Licenses needed to run satellite service telephone

Licenses needed to run satellite service telephone

JAKARTA (JP): The government will require any private firms
linked with overseas satellite-based telephone operators to
cooperate with the state-owned telecommunications firms if they
want to offer the services in Indonesia.

Director General of Post and Telecommunications Djakaria
Purawidjaja told reporters here yesterday overseas Global Mobile
Personal Communications by Satellite (GMPCS) operators would not
automatically be able to operate their services though they had
tied up with private Indonesian firms.

"There's no guarantee either that a private Indonesian firm
which owns equity in an overseas Global Mobile Personal
Communications by Satellite (GMPCS) operator will obtain a
license from the government to offer the services locally," he
said.

GMPCS services are classified as a basic telecommunications
service, which under the country's telecommunications law, must
be run by state-owned companies, he said

In addition, the involvement of private operators in the
Indonesian telecommunications industry (Law no. 3/1989) will be
permitted only on condition that such firms cooperate with the
state-owned companies under a joint-operation, joint-venture or
management agreement.

There are two state-owned telecommunications firms, PT Telkom
and PT Indosat.

Several overseas PCS operators have expressed interest in
entering the Indonesian market. Most of them plan to launch
services using either medium-earth or low-earth orbit satellites,
some as early as in the year 2000.

Among the PCS operators which have tied up with Indonesian
partners are Globalstar, Iridium, Constellation Communications
Incorporated (CCI), Intermediate Circular Orbit (ICO) and Global
Communications.

Globalstar which will operate 48 low-earth-orbit satellites
has secured a slot in the Indonesian market as one of the
company's shareholders.

AirTouch Communications has signed an agreement with Jakarta-
based firm PT Intidaya Sistelindomitra. Based on the agreement,
AirTouch, a leading wireless communications company based in San
Francisco, California, and Intidaya will offer Globalstar
services in Indonesia.

Iridium has also tied up with PT Bakrie Communications
Corporations, a private firm wholly owned by the widely
diversified Bakrie Group. Iridium, led by Motorola of the U.S.,
plans to use 66 low-earth orbit satellites.

Bakrie Communications is entitled to operate and deliver
mobile satellite services in Australia, New Zealand and South
Pacific countries.

PT Citra Sari Makmur (CSM), a private value-added
telecommunications firm, has been appointed by CCI of the United
States as a service provider in Indonesia and Southeast Asia.

CCI is a consortium of Bell Atlantic International, a U.S.
telecommunications giant, E-System Raytheon and Space Vest. CCI
plans to operate the Equatorial Constellation Communications
Organization (ECCO), a US$550 million satellite-based
telecommunications service using 12 low-earth orbit satellites.

Bakrie Communications, CSM and Intidaya, however, have yet to
obtain a license to sell Iridium, CCI and Globalstar services in
Indonesia, though Intidaya and CSM are each 25 percent owned by
Telkom, Djakaria said.

"They don't have to obtain licenses if they are not going to
provide or operate the service in Indonesia," he said.

Sources said officials at the Ministry of Tourism, Post and
Telecommunications had encouraged GMPCS operators to consult
first with Telkom or Indosat.

But as Telkom and Indosat showed a tough stance, the GMPCS
operators chose to tie up with local private firms first with the
hope that their Indonesian partners would do the negotiations
with Indosat or Telkom, the sources said.

In the meantime, Indosat has set up a subsidiary called PT
Indokomsat Lintas Dunia to provide ICO services and facilities.
Indosat has a 1.41 percent stake in ICO which will apply 10-
satellite system by 2000.

Indonesia will also adopt a regional satellite-network digital
telecommunications systems prepared by PT ACeS which is equally
owned by PT PSN of Indonesia, PLDT Co of the Philippines and
Jasmine International Public Co Ltd of Thailand.

PT Satelindo has also participated in Odyssey, a consortium
set up by TRW of the U.S. Teleglobe of Canada. The $2 billion
system will use 12 satellites in the medium-earth orbit and seven
earth stations with the first satellite to be launched in 1999

There are other systems which have been eying a slot in
Indonesia. Among them are the Afro-Asian Satellite
Communications; Asia-Pacific Mobile Telecommunications Satellite;
Ellipso; Global Communications; Signal; Marafon; Orbcomm;
Spaceway; Teledesic; and Telesat Mobile Inc.

Djakaria said that almost all of the GMPCS operators had
approached Indonesia in a bid enter the country's potentially big
market. (icn)