Govt allows cell phone operators to set their rates
JAKARTA (JP): The government will allow local mobile phone operators to set their own rates as part of its program to gradually liberalize the country's telecommunications sector, a senior telecom official said here on Saturday.
Sasmito Dirdjo, director general of post and telecommunications at the Ministry of Communications, said, however, the government would continue to set a ceiling for mobile telephone rates in a bid to protect the public.
"The existing uniform call charge will be replaced with a ceiling tariff," he told The Jakarta Post.
The government and mobile phone operators will soon meet to discuss the details of the planned change in the policy of fixing cellular phone rates, he said.
All of the country's seven mobile phone operators charge their customers with the uniform call charge set by the government. The current call charge is Rp 325 (about 4.5 US cents) per minute.
The government currently determines the call charge for the country's regular mobile phone service based on proposals from the mobile telephone operators. Changes in the rate, however, are subject to approval by the House of Representatives.
The House signaled its compliance early last week to demands by mobile phone operators for greater freedom in setting call charges according to the terms of their services and market conditions.
The operators said the self-adjustment tariff system would positively impact customers, because it would push operators to compete with each other in providing the best service at the most reasonable price.
At present, mobile phone operators are free to set their own prices only for particular prepaid services.
Sasmito said the government previously could not allow operators to set their own rates because some of the mobile phone operators were not ready to face open competition.
According to the Association of Indonesian Cellular Telecommunications Operators (ATSI), the ideal call tariff for Indonesia's mobile phone industry is around 11 US cents per minute.
The country's seven mobile phone operators -- PT Satelindo, PT Telkomsel and PT Excelcomindo, which use the Global System for Mobile Communications; PT Telesera, PT Metrosel and PT Komselindo, which operate the Advanced Mobile Phone System; and PT Mobisel, which runs the Nordic Mobile Telephones System -- currently serve around 2.4 million subscribers.
ATSI projects the number of mobile phone subscribers will rise to over three million by the end of this year, up from around 2.05 million registered at the end of 1999 and 1.1 million at the end of 1998.
ATSI also predicts the price of mobile phone usage per subscriber will climb to an average of Rp 400,000 per month this year, up from an average of Rp 300,000 per month in 1999. (cst)