The Indonesian wireless operator PT Smartfren Telecom, whose shareholders include PT Bali Media Telecommunications (31.41%), PT Wahana Inti Nusantara (29.03%) and PT Global Nusa Data (27.64%), booked revenue of IDR2.59 trillion (USD191.4 million) in January-September 2016, up 14% compared to the IDR2.27 trillion figure reported in the year-ago period. Data services continue to be the biggest driver, contributing IDR2.20 trillion in 9M16, while other business areas were reported as follows: voice call services (IDR205.97 billion), SMS messaging (IDR94.40 billion), subscriptions (IDR17.80 billion), interconnection services (IDR53.12 billion), and ‘other’. A company filing with the Indonesia Stock Exchange (BEI) confirmed, however, that operating losses for the nine-month period climbed to IDR1.53 trillion from IDR783.09 billion, and net profit (losses) widened to IDR1.34 trillion from IDR1.28 trillion.
According to TeleGeography’s GlobalComms Database, the struggling operator has set aside CAPEX of USD100 million in 2016 to support its ambitious 4G network rollout programme. The CDMA operator-turned-LTE provider’s finance director Antony Susilo was quoted in July this year as saying that over the next twelve months the cellco will strengthen and develop its coverage, which already stands at 200 cities and towns. ‘The funds will be from an undisbursed existing loan from China Development Bank (CDB),’ Susilo said, noting that while Smartfren has successfully upgraded its CDMA network to LTE, it will not ditch the older system entirely – at least not this year. According to CommsUpdate, in April this year SmartFren claimed to have boosted LTE coverage to 188 urban centres, more than doubling the 85 cities served in January 2016. At the time, however, the operator admitted that subscriber take-up had not been proportional to the number of cities covered, blaming issues such as the availability of suitable handsets for the slow growth.
Smartfren is working to migrate from the 1900MHz band to 2300MHz as part of a government-led drive, but has been warned there will be ‘zero tolerance’ of it failing to meet the deadline. TeleGeography notes that under the Ministry of Communication and Information Technology’s (MCIT’s) network migration programme, Smartfren will not be able to use the 1900MHz band for its service from the start of 2017 and is looking to move to the 2300MHz band where it is hopeful of securing 30MHz of spectrum. MCIT minister Rudiantara has repeatedly warned the firm that he will not tolerate any delays in the migration programme, adding that by 1 January 2017 the 1900MHz band ‘should be clean of code division multiple access services belonging to Smartfren’.
In a separate development, press rumours are circling that Smartfren has been awarded an ‘in-principle’ licence from the MCIT to operate fixed or fixed cable telecoms services. It is understood that the carrier has been awarded permits to carry out an Operation Feasibility Test (ULO) by the directorate general.