Networking business on the move

Networking business on the move

JAKARTA (JP): The private networking and wiring business in
Indonesia is expected to be worth $250 million this year and to
grow rapidly with the country's burgeoning economy.

Executives of U.S. firms Lucent Technology and Digital
Equipments said Saturday that Indonesia's growing networking
market would attract multinational wiring and networking
providers to set up manufacturing facilities here.

"Indonesia has very good potential for business expansion as
its market is picking up," said M.W. Song, a general manager at
Singapore's Digital Equipment Asia Pacific Pte. Ltd.

They said Indonesia's participation in the Information
Technology Agreement would help make the country a more
attractive place to make networking hardware.

Lucent Technology's country business manager, Redi Subekti,
said Indonesia's participation in the agreement would pave the
way to modernize the country's information infrastructure.

"Information technology is a prerequisite for a developed
economy. In addition, it will attract the most sophisticated
information technology products into the country. Thus, it will
benefit the country's economy as a whole," Redi said.

Redi said Lucent Technology, an AT&T subsidiary, would
establish copper and fiber optic wiring production facilities in
Indonesia within three years.

"For the time being, we consider the market as not yet mature
enough, and thus we need to wait until the next two to three
years," Redi said.

He said the networking business had been growing by between 30
percent and 40 percent a year and to be worth over US$250 million
this year, of which 45 percent would go to hardware, 35 percent
to software, 10 percent to wiring and 10 percent to services.

Song said Digital's market share in Indonesia was still small,
worth just $1.5 million last year. But she expected this to
double this year.

She said Digital was determined to compete with other network
providers here, like Bay Networks which has already set up wide
links with banks and other financial institutions.

Redi said Indonesia's wiring business was expected to be worth
US$25 million this year, of which Lucent expected to get 40
percent.

Wiring's high growth has been attributed to the increasing use
of local area networks by private companies, including building
management firms.

Private wiring and networking is a small part of Indonesia's
total wiring and networking business.

The networking business' value in the public sector is
expected to reach US$1.25 billion this year.

Redi said Lucent expected to grab 20 percent of Indonesia's
public network market. (rid)