Sinar Mas to Enter Mobile Market

PT Sinar Mas Telecommunications plans to become the 10th mobile-phone operator in the country, where competition has forced companies to slash call rates.

The company plans to build a network capable of serving 1.4 million users by the end of the year, director Ubaidillah Fatah told Bloomberg News. Sinar Mas aims to attract 700,000 users this year, starting services next month.

Mobile-phone companies including Hong Kong billionaire Li Ka-shing's Hutchison Telecommunications International Ltd have slashed prices to lure consumers in Indonesia, where mobile phone users are forecast to jump 25% to 100 million in the next two years. PT Telkomsel, the country’s biggest mobile operator, said in June the price war was crimping revenue.

Telecommunications companies expect demand for mobile services to increase as economic growth boosts incomes in the country, where 37 million people earn less than $18 a month. About a third of Indonesia's 235 million people have access to phone services.
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