RI government to pick one more GSM operator

RI government to pick one more GSM operator

JAKARTA (JP): The government will hold an open bid to choose a
qualified company to operate cellular telecommunications using
the latest technology, called the Global System for Mobile
Communications (GSM), an executive says.

"Only three companies will be allowed to run GSM
telecommunications, with PT Telkom and PT Satelindo slated to be
the first two operators in the country," the development director
of the state-owned domestic telecommunications company PT
Telekomunikasi Indonesia (Telkom), Koesmarihati Soegondo, told
reporters yesterday.

She said that because of the strict licensing for frequency
and roaming utilization in GSM, three operators are adequate for
the country.

Koesmarihati refused to elaborate on when the tender will be
launched.

Telkom recently built a pilot project of GSM on Batam and
Bintan islands in Riau which is now operational. Marketing for
the lines of the project began early this month without any
publication.

The chief of Telkom's office in Batam, Totok Subiyanto, said
Wednesday that some 6,000 of GSM's lines have been sold so far.

"We expect to market some 2,000 lines per year," Totok said.

Telkom, following the success of the pilot project, plans to
market at least 600,000 digital cellular telephone lines within
the next six years.

Price

Totok said that prices for the GSM service in Batam are very
competitive. A hand-held GSM telephone, for example, costs about
Rp 2 million (US$926), as compared to S$2,400 ($1,548) in
Singapore.

He said installation fees are set at Rp 300,000 ($138),
monthly charges at Rp 65,000 and operational charges at Rp 400
per minute and Rp 275 per call.

Totok said the price of a hand-held telephone outside Batam,
which is an export processing zone, is more expensive because of
an import duty of 60 percent.

Telkom's Rp 12 billion GSM pilot project is being developed
with assistance from Siemens AG of Germany and Ericsson of
Sweden, while Satelindo, which will run a similar project in the
greater Jakarta area, is assisted by the France-based Alcatel.

The trial operation of Satelindo's project will likely begin
in September with 20,000 lines. The company expects to sell some
50,000 lines by the end of this year.

Satelindo, operating in the satellite and cellular telephone
business, is 30 percent owned by Telkom, 10 percent by the state-
owned international telecommunications company PT Indosat and 60
percent by PT Bima Graha, an affiliate of PT Bimantara Citra.

Satelindo will offer a card, called SIM, for its GSM service
at a cost of Rp 1.5 million.

GSM, which is derived from Europe, is one of the three leaders
in digital cellular mobile telephone systems. The other two are
the American Digital Cellular (ADC) of the United States and
Personal Digital Cellular (PDC) of Japan. (icn)