Mobile-8 merges subsidiaries to boost efficiency

Ary Hermawan, The Jakarta Post, Jakarta

The country's fourth largest CDMA-based cellular operator, Mobile-8 Telecom, has completed the merger of three of its subsidiaries, PT Komunikasi Selular Indonesia (Komselindo), PT Metro Selular Nusantara (Metrosel) and PT Telekomindo Selular Raya (Telesera), to reduce operating costs.

The merger plan was approved by the firm's shareholders meeting held early last month and became effective May 31 as stipulated by the Capital Market and Financial Institutions Supervisory Agency (Bapepam-LK), the company said in a statement received by The Jakarta Post,

"We are pleased with this merger as it will further increase the company's efficiency with regard to operations and operating costs," corporate secretary Fransisca said in the statement.

Mobile-8, which operates a code division multiple access (CDMA)-based cellular service under the trade name Fren, will replace the network system used by the merged companies with the digital CDMA system.

Metrosel, Komselindo and Telesera provide analog (AMPS) cellular services in Java, Bali, Kalimantan, Sumatra and Sulawesi.

"Mobile-8 has begun progressively phasing out the AMPS system and replacing it with the CDMA system, and is able to provide nationwide services," the company said.

The AMPS system was popular in the early 1990s before the introduction of Global System of Mobile Communications (GSM) technology.

Mobile-8, which had around 2 million subscribers during the first quarter of the year, is currently expanding its services to areas outside Java. It plans to increase its subscriber base to around 4 million customers this year and 6.9 million customers by the end of 2008.

At present, Mobile-8 has 490 base transceiver stations and plans to establish another 1,408, with 50 percent of these to be located in Sumatra, Kalimantan, Sulawesi, Papua, Maluku and both West and East Nusa Tenggara.

The market for low-cost CDMA-based mobile phone services is already somewhat crowded, with players including Telkom with its TelkomFlexi product, Bakrie Telecom with Esia, Indosat with StarOne and Sampoerna Telecom Indonesia with Ceria.
_________________________ Indonesian Business and Investment News Aggregator