More companies enter leased line sector

More companies enter leased line sector

I. Christianto, Contributor, Jakarta

Although many Indonesian companies are still in financial
difficulties, the advancement of information technology remains a
number one priority for many.

The use of more advanced technology for a rapid transfer of
data either in the form of voice or video is a prerequisite these
days if companies want to survive the tight competition in the
market.

The sophisticated IT technology would mean nothing, however,
if it is not supported by adequate infrastructure such as
software applications, hardware sets and more importantly the
telephone lines.

Telephone lines in Indonesia are generally made available for
monthly charges from state-owned PT Telkom but if customers want
them for a specific purpose, they can lease them.

Basically, a leased line is a telephone line that which is
leased for private use. In some contexts, it's called a dedicated
line. A leased line or leased circuit is usually contrasted with
a switched line or dial-up.

Typically, medium to large companies rent leased lines from
the telecommunications carriers to interconnect different
geographic locations to their branch offices. The alternative is
to buy and maintain their own private lines or, increasingly
perhaps, to use the public switched lines with secure message
protocols.

In Indonesia, there are few companies delivering leased lines.
Actually, until late last year, there were only PT Telkom and PT
Indosat that owned telecommunications infrastructures. Most
private companies extend leased lines by utilizing Telkom's
infrastructure.

Now customers have a new option since the privately owned PT
Excelcomindo Pratama has begun to offer leased lines through its
own fiber optic system. Excelcomindo, popularly known as the XL
cellular operator, is utilizing its existing backbone, offering
leased lines for permanent access to communications, including
the Internet, for its whole network.

Excelcomindo's corporate account manager Dedi S. Sirath said
many companies still viewed leased lines as an efficient and
economical communications tool for simultaneous, instant
connections among their branches.

"We are entering the market as a real new player as customers
knew only limited providers," he said.

In addition to Telkom and Indosat, the established players for
leased line service are, among others, PT Citra Sari Makmur and
PT Lintasarta.

Telkom, the country's domestic telecommunications operator,
offers leased circuits, which includes analog and digital
systems. The company operates its own system across the country
and remains the giant for leased line service providers as it has
been operating under a monopolistic license for decades.

Indosat which operates international telecommunications offers
leased circuits for those seeking connections abroad. The company
offers five types of leased circuit services. One of the
services, Indosat World Link, is a high-speed international
privately leased circuit providing a 24-hour, high-quality
digital communication link between one party in Indonesia to a
dedicated partner overseas with speeds ranging from 64 Kbps to 2
Mbps, suitable for constant high volume communications. The
service supports a full-range of telecommunications applications,
including high speed data communications, e-mail, a remote
database look up and processing, to more advanced applications
such as CAD/CAM. It also supports interactive audio-visual
communication.

Another service, Indosat Direct Link, is an international
high-speed digital telecommunication system providing point-to-
point, point-to-multi point or even mesh configuration that
connects subscribers in Indonesia with their counterpart
businesses overseas using satellite transmission and VSAT
equipment.

Meanwhile, Lintasarta offers High Speed Connections or a
Digital Data Network (DDN) service, which offers a premium
quality dedicated line, available for 24-hour, non-stop
operation. It uses digital technology to enable superior local
point-to-point connections.

The company also has Dedicated Internet Lintasarta, a 24-hour,
high bandwidth, dedicated connection to the Internet. Citra Sari
Makmur has the CSM MultiNet, a multi-services telecommunications
network providing solutions for data and voice communications. It
is designed to be the right solution for modern
telecommunications needs such as LAN interconnections
for data, voice and videoconferencing.

With the presence of Excelcomindo which offers XLnet, the
leased line service competition will likely be stiffer.

XLnet was a new service designed to meet corporate
communications requirements, an interesting package of services,
combining leased line services and broadband Internet access, and
presented a complete one-stop solution service for the customers,
Dedi said.

He added that an XLnet leased line service was based on the
fiber optic backbone developed by Excelcomindo which spanned from
Sumatra and Java to Bali and Lombok.

"As a new player which owns its own infrastructure, we want to
attract prospective customers to experience an unsurpassed level
of reliability and capacity," he said, adding that there were
presently some 40 customers since the introduction of the service
earlier this year.

The backbone infrastructure of XLnet utilizes microwave
transmission and SDH technology. By applying such a fiber optic
transmission technology, capacity upgrade could be easily done.

The demand for multimedia, the Internet and data
communications has and will likely increase in Indonesia
following the trend globally. Since mostly corporate users
generally apply the services, operators regard the corporations
as the main target. The competition here for high quality, modern
communications technology could get very interesting.