Govt to revise 3G mobile service license
The Jakarta Post, Jakarta
House of Representatives Commission IV said on Wednesday that the government had ignored warnings it had issued regarding a flawed 3G mobile service license bidding process, which might lead to the cancellation of the license.
The process, in October, was carried out by the Directorate General of Posts and Telecommunications and a team of consultants from Bandung Institute of Technology.
A member of Commission IV, Enggartiasto Lukita, said that they had issued a warning to the Directorate General to revise the conditions for the bidding process, in a hearing on July 8 and also at a working meeting on Sept. 25.
The warnings included the elimination of an up-front bidding process registration fee and monopolistic practices for the 3G license (because it only allowed one telecommunications company to provide the 3G mobile service nationwide).
However, the warnings were ignored by the Directorate General, which proceeded with the bidding process.
Director General of Posts and Telecommunications Djamhari Sirat said that they had eliminated the up-front fee to avoid the high operational costs of the 3G service, which might burden 3G service subscribers.
However, Enggartiasto contradicted the statement by saying that the target for 3G mobile services would be middle- to upper- class consumers, so it would not matter if they were charged high fees as mobile subscribers. The fees would effectively become non-tax state revenue for paying the country's debts, and various subsidies for poor people.
He also mentioned as an example that in other countries, such licenses were sold at very high prices, around several hundred million dollars. He also said that the monopoly in the 3G license case was absurd because in other countries licenses were offered without restriction for companies to buy, and the whole process was transparent.
Enggartiasto claimed that the lack of transparency on the part of the government had caused Indonesian ratings to continue declining, and had left the country as one of the most corrupt in the world.
Members of House Commission IV concluded that they would hold another meeting on Nov.19 with Minister of Communications Agum Gumelar to get more information regarding this matter.
Meanwhile, a press release from the directorate said that it would still give the 3G license to PT Cyber Access Communication as the bidding process winner, with the additional proviso that it start providing the service in September 2006 at the latest.
Meanwhile, Commission IV also questioned the appointment of two companies, PT Pasifik Satelit Nusantara and PT Citra Sari Makmur, to carry out a government project aimed at providing basic telephony services for about 43,000 villages that currently lack them.
"We didn't know if the two companies were really capable of carrying out the project. Why were these two appointed; why not any of the others?" Enggartiasto said, adding that the commission would seek an explanation from Agum at the upcoming meeting.
The government appointed the two companies, without a tender process, to carry out the Universal Service Obligation (USO) program aimed at providing phone services for all citizens.
As initial funding, the government will allocate Rp 45 billion (US$5.02 million) from the state budget for the three-year project.