It's hard to live without it

By I. Christianto and David Eyerly

Nowadays, cellular phones are beginning to resemble fashionable must-have personal tools. Some people can not even imagine how to live without the handsets as they also enjoy the features in the handsets while not using them as communications devices.

And Indonesia is still a big market.

To realise how big and how the current competition among the existing players is, the following reports and and some other issues on the following two pages might help explain the business in this country.

JAKARTA (JP): Telecommunications equipment makers have created mobile phones with various features. These include products which combine several functions such as organizer, camera, television, or MP3 player.

Are such features really useful for the users?

Some users may think they do not want to have certain features, and others think they do not even know how to operate the features.

This can happen when they only want to use the handset for style.

General manager for marketing of PT Ericsson Indonesia, Alino Sugianto, said there actually was a large part of cellular phone users who only wanted be stylish.

"This group always seeks the newest types and models which offer style," he explained.

He said that there was another group that was technologically- oriented.

Such a situation forces handset makers to develop various types, he added.

Ericsson, for instance, provides several types of handsets including the A, R and T classes.

The A type, like the A26185, is suitable for those seeking fun as the cover of the handset is changeable. The R types, including the R320s and R380, have full features options and are waterproof and shockproof as well. The T types, including the T10, T28 and T20, offer trendy shapes and appearance and are favorites for those seeking image.

Another feature which is needed by users is multi-band facility which offers ease when they are abroad where local operators use frequencies different to the home operator.

Multi-band is available in the Timeport series produced by Motorola.

Yanty Agus, marketing manager of PT Motorola Indonesia, said that the Timeport P7689 is a tri-band handset which operates in the 900Mhz, 1800Mhz and 1900Mhz frequencies. "Therefore, users from Indonesia who frequently travel to the U.S., for instance, can use the same handsets when visiting that country," she said.

There is another feature offered by Motorola which attracts many people, namely the voice note which can record conversations of up to three minutes.

Meanwhile, Samsung has some products which offer interesting, usable features. Among other, the answering machine on the SGH800 and N100.

This internal answering machine will save expense as the users do not have to dial the voice mail box which incurs costs.

The voice command, voice dialing and organizer features found in other Samsung products are also useful features for users.

Competition among cellular phone makers has never been stiffer. They create products with great attention to size, weight and features.

Nokia's products, for instance, are usually tiny cellular phones, with less weight but numerous features.

The Nokia 3310 allows the user to chat or send multiple SMS (short messaging service) messages. The feature will depend on the networks of the cellular operators.

Changeable, colorful covers, ringing tones and picture messaging have also been top features for Nokia users. In addition to the N3310, these features can also be found on the N3210.

As well, the N3210 has an attractive feature allowing users to compose their favorite song as the ringing tone and send it to other handsets.

Nokia has aimed the N3210 at the youth market while the N3310 is targeted at both youth and the young-at-heart. Both products also have games installed as a further enticement.

Segment

There are five segments considered by Nokia: entry level, youth, fashion, classic and communicator. Therefore, the features incorporated in a particular Nokia product will depend on the segment it is targeted at.

For instance, the N8219, created for the fashion segment, is popular with female users as its colorful cover is changeable and weighs in at only 79 grams and measures 101 mm by 44 mm by 17 mm.

There is also the N8250 which has also been popular for its blue back-light on the LCD.

Another favorite brand which offers desired and usable features on its products is Siemens.

Farid Manan of PT Dian Graha Elektrika, Siemens' sole agent in Indonesia, said that longer talking-time and bigger capacity for memory were among the most sought after and usable features.

"Most Siemens users are loyal users, meaning that they do not want to change to other brands as Siemens products are well-known for their better signal. Users can still make or receive calls with Siemens handsets in certain areas where other brands can't perform well," he said.

Siemens has recently launched an innovative product, the SL35, which combines a cellular phone and an MP3 player. This product may attract music lovers who always want to be accessed.

Trend

There are actually two groups of users: those who are satisfied with "simple" handsets as they only want to make and receive calls. This group does not care about the latest technology or features as long as they have access to communications.

The other group consists of those who want the basic functions of a cellular phone and like to play with the features on the handsets. Usually they want smarter and more entertaining features, longer lasting batteries, multi-band and other value- added features.

But the market trend shows that cellular phones have become a lifestyle necessity for most. So, people are looking for lighter, smaller, cuter handsets.

As the handsets have become a style, many people own several cellular phones of different types or brands to match their needs and activities. No wonder if handset makers regard Indonesia as one of the most prospective markets in the world as Indonesians are known as being top consumers seeking style who want the best, latest, most fashionable and most expensive products and brands.

Operators

Indonesia's seven cellular operators can expect some company soon as a number of new operators look to join the party and make their mark in the country's cellular market.

State-owned PT Telkom and PT Indosat have both been granted the right to operate on the advanced GSM 1800 system, and these two companies expect to eventually offer national coverage with their networks.

In addition, six other companies have been given licenses to operate the GSM 1800 system regionally outside of Greater Jakarta. They are PT Ariawest International in West Java, PT Astratel Nusantara (Sumatra), PT Mitra Perdana (Central Java), PT Natrindo Global (East Java), PT Primarindo Sistel (Kalimantan) and PT Kodel Margahayu in eastern Indonesia.

What this increased competition will mean for the prices and services enjoyed by customers remains to be seen, and there is no certainty that these companies will even be up and running, much less survive over the long-term. Only time will tell if these new kids on the block have the right stuff.

Currently, most of the focus is on Telkom and Indosat, and how these two telecommunications giants will handle their new role as cellular operators. Telkom has targeted August 2001 for the official launch of its cellular services.

The company's head of investor relations, Setiawan Sulistyono, said in December the company would first install 200,000 lines covering Greater Jakarta, Bandung and Bandar Lampung. He said the company spent Rp 90.5 billion in 2000 to get its cellular business off the ground.

He said the company expected to install 400,000 lines within two years of its launch and was targeting 495,000 customers within three years of beginning its cellular service.

The infrastructure is being built by communications company Siemens Indonesia, which won the 62.7 million euro and Rp 28.8 billion contract tender.

A company official said Telkom would offer customers prepaid and postpaid SIM cards, allowing customers to use the general packet radio services (GPRS).

GPRS is considered 2.5G technology, the stepping-stone to third generation technology. GPRS offers higher speed data transmission, allowing for such features as mobile Internet browsing and e-mail.

Indosat is also looking to make a big splash in the country's cellular market. It has reached an agreement with international telecommunications company Ericsson for the construction of its network.

Agung F. Adi of Indosat's public relations department said Indosat would eventually offer national coverage.

The company's general manager, Indar Atmanto, said earlier, this project, Indosat Multimedia Mobile (IM3), will be accomplished in several phases. The first phase will bring coverage to much of Java and Bali. In the next phase, the company plans to cover the northern coast of Java, Medan, Riau, and the main cities in Kalimantan, Makassar and Manado.

The final phase, which Indar expects to be completed in 2003, will cover the southern coast of Java and other provincial capitals.

While Agung could not give any definite targets the company has set in terms of customer numbers, the company said earlier in the year that it is targeting signing up 300,000 customers in Jakarta alone during the first year of its operations.

The company has said it hopes to increase its customer base by cooperating with the existing cellular operators on the GSM 900 network, namely Telkomsel, Satelindo and Excelcomindo. Indosat owns a 7.5 percent stake in Satelindo and a 35 percent stake in Telkomsel. But according to Agung, the company has not made any formal agreements to cooperate with these companies, though it is still exploring the possibility.

In terms of services and features it will offer customers, Indosat Multimedia Mobile will operate the GSM 1800 network, allowing it to bring to cellular users Internet-based services such as Wireless Application Protocol (WAP).

Agung added that the company hoped to enter 3G cellular technology in 2002, though the date is tentative. With 3G technology, the company will be able to offer customers such features as video and data transmission, interactive audio and Internet games.

While these features may be some time off here in Indonesia, it appears that the country's two newest cellular operators, Telkom and Indosat, are taking the necessary steps to prepare for and anticipate the rapid developments we can continue to expect in the world of cellular communications.