StarOne aiming for eightfold increase in customers

StarOne aiming for eightfold increase in customers

Leony Aurora, The Jakarta Post, Jakarta

Indosat's fixed-wireless phone provider StarOne aims to increase
the number of its customers by eight-fold to 800,000 by the end
of this year, a senior company executive says.

Director of fixed telecommunications and multimedia Wahyu
Wijayadi told The Jakarta Post on Wednesday that within seven
months of its operations, which started last May, StarOne had
already attracted 100,000 customers.

"We plan to add five more cities to our portfolio," said
Wahyu. He declined to specify which cities.

The fixed-wireless service that uses Code Division Multiple
Access (CDMA) technology started gaining ground in the industry
last year due to an aggressive sales campaign and low rates,
which are almost equivalent to those of fixed lines.

The strong surge of customers turning to fixed-wireless phones
has started a mini price war, with competing Global System for
Mobile Communications (GSM) operators, cutting their rates.

"We will focus on quality," Wahyu said.

StarOne is the latest entry into the fixed-wireless sector
with services in Jakarta and Surabaya and its surrounding areas
of Malang and Pasuruan in East Java.

Other major operators in Indonesia are Telkom's Flexi service,
which dominates the market with 1.5 million subscribers, PT
Bakrie Telecom with its Esia service and Fren from Bimantara.

Fren, which had an estimated 500,000 users by the end of 2004,
aims to get one million new subscribers this year and expand to
Bali, Sumatra and Kalimantan. Younger but more aggressive Esia
plans to attract 500,000 new customers to add its existing
250,000 with Rp 1 trillion (US$107.70 million) in capital
expenditure this year.

In 2005, Indosat, the country's second largest
telecommunications company with three cellular brands -- IM3,
Mentari and Matrix as well as fixed-wireless StarOne -- intends
to spend between $700 million and $1 billion, more than what it
spent last year.

"It depends on the market," Indosat cellular marketing
director Hasnul Suhaimi said.

Some 80 percent of the company's capital expenditure will go
into Indosat's cellular division, Hasnul said.