Dealers raise cellular phone connection fees
Dealers raise cellular phone connection fees
JAKARTA (JP): Operators of Global System for Mobile Communications (GSM) telecommunications view the illegal increase in fees for cellular telephone connection as a compliment for telecoms services in the country.
"We see it as a compliment that our service is sold at a premium," Satelindo's general manager for marketing, Raymond C. Chatab, said.
Satelindo is one of the two current operating GSM providers in Indonesia. Satelindo controls the digital mobile cellular telephone market in Jakarta, while PT Telkomsel, the second GSM carrier, is still new to the city.
Under government regulations, the installation of a GSM telephone costs Rp 390,400 (US$167) which includes a subscriber identity module (SIM) card of Rp 300,000, the first monthly subscriber charge of Rp 50,000 with value added tax of Rp 5,000, a frequency administration charge of Rp 25,000, a monthly frequency utilization charge of Rp 8,400 and stamp duty of Rp 2,000.
However, many GSM dealers in Jakarta and other big cities charge between Rp 500,000 and Rp 550,000 for new GSM installation.
A GSM dealer at the newly-opened Mal Mangga Dua in Central Jakarta, for example, charges Rp 550,000.
"If you want to buy a handset worth Rp 1.6 million, just pay Rp 2.4 million and you will get the handset and two SIM cards from Satelindo," the dealer said. "Or pay Rp 2.1 million and you get the hand set and one SIM card and line connection will be made in one day."
Satelindo has launched a promotion program allowing customers to have two SIM cards while purchasing just one handset. Many dealers take advantages from the promotion as most buyers don't want two SIM cards. The promotion expires by the end of this month.
The dealer said that he also sells Telkomsel's SIM card at Rp 550,000, which will be connected within three days.
The dealer admitted that the official price of the new installation of a GSM telephone is just Rp 390,400. "But this is business, we are looking for higher profits."
Satelindo's president, Iwa Sewaka, told The Jakarta Post over the weekended that he would study the pricing issue.
"We will review partnership with dealers which set illegal prices," he said.
Early this year, Satelindo followed Telkomsel's lead in adopting an open market system which allows subscribers to buy and use any handset sold by agents or other distributors, not just the brands specifically recommended by the GSM operators. Previously, SIM cards issued by Satelindo would not work in "unlisted" handsets. (icn)