Government to increase fixed-line and mobile phone rates
Government to increase fixed-line and mobile phone rates
JAKARTA (JP): The government will increase the rates of fixed-
line and cellular telephone services by 21 percent and 41 percent
respectively some time in June, to meet rising telecommunication
costs.
Director General of Post and Telecommunications Sasmito Dirdjo
said on Tuesday the rates for fixed-line telephone services would
be increased by 21 percent to Rp 226 per three minutes from the
current Rp 187 per three minutes.
While the cost of using a cellular phone will increase by 41
percent to Rp 475 per minute from its current Rp 325 per minute,
he said.
"We expect the new rates can be implemented before mid-July
this year, soon after we meet with the House of Representatives
to hear their views on the plan," he said.
Sasmito said the government decided to increase the rates for
fixed-line telephone services, which are currently provided by
state-owned telecom monopoly PT Telkom, to help the company cope
with rising operational costs.
"The current tariff is no longer acceptable. It is not
sufficient to allow Telkom to generate funds to expand its
network," he said.
Telkom currently operates 6,185,793 active telephone lines
across the country, which has a population of over 200 million
people.
He said the government planned to further increase the rates
for fixed-line telephone services by between 15 percent and 18
percent in 2001 and eight percent in 2002.
The government reviews the fixed-line telephone service rates
every year. It raised Telkom's rates by 15 percent in February
last year.
Sasmito said the raise in cellular phone charges was also
aimed at helping cell phone operators accelerate their recovery
from the impacts of the economic crisis.
The country's seven cellular phone operators, which currently
serve 2.41 million subscribers, have asked the government to
raise the rates several times but with no success.
The operators have said they have booked less profits since
the crisis, despite the constant growth in subscriber numbers,
because their rupiah earnings could not cover their dollar-based
investments.
Sasmito said that in order to create a more conducive business
climate for the country's telecom sector, the government was
ready to allow both fixed-line and cellular phone operators to
set the rates in accordance with market demands.
"Very soon, the government will hand over decisions on
telecommunications rates to market mechanisms," he said, adding
that the government would likely only set the structures and the
ceiling price for the rates.
Sasmito also said at the briefing the government planned to
increase postal rates to local destinations before the middle of
this year.
The cost of delivering a document, including a letter,
weighing less than 20 grams will increase to Rp 900 from its
current price of Rp 500. While the rate for a doucment weighing
between 50 grams and 100 grams will increase to Rp 1,600 from Rp
80 at present.
The cost of sending a postcard will increase to Rp 800 from Rp
250 at present.
Sasmito said international postal rates would be determined by
the directorate of the postal service. (cst)