Telkom to keep control in two main regions
JAKARTA (JP): State-owned PT Telkom will continue to operate in Greater Jakarta and East Java despite rumors the two regions, which provide most of the company's revenues, would be privatized.
Company president Asman A. Nasution told reporters here Tuesday that Telkom had never discussed privatization of the two regions with the government.
"I don't know if there is such a plan," he said.
He refused to disclose when the company's exclusive rights to run the business in the two areas would expire.
Telkom divided its operational areas into seven regions: Sumatra, Jakarta, West Java, Central Java, East Java, Kalimantan, and the country's eastern part including Sulawesi, Irian Jaya, Maluku and Nusa Tenggara.
In 1995, Telkom privatized and handed over its networks in five regions including Sumatra, West Java, Central Java, Kalimantan and the country's eastern part.
Under joint operation schemes with Telkom, five private firms were awarded 15-year contracts to develop, operate and manage telecommunication networks in the five regions until 2010.
Telkom has maintained its operations in Greater Jakarta and East Java.
Telecommunications analysts said recently that a number of private firms were keen to set up joint cooperation with Telkom to run the company's businesses in Greater Jakarta (regional division II) and East Java (regional division V).
Last month, Telkom's shares were under pressure following rumors politically-well connected businessmen would enter the domestic telecommunications business.
The secretary-general of the ministry of tourism, post and telecommunications, Jonathan L. Parapak, then reiterated that Telkom would keep its monopoly in domestic telecommunications even though several private companies were interested in entering the domestic telecommunications market. Telkom shares, however, have slumped following the rumors.
The government has never indicated that the telecommunications business in Greater Jakarta and East Java would not be privatized in addition to the existing Jakarta-based PT Ratelindo, a joint- venture firm providing radio fixed-telephones, owned by the Bakrie group and Telkom.
Telkom's total operating revenues are 80 percent derived from the regional division I, 15 percent from division V and the remainder from the five privatized areas. Telkom last year recorded Rp 5.07 trillion in operating revenues.
The company, which listed its shares on the New York, London, Jakarta and Surabaya stock exchanges in November 1995, has been operating 4.2 million lines since late last year.
General manager of Telkom's division II, Guntur Siregar, said there are some 1.7 million lines in Greater Jakarta. Total capacity in the area currently reaches 2.3 million, he said.
"The growth rate of subscribers in the area reaches over 20 percent per year. We expect to see between 4 million and 4.5 million subscribers by the year 2000 with a total capacity of 5.3 million lines."
Based on company data, there are 920,708 lines in capacity and 887,043 subscribers in Sumatra; 684,204 in capacity and 597,766 subscribers in West Java; 424,668 lines in capacity and 389,833 subscribers in Central Java and 931,756 lines in capacity and 897,664 subscribers in East Java; 151,039 lines in capacity and 146,447 subscribers in Kalimantan. (icn)