsets resulted from tighter
competition will surely prop up demands in the coming years.

There are currently seven mobile cellular telecommunications
operators in Indonesia, applying three different systems -- the
Advanced Mobile Phone System, Nordic Mobile Telecommunications
and the Global System for Mobile Communications. They have
attracted some 400,000 subscribers throughout the country.

The government plans to launch an open bid to select an
undisclosed number of new cellular operators with improved
cellular technologies, including the Personal Handy-phone System
and the Digital Cordless System.

An Indosat manager, Sutrisman, said that price reductions will
continue in the coming years because the global
telecommunications industry is also marked by the downward trend
of tariffs.

"Tariff restructuring in the country, therefore, is inevitable
due to fiercer competition," he said.

When asked for comment, the Ministry of Tourism, Post and
Telecommunications' Secretary-General Jonathan L. Parapak refused
to specify whether the government will set new telecommunications
tariff structures.

According to Merrill Lynch, even though the growth rate of
Indonesia's cellular services will decline to 31 percent in 2000,
the rate will remain the highest in eastern Asia.

The growth rate of cellular services in China, for example, is
likely to reach only 25 percent in the year 2000, in the
Philippines 20 percent, in South Korea 19 percent and in Taiwan
16 percent.

However, the rate of market penetration of cellular services
in Indonesia will remain the lowest in the region, which is
estimated at only 0.2 percent in 2000, as compared to 38.1
percent in Hong Kong, 27 percent in Singapore, 18.2 percent in
South Korea and 11.3 percent in Malaysia. (icn)