Three cellular operators plan to merge this year

JAKARTA (JP): Three local cellular operators -- PT Komunikasi Selular Indonesia (Komselindo), PT Metrosel and PT Telesera -- are planning a merger this year in a bid to increase efficiency and provide better service to customers.

Komselindo's director of operations, Bambang Soesijanto, said a merger of the three companies, which operate the Advanced Mobile Phone System (AMPS), would greatly benefit customers as they would no longer have to switch networks as they moved across Indonesia.

"It would also mean only one overhead cost for us instead of three, and the development of products could be integrated instead of each of us developing different products," he said over the weekend.

He declined to say exactly when the merger would take place, but said he expected it would happen before the end of this year.

The merger would bring together three companies that own regional licenses, forming them into one large national company.

Komselindo owns operating licenses for northern Sumatra, West Sumatra, West Java, Jakarta and Sulawesi. Metrosel for Central Java, East Java, Maluku and Irian Jaya, and Telesera operates in southern Sumatra, Kalimantan, Bali and East Nusa Tenggara.

An existing agreement between the three operators allows customers of one operator to use the networks of the other two operators when the former's network is unavailable, Bambang said, adding that for the service customers were charged a roaming fee.

"(After the merger) billing will be a lot simpler and a lot cheaper," he said.

Bambang said a special team comprising representatives of the three companies were currently calculating the cost of the merger.

Also under calculation is the capacity needed to launch the new service under a new banner, as it is expected to attract a lot more subscribers, he said.

Ideally it should be capable of servicing between 750,000 and one million subscribers, Bambang said.

Komselindo has about 70,000 subscribers, Telesera about 15,000 and Metrosel about 50,000 subscribers, he said.

Bambang also said the three operators would shift their services from AMPS to the more advanced Code Division Multiple Access (CDMA) system at 800 Megahertz.

He said the shift was to ensure customers were provided with the latest technology and to give the companies a competitive edge with operators of the Global System for Mobile Communications (GSM), currently the most popular network in the world.

"GSM may be ahead in the voice market, but for data CDMA is leading," Bambang said, explaining that the cellular trend was increasingly shifting toward high-speed data transmission, which CDMA provides.

The CDMA technology can transmit data at 14.4 kilobits per second compared to GSM at 9.6 kilobits per second, he said. (tnt)