Govt 'must lure telecommunications firms'
JAKARTA (JP): The government should entice telecommunications technology companies to invest in Indonesia by providing a conducive regulatory framework, an executive in the industry said on Wednesday.
General manager of Nokia Mobile Phones in Indonesia, Alexander Lambeek, said if a regulatory framework were already in place, there would be great interest among investors to operate the so- called third generation (3G) of the mobile data telecommunications technology in the country.
"There are great business opportunities and sufficient demand in Indonesia for the operation of 3G. However, Indonesia has no clear regulations on this particular sector. If this continues, Indonesia may be left behind by its neighboring countries," he said.
The 3G technology will converge the application of voice, visual and data-based systems in a mobile phone.
Japan, Lambeek said, has started developing the technology and is expected to apply it in 2002. Once it hits the market, it will quickly spread all over the world, he said.
Lambeek said a transparent regulation was particularly important to attract foreign investment to Indonesia since local players would not be able to finance the development of new technology by themselves.
However, the government is not likely to issue new licenses for mobile phone operators in the near future or new regulations concerning new investment in this sector, a government official said.
The director general of post and telecommunications at the Ministry of Communications, Sasmito Dirdjo, said he did not see the need to license new operators to bring in more advanced technology in telecommunications.
"We are still in the voice communications era, the first generation technology. There may be some people who need 3G technology, but the number is quite small. They are usually businesspeople," he told The Jakarta Post.
It was very much unlikely for Indonesia to apply the 3G technology in the near future, he said.
Sasmito, however, acknowledged the need to have more transparent and comprehensive regulations in the country's telecommunications sector.
He said the government would announce in March a new strategy development plan on the sector, the contents of which would include schedules for the issuance of new licenses for operators.
Indonesia currently has seven mobile phone operators offering three different systems: the analog-based Nordic mobile telephone system (NMT450), the analog-based mobile phone system (AMPS) and the digital-based global system for mobile communications (GSM). The seven operators serve about 2.05 million subscribers nationwide.
In addition, the government awarded in 1997 five licenses -- without any tender -- to about 11 local firms to run the European-based Digital Cordless System (DCS-1800) and the Japan- based Personal Mobile Phone Service (PHS).
In 1998, the government again awarded licenses -- through a tender process -- to another nine local companies to operate the DCS-1800 and PHS systems.
However, none of these companies have started operations due to the economic crisis, which hit the country in mid-1997. (cst)