Telkom owns up to 21 fold hike in peak hour call rates

Telkom owns up to 21 fold hike in peak hour call rates

JAKARTA (JP): An executive of state telecommunications
operator PT Telkom has admitted that the telephone tariff here
has been hiked 21 fold for local long-distance calls made during
peak hours as per Feb. 1.

Doddy Amerudien, vice president for communications of the
Bandung-based Telkom, told The Jakarta Post on Friday that the
hike, implemented under a system which bases tariffs on distance
and hour, has been postponed since 1995.

The system stipulated in ministerial decree No. 104/1994 was
supposed to be effective on Jan. 1, 1995 all over Indonesia,
Doddy said from the West Java capital of Bandung.

"However, it's already been implemented in areas across the
country but excluding Bandung and Jakarta," he said, giving no
further explanation.

That is why Telkom then finally decided, with the approval of
the government and members of the House of Representatives, to
raise the tariff using the new system.

"We've promised our investors in New York and London as well
as in Indonesia that our rates would be appraised every year ...
We just held back too long," Doddy added.

Telkom is already listed on stock exchanges here and overseas.

He said Telkom has no plan to cancel the hike following
growing public protests, unless the government asks the company
to do so.

"It's really up to the government. But I do think that it
would be unlikely for the government to halt the hike.

I know many Jakartans are suffering ... but we all are in the
same situation together," Doddy said, suggesting customers be
more thrifty in making calls.

He admitted that Telkom had also been informed of the plan of
certain parties to hold a national boycott of Telkom's monopoly
service.

"That's a business risk. We're just implementing the
government's new tariff which has been agreed by the House.

Customers failing to pay their monthly bill will have their
lines isolated. Two months in arrears and the lines will be cut
off," Doddy said.

The new tariff was abruptly announced by Telkom on Jan. 30
under a decree issued by the communications minister a day
earlier.

It said that beginning Feb. 1 Telkom would raise its rates for
domestic long-distance calls by 28.57 percent to Rp 144 per
pulse, local calls by 24.14 percent to Rp 180 per pulse and
telephone magnetic card service calls by 46.67 percent to Rp 220
per pulse.

The rates for coin-operated public telephones remain Rp 100
per pulse, but one pulse has been extended from 2.5 minutes to
three minutes.

One pulse lasts from seven seconds up to three minutes
depending on the distance of the call and the time the call is
made.

But what has made many Jakartans angry is that Telkom is to
charge them on the basis of distance and hours of calls.

For example, a customer in Kelapa Gading in North Jakarta
calling his business partner in Karawaci, Tangerang, used to pay
Rp 145 per two-minute midday call.

Many thought that under the new tariff the customer will be
charged Rp 180, a 24 percent hike as Telkom had announced.

According to the new system, the Kelapa Gading customer would
now have to pay Rp 3,085 for the two-minute talk, which is a
21.27 fold increase. (see table on page 3)

From Jakarta, Joko Dewoto, head of systems and marketing
policy affairs of Telkom's Jakarta office, said that his office
has had no time to disseminate the "new system" to the local
customers.

"Jakarta's Telkom executives only knew of the implementation
of the new tariff on Jan. 29," he told the Post.

"We then immediately got busy as we had to hastily change the
tariff rates on the central system."

A customer, Alam of East Jakarta, questioned Telkom's motives
for being unwilling to publicly reveal the new tariff system.

"Small people like me are totally blind to that system and
calculation," he said.

"How can Telkom shock us like this?"

"Are they trying to tell us that just because the government
has no money, Telkom then has the right to bleed us dry?" Alam
asked.

City councilor Saud Rachman urged the government to
immediately review the hike.

"The government cannot damage the economy of Jakartans... they
know that phones are a daily necessity. The government must be
wise enough to review these rates." (ylt)