RI's cellular market continues to increase

RI's cellular market continues to increase

JAKARTA (JP): Indonesia's cellular telecommunications industry
will continue to grow significantly in the coming years,
according to telecommunications experts.

Managing director of Odyssey Telecommunications International
Inc, Marc Leroux, said here yesterday that operators would still
have a chance to grow despite more new players.

He said that up to six Global Mobile Personal Communications
by Satellite (GMPCS) providers would operate in Indonesia.

"There are already a number of cellular operators in Indonesia
and more licenses will be issued, but other systems are
inevitable," he said, adding that his company considered
Indonesia one of the major telecommunications markets after
Brazil, China and India.

Seven cellular operators are running three systems in
Indonesia -- the Nordic Mobile Telephone system is operated by PT
Mobisel, the Global System for Mobile communications (GSM) is
operated by PT Satelindo, PT Telkomsel and PT Excelcomindo and
the Advanced Mobile Phone System is operated by PT Metrosel, PT
Telesera and PT Komselindo.

The government is to launch Monday the tender of 11 licenses
for the Digital Cordless System (DCS-1800) and the Personal
Handy-phone Service (PHS).

The 11 DCS-1800 and PHS licenses will be regional. The
government has divided the country into seven telecommunications
regions.

The licenses include six regional DCS-1800 licenses in
Sumatra, West Java, Central Java, East Java, Kalimantan and the
eastern areas and five regional PHS licenses in Sumatra, West
Java, Central Java, Kalimantan and the eastern islands.

Another five new licenses have been awarded to different firms
to run the two systems regionally and nationally. So there will
be at least 23 cellular operators in 1998 at the latest.

Analysts predict that cellular operators in Indonesia will
generate revenue of at least $700 million by the end of this
year. This is expected to increase by at least four times by the
year 2000.

Commenting on the new licenses, Indosat's director Bambang
Sulistyo said the public would have more choice in selecting
cellular systems. "Just like first, business and economy classes
in airlines, each class will have its own market."

Director of engineering of PT Telkomsel, Garuda Sugardo, said
the country's cellular industry had become more attractive with
up to four systems adapted in Indonesia.

"The handsets trade will also be more profitable.
Telecommunications equipment makers will make more dual-band or
triplet-band handsets."

"On the other hand, people, particularly Indonesians, will
face complicated choices as the handsets are all produced with
the latest technology," he said.

Cellular operators will also face technological challenges,
namely the frequency reservation relating to capacity, and
booming subscriptions, according to Garuda.

In addition to the cellular system, GMPCS firms will be
planning services in the country by 2001. An Indonesian firm PT
ACeS will also offer satellite-network telecommunications
systems.

Globalstar, Intermediate Circular Orbit (ICO), Iridium and the
Equatorial Constellation Communications Organization (ECCO) are
among GMPCS firms already cooperating with Indonesian firms in an
attempt to penetrate Indonesia.

Leroux said Indonesia had a significant market for GMPCS
services due to geography and other demographic factors.

He said his company was discussing cooperation agreements with
some Indonesian firms.

Sources said Satelindo was a potential partner for Odyssey.
"But there's no approval from the government yet. Meanwhile,
Satelindo will hold an extraordinary shareholders' meeting on
Monday," the sources said.

Odyssey will operate 12 satellites in the medium-earth orbit
and seven earth stations. The US$2-billion system is expected to
begin service in 2001. (icn)