LGEIN to provide handsets for users of Mobile-8

Zakki P. Hakim, The Jakarta Post, Jakarta

South Korean giant LG Electronics Inc. expects to double its sales of fixed-wireless handsets in Indonesia to 400,000 units this year via a partnership with local service operator Mobile-8 Telecom, an executive at the company's Indonesian unit says.

PT LG Electronics Indonesia (LGEIN) president director Kee Ju- lee told The Jakarta Post recently that Mobile-8 telecom customers would be able to use LG handsets starting in March.

"We aim to double our handset sales from 200,000 units last year to 400,000 units in 2005 through the partnership," Kee said.

Fixed-wireless service, which uses Code Division Multiple Access (CDMA) technology, is a phone service with limited cellular mobility in a designated area that was first introduced in Indonesia two years ago.

The service offers rates almost equivalent to the rates of the fixed telephone service, much cheaper than those of Global System for Mobile (GSM) phone operators.

Cellular services, both using CDMA or GSM technology, are seen as answers to the prevailing problem of limited access to fixed- line telephone connection in the country.

At present, only about 8.5 million people -- less than 4 percent of the 220 million population -- have access to fixed- line phones, while about 30 million people subscribe to the existing mobile phone services provided by GSM operators alone.

Earlier, Mobile-8 Telecom announced that the company targeted one million new subscribers this year in addition to the existing 500,000.

Although LG is still a "smaller" player in the country's handset market today, it is one of the leading players in the world market.

In the global market last year, LG Electronics sold up to 44 million handsets (more than 70 percent were CDMA handsets), amounting to total sales of 8.35 trillion won (US$8.08 billion) or up 61.1 percent from the previous year.

LG Electronics expects to maintain its No. 1 CDMA handset sales ranking in the North American region by establishing additional businesses with operators.

In 2005, overall handset sales are expected to grow by 40 percent to 62 million units, mostly CDMA.