Indonesian government cracking the whip on lazy telcos

Build networks or I'll cancel your license, says minister


Indonesia's crowded mobile carrier market is set for a consolidation one way or the other, with the country's communications minister warning minnows they could lose their operating licenses.

The world's fourth most populous nation, with about 250m souls inside its borders, has ten mobile carriers. The United States' 320m residents get by with five.

Comms minister Rudiantara says if the smaller carriers don't start building out more services, they will find themselves in breach of their license conditions.

Bloomberg quotes the minister as saying "Each permit has requirements for the operator to invest and build, so if they don't build anything, I can revoke their permit."

XL Axiata, Indosat, and the part-state-owned Telkom are the big three of the market with a total of 80 per cent share, leaving the remaining seven to squabble over just 20 per cent of the subscribers. So over the next four years, Rudiantara wants the market slimmed down to four operators.

Even 20 per cent of the market would be big enough to make Telstra weep: there are 300 million mobile subscribers in the country, but Rudiantara says he's had to hand out fines to carriers that aren't meeting their investment obligations. Some, in fact, hold licenses but haven't gotten around to offering mobile services.

Rudiantara also announced plans to auction 15-year contracts to build broadband infrastructure on the Indonesian islands of Riau and Maluku. ®

Bootnote: In case you ask, no, Vulture South didn't leave out part of Rudiantara's name: Mononyms are common in Indonesia. ®


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