Byron you will like what you read. Bookmark it. The following info can be obtained from this URL:http://www.i-2.co.id/sc_jsx.html (You will need to click on BUSINESS BY SECTOR, then click on ELECTRONICS AND TELECOMMUNICATIONS, then click on TELECOMMUNICATIONS)
Do you think they could use IP technology there(sarcasm)?
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Telecommunications plays a vital role in the national development. Therefore,
during the Sixth Five-Year Development Plan the Goverment takes a serious
concern to develop this sector. The target of the development is clear:
telecommunications should become a reliable means of news, information and
data exchange either domestically or internationally to ensure smooth economic
activities and development process.
So crucial the role of the telecommunications in bringing the country into the
Global Information Network is, the Goverment designated the year 1997 the
Telecommunications Year, a year that is expected to represent a milestone in
strengthening Indonesia's telecommunication infrastructure in preparation for the
coming era of globalization.
In coincidence with the designation, the Department of Tourism, Post and
Telecommunications introduced a program called the Nusantara 21 Target on
Information Superhighway throughout Indonesia. It is hoped, through the program,
that later in the 21st century Indonesia will be able to maintain a through
information network to reach not only major cities, but also remote subdistricts.
Hence, it will be an accelerating drive the country's pursuit for the Era of
Telecommunications and Information Technology.
T-2001 Program
To reinforce the Nusantara 21 Target, PT Telkom, the main state-owned
telecommunications company, launched the T-2001 Program. The target of the program is
that by 21st century PT Telkom will become a world class operator, equal to operators in
advanced countries. Thus will demand for an ultimate world class service, which is
characterized by high SCR (successful call ratio), low disturbance rate, and high
customer satisfaction.
In order to fulfill the target, which needs a total fund of around Rp. 9.6 trillion (about US$
5 billion), PT Telkom has to adopt modern and professional management service based
on speed, simplicity and equality. A concrete step taken by the Government in improving
the quality of service by regulating and rearranging telecommunication operators and the
use of radio frequency.
Today, Indonesian sky has been crowded occupied by frequency of telecommunication
networks operated by a number of operators ranging from cross radio system operators,
radio paging operators, cellular operators, to satellite telecommunication system
operators. Frequency division must be managed carefully and accurately to avoid
overlapping which is detrimental to the quality of telecommunication services.
Another effort constitutes in the Government's encouragement to the private sector,
both domestic and overseas, to lake active participation in the development of
telecommunication sector in the country in the framework of the Joint Operation Scheme
(KSO) and contract management. The KSO concept includes provision of
telecommunication infrastructure and facilities, services, operational, human resources,
financial and management.
Application of Technology
Rapid development in telecommunications sector has put Indonesia on par with other
advanced countries in terms of application of technology. The application of various
new products and invention in telecommunication technology will serve as a solid
foundation to step ahead, especially for the development of rural telecommunications,
which in turn, will improve the economy of the related area.
Today almost all aplplication of telecommunication technology developed in the world
have been adopted by Indonesia, from the convergence of transmission technology,
broadcasting, up to telecommunications hardware and software. The application of
telecommunication technology in Indonesia is becoming more plenary with the launch of
Inteligent Network (IN) and ISDN services.
Telecommunications sector development plan
To meet the demand for basic telecommunications infrastructure, the Government aims to
have 1 million line units installed every year or at least around 5 million line units for fixed
telephones which are connected with the public switched telephone network (PSTN)
during the current Pelita. During the same period, an additional capacity of 600,000 line
units is expected to be installed for cellular/mobile telephones.
The number of additional telephone line units to be installed during the current Pelita is
almost twice that installed in the previous Pelita (Pelita V). However, even if the target for
the current Pelita is achieved, the teledensity in Indonesia will still be low, as it is
expected to reach only 3.6 line units per 100 people by the end of the year 2000.
Telecommunications facilities to be installed will include telephone switching exchanges,
outside plants, transmission satellites and other supporting facilities. To strengthen the
country's international telecommunications network, new communications satellites will
be launched and international sea cable communications systems will be added. Two
new international sea cable systems, respectively located in Surabaya and Batam, have
been completed. Another sea cable system will be installed in Biak, Irian Jaya. At
present, there are four sea cable systems already in operation in Indonesia, including the
two recently launched sea cable systems. The two other systems in operation are located
in Ancol, Jakarta and Cermin, Medan .
During Pelita VI, the telephone network is expected to reach all the capitals of districts
and sub-districts and half of the villages. To increase the public telephone service, more
coin and card telephones will be installed with a total capacity of 150,000 line units or
around 3% of the total additional telephone line capacity planned.
The total investment needed for all the projects is estimated at Rp 18.4 trillion to Rp 19.4
trillion (around US$ 8.2 billion to US$ 8.7 billion). The World Bank estimates that Telkom
(the Government) can raise at least only around Rp 11 trillion (around US$ 4.9 billion),
including Rp 6 trillion (around US$ 2.6 billion) in the form of loans. This means that
around Rp 7.4 trillion (around US$ 3.3 billion) will have to be raised from the private
sector.
Addition of five million line units in Pelita VI
The development of telecommunications facilities in the current Pelita includes the
installation of switching exchanges. Based on Telkom's plan, the installation of new
switching exchanges will continue to be concentrated in the centers of economic
activities. Most of the switching exchanges will be installed in Java, with a total capacity
of 3,900,733 line units by the year 1999, accounting for more than 75% of the total number
of telephone lines to be in stalled in the current five year development period. However,
the number of switching exchanges to be installed outside Java shows an increase
compared with that in the previous five year development period, although it is still small
compared with the total number to be in stalled. In Sumatera, significant numbers of
telephone lines (over 100,000 lines) will be in stalled in North Sumatera, Riau/Batam, and
South Sumatera. In East Indonesia, significant numbers of telephone lines will be
installed in East Kalimantan and South Sulawesi.
Because a large number of telephone switching exchanges will be installed in Java, a
large volume of cable will be needed for 3,620,006 telephone connections. The largest
cable network will be installed in Jakarta (for 1,783,716 telephone connections). In
Sumatera (Regional Division I), an additional cable network will be installed for 939,400
telephone connections, accounting for 17.796 of the total cable network to be installed.
Marketing on telephone lines to be intensified
The Government will step up the development of the telecommunications sector in order
to increase the teledensity in the country, which in turn is expected to stimulate
economic growth. The installation of new central trunks, switching exchanges and
transmission lines has rapidly raised the existing telephone capacity. In 1994, the existing
telephone capacity increased by 906,595 line units.
However, the rapid increase in capacity has created new problems for Telkom. The most
notable problem is the difficulty in marketing of new telephone lines. The other problems
include the low sales of telecommunications features, such as the abbreviative dialling
service, call forwarding to any number service, the hunting system, and the PABX. The
application of sophisticated telecommunications technology in Indonesia has extended
the use of telephone lines beyond sound transmission. Telephone lines can now be used
for data and visual transmissions.
In the past, Telkom almost had no problem in marketing new telecommunications
facilities, as their supply was based on the perceived market demand and the indent and
waiting list systems. According to sources at Telkom, the sales of new lines are low due
to frequent delays in the supply of cable for transmission lines, especially from domestic
cable manufacturers. However, apparently this is not a major problem. Although there is
a big market potential in Indonesia, as reflected in the low teledensity in the country,
because the income of the majority of the people is still small and the market capacity
does not increase as fast as the telephone capacity.
At any rate, in such a condition Telkom must step up its marketing efforts. In this
context, Telkom is trying a new strategy, which emphasizes simplicity, speed and
balance (SSB) in its services to the public. This strategy aims to maintain balance
between service and control.
The most notable move made by Telkom was the lowering of the telephone connection
fee by around 30%, with the new rate having been effective since January 1995. The
lowering of the connection fee was possible because the cost of telecommunications
facilities can now be reduced as a result of technological progress. The development of
new technologies, such as the digital, satellite, radio and optical fiber technologies, is
expected to reduce the investment cost per line unit in the future. For illustration, the
investment cost per line unit, which still averaged around US$ 2,500 per line unit at the
end of the 1970s, was reduced to under US$ 1,000 per line unit.
Another move by Telkom to increase the market capacity for absorbing new telephone
lines is offering telephone connections on credit. Prospective subscribers offered
telephone connections under a credit scheme which allows them to pay the connection
fee by six installments without having to pay interest. Under this scheme, new
telephones are connected and can be used even before the connection fee is paid in full.
To increase sales, Telkom has also adopted telemarketing, which allows requests for
telephone connections to be made by mail or by phone.
All these moves are expected to increase the sales of new telephone lines, The lowering
of the connection fee and application of the credit scheme have received a positive
response from the public, including the lower income classes. In connection with the
50th anniversary of Indonesia's independence in August 1995, Telkom is offering
discounts of 25 % to 50% for new telephone connections. Telkom aims to sell around
900,000 line units.
According; to the Directorate General of Post and Telecommunications in the first five
months of 1995 (January-May), Tclkom secured 263,762 subscribers, which was bigger
than the addition of new lines in the period. Up to last May, a total of 2,645,350 telephone
line units had been connected, accounting for around 65.8%, showing an increase of
5.4% from that at the end of 1994 at 62.4%.
Role of telex and telegram declines
As a whole, the telecommunications service industry in Indonesia has shown a rapid
growth. This is indicated by the provision/sales of telecommunications services by
Telkom and Indosat. As known, telecommunications services in the country is divided
into two categories: domestic and international telecommunications services. Domestic
telecommunications services are provided by Telkom and international
telecommunications services by Indosat.
According to the Directorate General of Post and Telecommunications, the provision of
local and long distance telephone services in 1994 rose by around 30.8%. Local and long
distance telephone services were the main contributor to Telkom's total income. In 1993,
telephone pulses sold for local and long distance calls amounted to Rp 1.88 trillion
(around US$ 839 million), accounting for around 83.8% of Telkom's total income. A
significant increase in sales was also recorded by Indosat, which provides international
telecommunications services. Lately, Indosat has been competing with the newly
operated private telecommunications company, Satelindo.
Unlike the contribution of the telephone service, the contribution of the telex and
telegram services has been declining. This is taken as an indication that they are losing
grounds in competition with the telephone service. It shows that the public prefer to
send data or messages through the telephone transmission network, using the fax
machine. The sales of telex pulses by Telkom and Indosat also dropped last year. By
contrast, the sales of pulses for data communication, which have been managed by PT
Lintasarta Aplikanusa (a subsidiary of Telkom) since October 1991, increased.
PT INDOSAT
PT Indosat is a state owned enterprise operating in international telecommunications
services. The company was founded in 1967 by America Cable & Radio Corporation, a
subsidiary of international telephone and Telegraph (ITT), USA. In 1980, the Government
of Indonesia took over all equity, making the corporation a state owned enterprise of
limited liability. The company links callers in Indonesia with 240 countries around the
globe through four international gateways: one each in Jakarta, Medan, Batam and
Surabaya. Services include telephone calls, telex, telegrams, data packet switching,
facsimile store and forward, inmarsat mobile communications, leased lines, video
conferencing and television channels. The company holds interests in four other
companies. Asean Cableship Pte. Ltd. (ACPL), 16.7% shares owned by Indosat, is
company operating in the laying and maintenance of submarine cables. PT Aplikasi
Lintas Artha, in which the company has 18.8 % shares is direct data communications and
data packet switching company founded in corporation with PT Telkom. PT Satelindo, in
which Indosat holds 7.5% of shares, operates in satellite communications, cellular
telephone and international telecommunications. The company also owns 15% shares of
PT Bangtelindo, a company operating in construction design and management services
for telecommunications facilities, 35% shares of PT Telekomunikasi Seluler (Telkomsel)
as a joint venture between PT Telkom, Setdco Megacell Asia and PTT Telecom BV
Belanda, which provides cellular GSM services. The company has overseas share
investments of which in Suginami n/ Cable and Production House (Japan), domestic
telecommunications carrier Camintel SA (Cambodia] and the USA-Global Link. The
company is the first Indonesian State owned enterprise to undertake a dual listing on the
Indonesian capital market and the New York Stock Exchange (NYSX). The company has
listed 130.6 million share at the price of Rp 7,000 per share in Indonesia and 258.9 million
share at price US$ 3.2 in NYSX. 30% of its net profit in 1995 will be allocated as devidens
to the shareholders. The company holds 5 % of Suginami Cable Television (SCT) of
Japan's shares as a prelude in entering the TV cable business. Beside Indosat,
shareholders of SCT include Jupiter Telecom (50 %) and Telecommunication Inc. (45 %).
It has commemorated 3 sea cable fiber optic communication system connecting
Jakarta-Surabaya, Asia Pacific Cable Network (APCN) and Jakarta Australia (Jasuraus),
with a total investment of Rp. 1.8 trillion. The project is constructed in cooperation with
Alcatel Submarine Network (ASN) of France.
Go to PT. Indosat Home Page
Created 10/1/97, Last Update 11/19/97
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