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Archive for the ‘General’

XL and Axis requested additional 3G Bandwidth

October 11, 2010 By: Syahrial Ali Category: General

Responding to the increasing demand of data service and internet broadband, two 3G operators XL Axiata and Axis requested additional 3G bandwidth to the government. XL was awarded the 3G license in the early 2006 with 2x5MHz bandwidth. Meanwhile, Axis (NTS) received their licensed one year before that.  Both operator requested another 2×5 MHz bandwidth.

With this request, from 5 3G operators, only Hutch which does not request additional bandwidth. It implies that both operators have greater demand in data service and internet broadband than Hutch. Meanwhile Telkomsel and Indosat have requested this additional bandwidth and got it last year. Additional spectrum bandwidth will make the network performance of these operators better and serving more subscribers. In addition, customers will be more comfortable because it’s easier to broadband service connection speed and higher capacity.

When the requested approved, both operators should pay for the spectrum levy according to the price of 2006, namely IDR 160b per year. Besides that, they also have to pay upfront fee, 2xIDR 160b.

According to Hasnul Suhaimi, XL’s CEO, additional 3G bandwidth is a step toward 4G technology implementation. 4G implementation is still far away although traffic data is getting higher and higher.

Both XL and Axis also requested International Direct Dialing License (IDD).  Both operators lose in IDD license tender three years ago from Bakritel. Favorite XL was failed because of incomplete administrative reason, while Axis because of higher proportion of foreign shares. Both operators believe that the IDD market is still high and current provider (Telkom, Indosat and Bakrie) can not fulfill all the demand.

Telkom is the leader in International call with 53% of market, followed by Indosat and a small portion of them to Bakrietel.  International call was 70% outwards while 30% are inwards.  Total duration of the call is around 3 billion minutes.

Syakied Sungkar , Axis’s VP Sales and Distribution said that “If Axis is given a IDD license, we will make the IDD call rate very competitive. ” Customer will get benefit with this competition. However, so far there is no indication for second tender of IDD license.

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Semester 1 2010, XL profits went up, their compatriots decreased

September 22, 2010 By: Syahrial Ali Category: General

At the end of first semester of 2010, XL noted a massive increment in their profit. XL got IDR1.32 trillion or an 87.4 increment compare to the same period last year which was only IDR 706 billion. This figure is the XL’s highest profit so far. XL got IDR 8.5 trillion revenue for this semester, 35% increment of the same period for the last year which was only IDR 6.25 trillion.

In contrast to the PT XL Axiata, two other major mobile industry, Telkomsel and Indosat have decreased profits, and the largest suffered by Indosat. The profit of cellular operator owned by Qatar Telecom (Qtel), went down 71.5 percent compared to the first half of the year 2009. From IDR 1.007 trillion to only IDR 287 billion. Though its earnings rose 5.8 percent in the same period, from IDR 9.135 trillion to IDR 9.662 trillion. Meanwhile Telkomsel, the biggest cellular operator in Indonesia also has decreased its net profits for about 4 percent from IDR 6.2 trillion to IDR 5.9 trillion only. The same condition with Indosat, Telkomsel also has increased its revenue from IDR 20.6 trillion to IDR 22.9 trillion.

XL’s high profits was trigger by the massive increment of the subscribers. At the end of June 2010, XL noted 35.2 million subscribers, grew 43 percent compared to 24.7 million in the first semester of 2009. This figure  is just 2.6 million below Indosat’s subscriber. If XL can be consistent with their achievement, we may see XL as the second biggest cellular operator at the end of 2010.

Telkomsel is still working hard in achieving their total subscriber target. At the beginning of 2010, they just had 82 million subscribers and at the end of June 2010, this figure was around 88.3 million, which was still far away from their end year target 100 million subscribers. They still have 6 months from July to achieve this target.

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High Churn Rate, Sparkling the SIM Card Business

September 20, 2010 By: Syahrial Ali Category: General

Indonesian Cellular Operators are facing a high churn rate subscriber. Telkomsel just write off around 4.4 million of its subscribers this year which is equivalent to 5% of its total subsribers. Meanwhile Indosat and XL have a greater number, namely around 12-13% of its subscribers.

The total number of the subsribers of this three biggest cellular operators in Indonesia are around 150 million subscribers. Then the total churn subscriber for these operators are just below 15 million subscriber, a big number for SIM (subscriber identification module) card business. If we also calculate other cellulars operator, the figure can reach 18 million. For your information, Indonesia has 11 cellular operator, 5 of them are using GSM-3G technology while the other 6 are using CDMA technology.

Many people blame the cheap starter pack is the main reason of high churn rate, not to mention subscribers which are unsatisfied with their current service provider. You can have a started pack for less than US$5 with the equal number of credit. So, the operators get nothing when a new subscriber register. On the other hand, SIM Card provider who gets benefits from new registered subscriber.

Cellular operators have to create a new strategies to lower down the churn rate. They just create the business to other party otherwise.

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Satellite Business is quite excited

August 09, 2010 By: Syahrial Ali Category: General

Indonesian Satellite Association (ASSI) disclose the value of the satellite business in Indonesia in semester I/2010 that reached U.S. $ 600 million (about Rp5, 4 trillion), which consists of leasing satellite transponders and service network.

Tonda Priyanto ASSI Chairman expressed the main use of transponders is still for the backbone network for GSM mobile access.

“In addition to the GSM backbone, the use of satellite transponder is also widely used for VSAT networks (very small apperture transponder),” he told Business Today.

Driven by increased use of VSAT rural telephone administration (universal service obligation / USO), Internet service provision project districts, and data networking needs of national companies and government.

Based on ASSI data, the number of transponders in Indonesia has currently reached 200 units, both from local and foreign satellite satellite which has landing rights in Indonesia.

Meanwhile, Eddy Setiawan a consultant in a number of satellite operators said the lease per transponder on average per year is U.S. $ 1 million. Assuming there are approximately 110 units of transponders operating in Indonesia, then the value of business per year reach U.S. $ 110 million.

“That’s only transponder lease, if the VSAT industry is also calculated, then from VSAT earn U.S. $ 152 million per year for a total of approximately U.S. $ 262 million,” said Eddy, a LAPAN (National Aeronautics and Space Institute) consultant.

Former ASSI Secretary General said that this figure does not include the direct-broadcast and television business to home (DTH). (from: bisnis.com)

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Flexi and Esia Will Be Merged?

June 11, 2010 By: Syahrial Ali Category: General

There was a big news this week when the biggest CDMA operator Telkom Flexi intended to merge with Bakrietel Esia. The CEO of PT Telkom, Rinaldi Firmansyah has sent the letter to Ministry of State Own Enterprise, Mr. Mustafa Abubakar concerning this. The minister has given the green light, so Telkom can proceed with their plan.

The negotiation shall be started to reach the win-win solution. As we know, Telkom Flexi is the biggest CDMA operator in Indonesia with currently 15 million subscribers, while Bakrietel Esia is the second with just below 10 million subscribers. When the merger happened, the CDMA market will be monopolized by these operators.

There were different views about this merger. Some argue that this merger will make unhealthy competition in CDMA business. They will dictate the market as they have 80% of the market share. Some others see there are several advantages of this merger for both companies. Telkom and Bakrie can deliver better services to all subscribers since they have adequate bandwidth to play with. They will have more efficient cost both in operational and expenditure.

Above all, we as the customer, not only want better services but also affordable tariff.

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2009 Subscribers, XL was in 2nd Position

June 07, 2010 By: Syahrial Ali Category: General

According to the data from Directorate General of Post and Telecommunication of Republic Indonesia,  there was a big change in the number of cellular subscribers’ data at the end of 2009. Since 2004, Telkomsel was the leader in cellular business, followed by Indosat and XL. However, since the end of 2009, XL was promoted to the second place ahead of Indosat.

At the end of 2009, the number of Indosat’ subscriber was down to 28.6 million, from 36.4 million at the end of 2008. Meanwhile, XL’s subscriber was 31.4 million, increased quite significant number, 5.5  million, from just below 26 million at the same period. Telkomsel was still the leader with more than 81 million subscribers.

In the fixed wireless access, Telkom flexi continues their lead with more than 15 million subscribers, followed by Bakrietel Esia with almost 10 million.

For new entries, HCPT led with 7.3 million subscriber followed by Natrindo Axis with 4.1 million.

The complete data can be found below. (more…)

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