Operators demand restrictions on number of new players

24 Jun 2008

Indonesia’s telecoms heavyweights have teamed up to demand that the government limit the number of new entrants to the industry, citing limited resources and growing investment risk as the reason. According to the Jakarta Post the chairman of the Indonesian Cellular Telephones Association (ATSI), Merza Fachys, said limited frequency resources and phone numbers meant there was no room to accommodate new players. In a speech to members of the industry Merza said ‘The government must regulate the number of players so as to ensure the sustainability of the industry.’ He went on to note that by allowing unlimited entry to the market, the government risked crowding the market and generating investment risk for the country’s existing players. He added that as a result of competition there was already an unhealthy tariff war between mobile operators, sparking aggressive rate cuts. His views were echoed by Telkom director Rinaldi Firmansyah who said: ‘There are far too many players. The regulation must limit the number of players.’ Telkom owns a more than 65% stake in the country’s leading cellco by subscribers, Telkomsel.