GSM operators to start DCS-1800 this year

By Tantri Yuliandini

JAKARTA (JP): PT Telkom, PT Indosat and the country's three GSM cellular operators plan to start their DCS-1800 networks this year.

PT Telkom and PT Indosat, the first companies to receive licenses to operate under DCS-1800 networks, will launch their services in August.

Existing cellular operators PT Telkomsel, PT Satelindo and PT Excelcomindo Pratama, which have previously been serving the Indonesian cellular market under GSM-900 megahertz, expect to start DCS-1800 services before the end of this year.

Telkom's TelkoMobile business development manager Dedi Suherman said on Wednesday that he was optimistic about Telkom's opportunities, despite fierce competition from the already established market of the three other operators.

Dedi said that he had noticed that customer loyalty between the services was very low, proven by the fluctuating growth of customers between one operator and the next over several months.

"The flourishing sale of prepaid services is another indication (of low customer loyalty). This offers opportunity for new players to enter," he said at a seminar on the cellular phone business here.

However, Dedi said Telkom realized that it would need a niche to be able to succeed against other players, and that niche came in the form of general packet radio service (GPRS).

GPRS is a packet-switched mobile datacom service that enables high-speed transmissions needed for mobile Internet browsing and e-mail.

"With a speed of up to 115 kilobit per second, hundreds of applications can be made, least of all a mobile billing and banking system," Dedi said, giving an illustration of the countless applications that can be used with only a standard 56.2 kilobyte per second Internet connection including multimedia applications.

Telkom will begin its services in Jakarta, Bandung and Bandar Lampung, targeting about 200,000 customers, he said.

For its cellular project, the state-owned company invested about Rp 90.5 billion (US$9.5 million).

It expects to install 400,000 lines within two years of the initial launch, with the number of customers predicted to reach 495,000 within three years, especially with Telkom's plan for a convergence system between fixed telephone line and mobile, Dedi said.

"Customers could have a single phone number for both their mobile and fixed phones, with a single billing system, and unified messaging service," he said.

Another state-owned company, PT Indosat, also plans to market its cellular service within the year.

Chief of Indosat's multimedia mobile project Hasnul Suhaimi said the company would be ready to launch its mobile services also in August this year, with GPRS technology gradually adapted toward the third generation universal mobile telecommunications system (UMTS) by 2004.

UMTS supports data transfer rates of 144 kilobits per second for vehicular traffic, 384 kilobits per second for pedestrian traffic and up to two megabit per second in support of in-building services.

For the phase of the mobile service, Indosat will focus on Java, Bali and Batam, constructing about 500 base transceiver stations (BTS) in 11 cities, Hasnul said.

He said that the second phase, would cover major cities across Indonesia, involving about 1,300 BTS.

Recently, Indosat issued bonds worth Rp 1.5 trillion (about $158 million), of which 35 percent would go to the development of its cellular business.

Contrary to public belief that the DCS-1800 needs a much higher investment than the GSM-900, Hasnul said that in the long run they both cost about the same.

"In terms of coverage, the GSM-900 is about 10 percent cheaper than the 1800, but in terms of capacity it is 10 percent more expensive," he said.

The GSM-900 has a bandwidth of 25 megahertz, while the DCS- 1800 has a 75 megahertz bandwidth and is capable of a much higher capacity, Hasnul said, adding that in the meantime the DCS-1800's wavelength measures only 16.5 centimeters, which is a more limited coverage capability than GSM-900's 33-centimeters wavelength.

Indosat conducted a trial call for its cellular system in late December last year, both to the Indonesian consulate general in Hong Kong and to Vice President Megawati Soekarnoputri in Saudi Arabia from Jakarta, he said.

Hasnul said the prospects for the cellular business in Indonesia was still wide open for new operators, as the market was predicted to keep increasing at a rapid pace.

By the end of 2000, the number of cellular phone users in the country was predicted to be about 3.7 million, he said, adding that this year the number is expected to grow to about five million users, and about 24 million users by the end of 2010.

PT Excelcomindo Pratama, a GSM cellular operator which has also obtained a license to operate the DCS-1800, has a different strategy in incorporating the network into its existing service.

Excelcomindo's general manager for engineering M. Danny Buldansyah said that the 7.5 megahertz of frequency allotted for its DCS-1800 network, in addition to the 7.5 megahertz already used for operating the GSM-900 network, would be enough to incorporate about three million subscribers.

"The expansion to DCS-1800 is crucial as network quality has increasingly worsened in line with more utilization," he said.

Danny said that Excelcomindo would operate the DCS-1800 for highly congested areas such as in the central business district in Jakarta.

"We will also operate the service in public utilities such as plazas and malls, also office buildings in the CBD," he said.

In upgrading the system, Excelcomindo assures that it would not disrupt the existing system already available.

"Customers can still use their existing subscriber identity module (SIM) cards, and will not even realize when their cell phone system switches to DCS-1800 or back to GSM-900," he explained.

However, those who own older handset models with only one band would not be able to access the service.

"But we'll only begin to operate DCS-1800 in buildings in 2002, and by then almost all handsets will have a dual-band facility," Danny said, adding that the operation of the network in open areas was expected to be fully operational in April.

He said that Excelcomindo's focus for the system was on the Jakarta area, where customers had reached more than 400,000 subscribers. Other areas would follow once the number of subscribers exceeds 400,000, Danny added.