Telkom denies strong-arming cellular operators

JAKARTA (JP): State telecommunications company PT Telekomunikasi Indonesia (Telkom) has denied an allegation that it has forced cellular operators to use its transmission facilities for their domestic long distance calls.

Telkom's director of operations and marketing John Welly said cellular telephone operators were free to use their own terminals.

"The allegation that Telkom is still charging cellular operators with interconnection fees on domestic long distance calls is also not true," he said last week.

He was commenting on a recent call made by the Directorate General of Post and Telecommunications urging Telkom to stop instructing cellular operators to use Telkom's transmission networks for domestic long distance call services and asking for payment for the service.

According to a decree issued by the Minister of Communications in May this year, cellular operators can use their own mobile switching center (MSC) instead of Telkom's fixed line trunk exchange terminals when serving domestic long distance calls.

But cellular phone operators complained that Telkom ignored the ruling and still required them to use its transmission facilities.

According to the regulation, cellular operators are only required to pay the interconnection fee to Telkom if they use the state telecommunications company's transmission facilities.

Cellular operators are now using Telkom's terminals only when transmitting local, international or domestic long distance calls which involve Telkom's fixed line phone users, he said.

"Operators will have to use our terminals and pay for the interconnection fee if they transmit calls to Telkom's fixed line phone users," he said, adding that cellular operators would have to do so because they did not have the facilities to allow direct transmission from cellular phones to a fixed line phone.

Telkom's president A.A. Nasution admitted that the government's decision to allow cellular operators not to use Telkom's terminal for domestic long distance calls between cellular phone users would affect the company's revenues from interconnection fee.

"But, we will not ask the government to withdraw the regulation. It will happen sooner or later anyway. We just consider it as sharing our business opportunities with others," he said.

John said the fact that cellular operators would not contribute interconnection fees to Telkom for their domestic long distance call services would not significantly affect Telkom's revenues from interconnection fees.

Telkom received Rp 572.77 billion (US$88 million) in 1997 and Rp 555.51 billion in 1998 in interconnection revenues.

John said domestic long distance calls only contributed a small portion in Telkom's entire interconnection revenues.

"The biggest part, or about 80 percent, of our interconnection fees actually come from international calls," he said. (cst)