Telkom to keep its monopoly on long-distance calls

Telkom to keep its monopoly on long-distance calls

JAKARTA (JP): The secretary-general of the ministry of
tourism, post and telecommunications, Jonathan L. Parapak, has
reiterated that PT Telekomunikasi Indonesia (Telkom) would keep
its exclusive rights to provide long-distance calls until 2006
and domestic calls until 2011.

Parapak said Telkom's would keep its monopoly even though
several private companies were interested in entering the
domestic telecommunications market.

"They're allowed to express interest only but the regulations
won't change," Parapak said during a gala dinner Sunday evening
hosted by cellular operator PT Telkomsel.

Telkom shares slumped last week on rumors politically-well
connected businessmen would enter the market.

The potential competitors include companies owned by President
Soeharto's son Bambang Trihatmodjo, and by Sudwikatmono, a
relative of the President.

State-owned international telecommunications provider PT
Indosat is also planning to offer a long-distance service by 2005
and a local service by 2010.

Although Telkom has denied the rumor, the company's shares
plunged on the Jakarta Stock Exchange. Telkom shares fell Rp 75
to Rp 3,550. Telkom is also listed in London and New York.

Parapak told The Jakarta Post the government would
consistently keep the three telecommunications regulations which
include domestic telecommunications, long distance calls and
international calls.

In 1995, the government granted exclusive rights to PT Indosat
and PT Satelindo to run international telecommunications services
until the year 2005.

In the same year, Telkom was granted a 10-year monopoly on
long-distance calls.

Also in 1995, five private firms were awarded 15-year
contracts to develop, operate and manage telecommunications
networks in five regions excluding the greater Jakarta area and
East Java under a joint operation with Telkom.

Parapak refused to disclose the details of government's plan
to hold tenders for the Personal Communication Network (PCN), the
next generation of digital wireless telephone systems.

In addition to the three existing systems run by seven
operators, the government has decided to adopt the Digital
Cordless System (DCS-1800) and the Personal Handy-phone Service
(PHS) in Indonesia after successful trials here and in Surabaya.

The three existing systems are the global system for mobile
communications (GSM), the advanced mobile phone service (AMPS)
and the Nordic mobile telephone.

Sources said the government would grant at least 16 new
licenses by the end of the year and would include two nationwide
DCS-1800 licenses.

The sources said the other 14 licenses would include PHS and
DCS-1800 licenses for each of Indonesia's seven
telecommunications regions (Sumatra, Kalimantan, Greater Jakarta,
West Java, Central Java, East Java and the eastern areas).

Interested bidders include the five private firms awarded 15-
year concessions to develop, operate and manage domestic
telephone networks in five different zones.

The existing GSM providers were also interested in applying
for regional licenses so they could operate dual-band GSM/DCS-
1800 systems, the sources said.

All the local AMPS operators will upgrade their services into
the code division multiple access system. (icn)