RI expected to have 35m phone lines by 2004

RI expected to have 35m phone lines by 2004

JAKARTA (JP): Indonesia may have at least 35 million telephone
lines by the end of the Seventh Five-Year Development Plan
(Repelita VII) in March 2004, much more than the government's
original target, an executive said yesterday.

President of PT Pasifik Satelit Nusantara (PSN), Adi R.
Adiwoso, said there were many rural areas in the country that had
vast potential for market penetration.

"The market is there (in the rural areas). About 180 million
people are living there and I'd like to expand along with the
economic growth," he said.

He said that PSN currently operated Xpress Connection, a very
small aperture terminal which provides telephone lines in remote
areas through a satellite-based wireless telecommunications
system.

Based on official data, by March 1999 (the end of Repelita
VI), Indonesia is projected to have some 11 million installed
telephone lines for its 204 million population with a telephone
density rate of 5.39 per 100 people.

The figure is estimated to reach 21.5 million lines by the end
of Repelita VII for a population of some 219 million with a
telephone density of 9.82 per 100 people.

The figures for 2009 are projected to reach 31 million lines,
a 233 million population and a ratio of 13.3 lines per 100
people.

"The projection will be surpassed as we can use sophisticated
satellites to double telephone line installation, particularly in
rural areas," Adiwoso said.

He said that investment per line unit would also be cheaper if
there was a higher rate of subscriber density.

"PSN has set up PT MultiMedia Asia (M2A), a joint venture with
(state-owned) PT Indosat, which will operate the M2A satellite.
The satellite will be able to serve voice, data and Internet
services," he said.

He said that through the satellite, telephone investment per
line unit would be some US$800. Currently, a telephone line
investment costs some $1,000.

"Price elasticity is very important to eliminate the entry
barrier for people who wish to have telecommunications
facilities," he said.

Asked about licensing, he said the government had approved his
plan to penetrate the country's rural areas. "This is about
Repelita VII, prospective operation or regulation from the
government will be applicable then."

The government rules that telephony services are operated only
by state-owned Indosat and PT Telkom. Private firms must work
with state-owned telecommunications operators under a joint-
operation, joint-venture or management agreement,

"We will be able to use one of the operational arrangements
when we are ready with the operation," Adiwoso said.

The M2A satellite will provide multimedia digital
telecommunications services into small fixed antennas directly to
end-users with Asia-wide coverage. The system, scheduled to begin
operation in 1999, will be able to serve up to four million users
in Indonesia, Southeast Asia, Australia, China, Korea and Japan.

Adiwoso hoped to install some 20 public telephones using the
M2A system in each of some 66,000 villages in Indonesia by the
time the network is ready. (icn)