Indonesian market leader Telkomsel may have to allow smaller operators to share important sections of its network following new regulatory proposals.
The country’s regulator is looking to open up the telecoms sector in order to push the deployment of broadband over the next three years.
Telkomsel leads the market with a 44% share or connections, while its coverage is the most widespread across the archipelagic nation. However, particularly with regard to the low average income, its prices are considered somewhat high – especially in rural communities.
“The strategy has to be built in a more efficient way, which is to allow active sharing,” said Communications and Information Minister Rudiantara. He noted that if Indonesia continued using its current model for deploying fixed and mobile networks, it would find a $15 billion black hole in its funds.
The country’s other operators, including Hutchison 3 Indonesia, Indosat and XL Axiata, have all called for spectrum sharing. However, since the matter is tied to national security, the government has been cautious about rewriting the rules.
Of Indonesia’s state-owned businesses, Telkom is a major source of revenue for the Indonesian government, bringing in $2.4 billion for the state last year. The network-sharing proposals could be part of a strategy to support President Joko Widodo’s goal of extending connectivity to every Indonesian island by 2019.