PTT Telecom ready to support PT Telkomsel

PTT Telecom ready to support PT Telkomsel

JAKARTA (JP): PTT Telecom, a major subsidiary of Koninklijke
PTT Nederland (KPN) of the Netherlands, will support the
operational system of PT Telkomsel to develop the firm into a
leading mobile cellular telephone operator in Indonesia.

PTT Telecom's president for Asia, Jan B. Volbeda, said
yesterday that after winning the battle for equity participation
in Telkomsel last week, his company would soon deploy a 20-member
team to operate the global system for mobile communications (GSM)
next month.

"The high-quality team of experienced people will join
Telkomsel in March for about 24 months. They will focus on the
sides of operation and customer care," he said.

Telkomsel announced last week that PTT Telecom and the Setdco
Group of Indonesia had won a 22.5-percent share stake in the
company.

PTT Telecom, originally in the bidding for a 20-percent stake
in Telkomsel, purchased 17.28 percent with US$304 million in cash
and $29 million in non-cash. Setdco, which is controlled by
businessman Setiawan Djody, will contribute $88 million in cash
and $8.4 million in non-cash for the other 5.2-percent share
offered by Telkomsel.

The Dutch company introduced in the Netherlands
an analog mobile cellular telecommunications system in 1989 and
started the GSM operation in 1994. Total mobile cellular
telephone subscribers in the Netherlands currently exceed
520,000, with GSM making up half of the figure.

PTT Telecom has established several joint ventures and
subsidiaries in many countries including Unisource, an alliance
with Telia of Sweden, Swiss PTT and Telefonica of Spain.
Unisource, which provides data and other value-added services for
business customers in Western Europe, has also established a join
venture company with AT&T of the United States, called Uniworld,
to provide a full range of global data and voice services for
customers in Europe.

In Indonesia, PTT Telecom also owns a 30-percent stake in PT
Bakrie Electronics Company, a Bakrie Group subsidiary which
controls PT Ratelindo, a radio telephone operator.

According to Volbeda, his company is currently involved in a
tender to join PT Daya Mitra Malindo, one of the five private
consortia awarded 15-year joint-operation contracts for domestic
telecommunication services.

Daya Mitra has failed to start its telecoms project in
Kalimantan on schedule as its foreign partner, Telekom Malaysia
Bhd., has withdrawn. The project should have begun early last
month, but Daya Mitra was given until late March to select a new
foreign partner.

In addition to PTT Telecom, there are three other companies
interested in joining Daya Mitra, including Cable & Wires of
Britain and two Asian telecom firms.

Asking about what PTT Telecom plans to do in Telkomsel,
Volbeda said: "We are offering our knowledge. What we want to do
is to transfer the knowledge. We don't intend by any means to run
Telkomsel which is more than capable to manage by itself."

He said that the transfer of knowledge would be conducted
through various programs, including training for Telkomsel people
in Indonesia or in the Netherlands. "We also plan to contribute
our expertise in developing software programs and a network
planning system."

"Mobile telephone is very important in Indonesia and will be
more and more important in the future. Nobody can deny the growth
potential of the Indonesian market with some 200 million people,"
he said.

He said that PTT Telecom will also assign two of its
executives, one as director of operations and the other as
commissioner, at Telkomsel.

In addition to president Koesmarihati Soegondo, Telkomsel has
three top executives -- Rudiantara (director of commerce), Garuda
Sugardo (director of engineering and operations) and Hulman
Sijabat (director of Finance).

Telkomsel was previously 51 percent controlled by the state-
owned domestic telecommunications operator PT Telkom and 49
percent owned by international calls operator PT Indosat.

Telkomsel, officially established in May, was capitalized at
Rp 650 billion ($280 million). After performing a successful GSM
pilot project on the islands of Batam and Bintan, the company
launched a series of expansions in Sumatra, Bali, West Nusa
Tenggara, Central and West Java. It expects to enter the key
market of Jakarta next month. (icn)