PSN to invest $11 million in communications system

JAKARTA (JP): PT Pasifik Satelit Nusantara (PSN) plans to invest US$11 million in the establishment of a micro earth-based communications system to provide extensive telecommunications services across the country.

PSN's president, Adi Rahman Adiwoso. in a hearing with members of the House of Representatives' Commission V for communications, said that the system -- known as the VSAT or XPress Connection -- will allow communications to take place between the country's remotest villages.

"The contract to develop the system was signed last year with Titan Informations System Corporation of the United States," he said yesterday.

The development of the XPress Connection is expected to start this year, he added.

"We are not yet sure about the form of cooperation with our foreign partner but, to make sure the project runs smoothly, we have also started discussions with (state-owned) PT Telkom," he told reporters.

Apart from installing telephone lines in remote villages, PSN is also trying to impose affordable rates for the new lines, he said.

"We will try to make them the same as Telkom's," he said, but added that the rates will nonetheless be determined on the basis of the location of the villages.

Adiwoso said a try-out of the XPress connection will be carried out early next month for the eastern part of Indonesia.

By the end of this year, PSN is expected to start the project throughout the country in collaboration with Telkom on a joint operation (KSO) contract basis, he said.

Adiwoso said PSN is now also completing a mobile-satellite- based cellular telecommunications system covering the Asia Pacific region.

The system will be managed by PT Asia Cellular Satellite System (ACeS), whose shares are owned by Philippines Long Distance Telephone Co. of the Philippines, Jasmine International Public Co. Ltd. of Thailand and PSN.

PSN's investment in the system's satellite, called "Garuda", exceeds $700 million, Adiwoso said.

PSN, set up in 1991, is a joint venture between overseas and domestic firms. The company's shareholders include PT Telkom, PT Elektrindo Nusantara, a subsidiary of the Bimantara Group, PT Skaisnetindo Teknotama, owned by Iskandar Alisjahbana, PT Primaupaya Lintaswara, Hughes Space and Communications Inc. of the United States and Telesat Canada.

Last week PSN floated 10.95 million shares on the Nasdaq capital market in the United States and expects to raise $67 million from the share sales.

The company is the country's first private satellite and telecommunications operator to go public. (pwn)