Nortel eyes good RI opportunities

Nortel eyes good RI opportunities

JAKARTA (JP): Canadian telecommunications firm Nortel,
previously known as Northen Telecom, plans to expand its business
into Indonesia to tap into the country's growing
telecommunications sector.

The company's president for Asia and the South Pacific, James
C. Deas, said yesterday that Indonesia had become one of the
biggest markets in Asia in terms of telecommunications.

"We have opened a representative office in Jakarta and plan a
subsidiary," he said.

Nortel, which makes telecommunications equipment, entered Asia
about 10 years ago.

"At present, Nortel has five joint venture firms in China. We
have also had business in Japan since eight years ago and in
Australia since seven years ago," Deas said.

Deas said that Nortel had subsidiaries in most Southeast Asian
countries but not in Indonesia.

The government has allowed only three major telecommunications
equipment makers, NEC, Siemens and AT&T to supply the Indonesian
market.

With such a policy, it will be almost impossible for other
telecommunications makers to enter the domestic market.

In the cellular services, the market is more liberal. Vendors
like Motorola, Alcatel and Ericsson are already operating here.

The 100-year-old Nortel is a Toronto-based firm which makes
data networks, switching, fiber optic transmissions and wireless
network equipments.

"10 percent of our business is in Canada, 50 percent in the
United States and 40 percent in Asia, Latin America and Europe,"
Deas said.

He said Nortel was also interested in being involved in the
planned Personal Communication Network (PCN), the next generation
of digital wireless telephone systems in Indonesia.

The government will probably adopt the Digital Cordless System
(DCS-1800) and the Personal Handy-phone Service (PHS) for the PCN
project.

Three systems

At present, there are three wireless cellular systems in
Indonesia, with seven providers. The three systems are the global
system for mobile communications (GSM), the advanced mobile phone
service (AMPS) and the Nordic mobile telephone.

Sources said the government would grant at least 16 new
licenses by the end of the year including two nationwide DCS-1800
licenses.

There will be 14 PHS and DCS-1800 licenses for each of
Indonesia's seven telecommunications regions (Sumatra,
Kalimantan, Greater Jakarta, West Java, Central Java, East Java
and the eastern areas), the sources said.

Among the bidders are several big business groups including
the five private firms awarded 15-year contracts to run domestic
telephone networks in Indonesia's five different zones.

The existing GSM providers were also interested in applying
for regional licenses to operate dual-band GSM/DCS-1800 systems.
The three local AMPS operators will also upgrade their services
into the code division multiple access system. (icn)