Telkom to add 6 million mobile users a year

Telkom to add 6 million mobile users a year

Bloomberg
Jakarta

PT Telekomunikasi Indonesia, the nation's biggest phone
company, said its mobile subscribers may grow at an average of
about 40 percent a year at least until 2006, aided by a larger
network.

Telkom, as the company is called, plans to add about five
million to six million users a year by expanding capacity and
offering packages to boost its subscriber base, President
Director Kristiono said in an interview in Hong Kong.

An expanding economy and a growing market for used handsets
are spurring demand for telecommunications services in Indonesia,
a nation of 235 million people where fewer than one in eight
people have access to a phone. Bandung, West Java-based Telkom
spent Rp 2.19 trillion (US$243 million) in the first half to
increase its cellular capacity to 14 million users.

"This market is still under penetrated" said Ferry Yosia
Hartoyo, an analyst at DBS Vickers Securities in Jakarta, who has
a buy recommendation on the stock. "Phone companies can easily
gain that many subscribers a year in the next three to four
years."

PT Telekomunikasi Selular, the company's biggest cellular unit
with about half the market, had 12.4 million cellular users at
the end of June. Smaller rival PT Indonesian Satellite Corp.
controls 30 percent of the market, while PT Excelcomindo Pratama
has about 15 percent. Telkom said earlier it wanted to add as
many as five million new mobile subscribers this year, a 52
percent increase from 9.6 million at the end of last year.

Expand Network

China had 310 million mobile-phone subscribers at the end of
June, about a quarter of its population. In Singapore, cellular
subscribers account for more than 80 percent of its population.

Telekomunikasi Selular, or Telkomsel, said in June it plans to
spend about $600 million to expand its network this year. Indosat
last month said it plans to raise spending to $750 million this
year to expand its network and boost subscribers to 9.5 million
by the end of this year.

Indonesia's $208 billion economy, the biggest in Southeast
Asia, is forecast to grow 4.8 percent this year and 5.4 percent
next year, the fastest pace in nine years.

Telkom's other mobile unit is PT Mobile Selular Indonesia.