Local cellular operators will earn US$720m in 1997

JAKARTA (JP): Domestic mobile cellular telecommunications operators will earn US$720 million next year because of more subscribers, a PT Telekomindo executive said yesterday.

Rudiantara said yesterday there would be between 600,000 and 620,000 domestic cellular users by the end of this year.

"The figure is predicted to double by the end of 1997," he said.

Telekomindo, which runs the Advanced Mobile Phone System (AMPS), is one of the country's seven cellular operators. The company has shares in PT Excelcomindo which operates the Global System for Mobile communications (GSM).

Rudi said the seven cellular operators were projected to earn about $800 from each of their subscribers next year, excluding revenue from long distance and international calls which would go to PT Indosat, PT Telkom and PT Satelindo.

The government estimated there would be about 1.2 million users by the end of next year, he said. "But even if there were only about 900,000 users by the end of 1997, revenue would exceed $720 million."

"The cellular telecommunications business is very promising in Indonesia," he said.

He said the cellular handset market would also be more promising next year.

"Say a handset costs about Rp 750,000 ($317). Cellular handset deals would be worth at least $142.65 million for about 450,000 new users in 1997," he said.

The government has licensed seven mobile cellular telecommunications operators: Telekomindo, PT Metrosel Nusantara and PT Komselindo which run AMPS; Excelcomindo, PT Telkomsel and PT Satelindo which serve GSM; and PT Mobile Telephone which runs a Nordic Mobile Telephone system.

Excelcomindo president Julius S. Djohan said yesterday his company would enter Bali, Lombok, Yogyakarta, North Sumatra and Central Java after penetrating key markets in Jakarta, Bandung (West Java) and Surabaya (East Java) which it entered last month.

"We will invest between $250 million and $300 million in 1997 in addition to about $250 million invested this year," he said, adding that most of this would be used for infrastructure.

He said Excelcomindo, which goes under the GSM-XL brand, had about 6,000 users. "We expect to have 150,000 users by 1997."

"To win the country's highly competitive cellular business, we must focus on customer service. If we promote something special, we must consequently establish and maintain that service, or our users will leave us," he said.

He said domestic GSM operators' main problem was selecting good spots for base transceiver stations. (icn)