`RI not ready for 3G technology'

`RI not ready for 3G technology'

Fitri Wulandari, The Jakarta Post, Jakarta

The government's offer to build the much-hyped third
generation (3G) mobile service nationwide has received cool
responses from telecommunication players, who said the service
would not sell in Indonesia, which was still largely a voice
market.

Rudiantara, the chairman of the Indonesian Cellular Phone
Provider Association, said the service did not yet have any
commercial value.

"The technology is relatively new while consumer buying power
and market demand are still low. Thus, its commercial value is
not there yet," Rudiantara told The Jakarta Post in a phone
interview.

Hasnul Suhaimi, commercial director of giant phone operator PT
Indosat, was of a similar opinion saying most of Indonesia's 11.4
million mobile service subscribers used their cell phones only to
exchange voice messages. A very limited number used them to
exchange data.

Indosat operates two cellular phone services, called Satelindo
and IM3. Besides, it provides satellite and long distance call,
and fixed-line services.

Hasnul said that the General Pocket Radio Service (GPRS),
which is a data-exchange facility available to IM3 subscribers,
accounted for a mere one percent of IM3's total revenue. This
illustrated how exchanging data via cell phones was still
unpopular in the country.

Dubbed the two-and-a half generation mobile service, GPRS is
deemed as a necessary transition between the second generation
and 3G. It enables high speed mobile data transmission of
applications such as mobile Internet browsing and e-mails.

Meanwhile, PT Telkomsel, whose subscribers make up 52 percent
of the total number of subscribers nationwide, could not be
reached for its views. Telkomsel is a subsidiary of the country's
largest phone operator, PT Telkom.

Third-generation mobile phone services allow speedy access to
data and video through the Internet.

The technology has caused a fuss around the world. In European
countries like Britain and Germany, telecoms operators paid
billions of dollars to the government for 3G licenses. Many
governments then used the issuance of 3G licenses as a chance to
quickly rake in billions of dollars in revenue.

In 2001, Japan's NTT DoCoMo introduced the world's first 3G
technology enabling users to relay video images and download
music.

The government announced on Monday through advertisements in
various papers that it was offering 3G licenses to
telecommunication companies in Indonesia through a bidding
process.

According to the announcement, only those who have no
partnership arrangement nor affiliations with the country's
existing telecommunication operators may apply for the 3G
licenses.

This means the country's two giant phone operators will not be
able to enter the market.

Hasnul said this prohibition might hamper the development of
3G technology here because the future 3G operators must be new
companies who do not have a costumer base. At the same time, they
have to sell relatively new products.

"Usually, only old cellular subscribers have the capability to
buy the service. Not new ones. As such the future 3G operators
will have to attract the current cellular subscribers to switch
to their services," Hasnul explained.

Hasnul added that in many countries, the existing operators
were allowed to bid for 3G licenses as they had a customer base.

Both Hasnul and Rudiantara agreed that the technology would
only become feasible in four to five years time.