Indonesian six in the dock over price fixing

19 Jun 2008

Six Indonesian telecoms operators – Excelcomindo, Telkomsel, Telkom, Bakrie Telecom, Mobile-8 Telecom and Smart Telecom – have been found guilty by the country’s Business Competition Supervisory Commission (KPPU) of operating a cartel by fixing prices for SMS text messaging services costing consumers an estimated USD301.7 million in excessive fees. ‘The six mobile providers were proven to hold arrangements among them to fix the prices of text messages at between 250 and 350 rupiah from the year 2004 until April 2008,’ the head of the KPPU’s panel of judges Dedie S. Matadisastra was quoted by The Jakarta Post as saying. The competition commission said it found no evidence that Indosat, Hutchison CP Telecommunications (HCPT) and Natrindo Telepon Seluler (Axis) were involved in the price fixing.

As a result of the KPPU’s findings, Telkomsel and Excelcomindo have been fined USD2.7 million each, while Telkom, Mobile-8 and Bakrie Telecom have been fined USD1.9 million, USD538,793 and USD431,034 respectively. Smart Telecom escaped a fine as, according to Dedie, ‘it was only involved in the price fixing agreement in September 2007, during its commercial launching.’